Gingrich took in only $638,830 in that month. Gingrich’s largest — $1.03 million — is to Moby Dick Airways, a private jet company. Gingrich also owes a great deal to himself: $580,134. Among Gingrich’s other debts are the $16,525 he ...
British Land's Asset Values Stagnate as Retail Properties Slip Bloomberg
(BLND), the UK's second- largest real estate investment trust, said net asset value was little changed in the quarter through March as gains on office developments were matched by a drop for retail properties. Net asset value rose to 595 pence a share ...
Economists more upbeat about job growth, housing CBS News
NEW YORK — A new survey shows economists are growing slightly more optimistic about recovery in the job and housing markets but expect other pillars of the economy to remain weak. The National Association for Business Economists says in a report ...
A legislative panel called to rescue two stalled foreclosure-prevention bills is bogged down, and Gov. Jerry Brown wants to use part of California's share of the national mortgage settlement to trim the state's budget deficit. SACRAMENTO — Efforts to ease California's foreclosure woes, among the worst in the nation, are running into roadblocks at the state Capitol.
China Money Rate Trades Near 1-Year Low on Rate-Cut Expectation Bloomberg
China's benchmark money-market rate traded near the lowest level in 12 months on speculation the central bank will lower interest rates to support economic growth. Morgan Stanley economists led by Helen Qiao said the central bank may cut both lending ...
Convention center paradox: doing well, but deep in debt Lancaster Newspapers
From a debt standpoint, however, the convention center appears headed for a fiscal cliff. Nearly $64 million in debt hangs over the center, and interest rates have gone up, even as the hotel tax revenues used to make bond payments and fund operations ...
David Jones Seen Luring LBO on Lowest Value Since '04: Real M&A Bloomberg
With Australia's central bank now cutting interest rates, and David Jones in need of a turnaround, now is the time for potential buyers to look, according to Commonwealth Bank of Australia. David Jones' real-estate portfolio is “something tangible that ...
Business Beat: Leesville real estate agent makes national '30 Under 30' list Alexandria Town Talk
Each spring, the magazine selects 30 young Realtors "who are successful in the real estate business and have demonstrated skill, success, creativity, and leadership in their careers." This year's honorees are featured in the May/June issue of Realtor, ...
Mortgage rates dipped again, for the sixth week in a row, pushing the rate on the most common type of mortgage below 4 percent for the first time in the history of Bankrate's survey.
The residential mortgage-foreclosure crisis was good for business at Ahome Affordable Homes in Millville. Make that too good: After several years of growth, the respected nonprofit agency, which had assisted at least 2,100 people facing foreclosure since 2009, laid off four counselors and several other staff members last month because its funding couldn’t keep up with the demand for services.
OBC cuts interest rate on education loans by up to 1% Zee News
New Delhi: State-owned Oriental Bank of Commerce (OBC) has reduced interest rate on education loans by up to 1 percent. "We have slashed rates on education loans across the board effective May 15," OBC Chairman and Managing Director SL Bansal said.
Economists are not using the word “bubble,” even though the real estate picture in American farmland sort of looks like one. Farmland values are up around 20 percent or more in the Midwestern corn belt in the first quarter of the year.
Low interest rates mean good time to refinance LubbockOnline.com
“Today is a very low interest rate environment, and many people should look at refinancing their mortgage if they have a high rate,” Hein said. “A 30-year mortgage today can get about 4 percent. Compare the mortgage interest rate you're paying to that, ...
Oklahoma real estate value includes oil, gas Enid News & Eagle
From AP OKLAHOMA CITY — A largely unseen business has helped fuel Oklahoma's economic power alongside commercial real estate's steady contribution. Oil and gas drilling and mining have accounted for 10 percent of the state's gross domestic product the ...
Understanding Mortgage Rates NASDAQ
Everyone wants to get the lowest mortgage rate they can when buying a home or refinancing their current home loan. But chasing after the lowest rate can be a sucker's game.That's because the lowest interest rate doesn't necessarily mean the least ...
Real Estate Capital Firm Offering Commercial Mortgage Financing for Assisted Living Facilities and Health Care Properties Clopton Capital, a secondary market commercial lender which provides commercial real estate loans for income producing properties nationwide, is announcing the expansion and addition of loan options for developers and owners of assisted living facilities and health care ...
Eurozone Debt Crisis Part 1: When Mexico was Greece and the US was Germany Forbes
Low interest rates combined with hearty risk appetites almost inevitably lead to credit bubbles. Eager investors or lenders seeking yield on the one hand, and professional politicians with election promises to keep on the other, make for great tango ...
The Homes.org weekly mortgage rate report helps buyers and sellers keep updated on what is happening with mortgage interest rates across the nation. The report provides details on what’s impacting today's mortgages - the latest economic activity, current average rates and forecasts for what's likely to happen in the mortgage market.(PRWEB) May 19, 2012 Homes.org mortgage report is delivering ...
The Intriguing Real-Estate Sale at Capmark Barron's
Capmark Financial Group, a former major commercial-real-estate lender, whose failure wiped out investors at the height of the financial crisis, could make at least partial amends over the next two or three years. Started 18 years ago as GMAC Commercial ...
Keystone Real Estate: Give your property an advantage Summit Daily News
These would be perfect buyers who could easily pay full price for each property — again, resort real estate or otherwise. In reality, however, even in today's market with financing at approximately 4 percent for a 30-year-fixed-rate loan, ...
Washington Real Estate Investment Trust Amends and Extends Credit Facility EON: Enhanced Online News (press release)
In addition, the amendment lowers the interest rate to LIBOR plus a margin of 107.5 basis points (previously 122.5 basis points) based on WRIT's current credit rating and eliminates the requirement for guarantees from WRIT's subsidiaries under certain ...
SHERMAN OAKS, Calif., May 18, 2012 /PRNewswire/ -- National real estate expert and sales guru Steve Harney and best-selling author and Prospect Mortgage's Chief Performance Officer Todd Duncan will co-host ...
Interest rates for CCC loans announced Leesville Daily Leader
By Staff reports Commodity Credit Corporation's (CCC) variable interest rate for 2011 commodity loans disbursed in May 2012 is 1.125 percent per annum. CCC's commodity loan program for corn, cotton, rice, grain sorghum, soybeans, sugar, wool, honey, ...
Here at Curbed celebrity real estate is a dime a dozen, from tales of woe, to multimillion-dollar transactions, to sports stars trading one massive mansion for another. How can one make sense of all these famous people buying and selling properties? Enter the Celebrity Real Estate Heat Map. Below, please find the 20 hottest stories from the past few months, taking place as close as Connecticut and as far away as Hawaii. Of course, NYC and Los Angeles are veritable epicenters of celebrity real estate madness, so be sure to zoom in on those cities closely. See someone missing? Leave 'em in the comments.
A number of high street lenders have reduced their loan-to-values, slimmed porting options and raised interest rates in recent weeks Banks and building societies are introducing "stealth" changes to their mortgage ranges to make it harder for borrowers to qualify for loans, as well as increasing their interest rates. Since the credit crunch lenders have been operating strict lending criteria ...
The Association of Landlords Sure maybe theres more pain to come in the housing market But when Time magazine starts running covers that declare Owning a home may no longer make economic sense its time to say Enough is enough...
Celine Dion has listed her 24,000-square-foot private island estate, located some 15 minutes from Montreal, for 29.3M, and one really has to wonder: what would the 24,000-square-foot private island estate of a Vegas headliner who wore a "seven-pound tiara composed of 2,000 Austrian crystals" for her wedding and was once fined for using 6.5M gallons of water a year to fill her pool at her Florida compound actually look like?
Yup, exactly. According to the Wall Street Journal, Dion and husband René Angélil have been spending more time south of the Canadian border recently, which is why they're trying to unload the French Normandy-style castle. In addition to the dizzingly opulent interiors, the pop star will also leave behind Persian rugs, linens, china, flatware, art, and her massive collection of antique furniture, which are all included in the purchase price. Some standout details: a foyer with inlaid marble floors, a dungeon-like stone wine cellar, and a pool house with its own kitchen. All this on an 830,000-square-foot private island that's accessible only by a gated bridge. Don't worry, though, "a helipad can be created to make access by air possible."
With Facebook shares set to begin trading, well, right around now, it only makes sense to take a look around Silicon Valley, where Facebook's IPO is set to ignite the real estate market. According to recent reports, sellers in the Palo Alto area have been anxiously anticipating the flood of newly minted millionaires and speculators have already driven prices up by 10 percent. For all the conjecture, only now will we find out if these Facebook kids have a taste for luxury real estate. To make things a little easier on them, we've picked out five of Silicon Valley's finest—or at least most expensive—properties, starting with this, the Buck Estate. Built in 1934 for a wealthy San Francisco industrialist as a summer retreat, the English country-style residence lies less than eight miles from Facebook headquarters and features the sort of old world finishes that are hard to come by, even for the super wealthy. Currently listed for almost $11M, the 16,900-square-foot, six-bedroom mansion could use some (presumably expensive) TLC on the inside, but otherwise looks fit for a king, as well it should, because the Buck Estate was modeled after "Hampton Court in Middlesex, England, a 16th century royal family residence."
↑ For even more seclusion, we head to the hills of Portola Valley, Calif., where the Villa Lauriston has been languishing on the market, awaiting just this sort of flood of cash. Currently listed for $15.95M, a discount of more than $4M off its 2010 asking price, the villa was built for San Francisco businessman and noted perfectionist Herbert Edward Law and once home to William Randolph Hearst's attorney, who is thought to have burned the "Rosebud" papers in the basement furnace. The 1926 stone structure, with seven bedrooms and ten baths, sits on 28 private acres of hillside.
↑ For something much more modern, befitting a social networking exec, this Swatt Miers-designed contemporary mansion, listed for $19.8M and set on a hilltop in Atherton, checks all the boxes. Known as the Oz Residence, the house sits on 2.6 treed acres and utilized the finest materials in its construction, like Honduran mahogany and African walnut. Partly inspired by the Museum of Modern Art, these sleek accommodations include five bedrooms, four bathrooms, and 9,300 square feet of living space.
↑ Though designed and built in 2008, this Atherton estate doesn't skew quite as modern as the last one, but still carries the sky-high listing price of $15.8M. Built from stone with Post and Beam influences, the 8,100-square-foot main house includes five bedrooms and 4.5 baths, while the grounds are complemented by a broad stone patio with swimming pool and dense plantings that ensure privacy. Luxury finishes abound, with French limestone lining the fireplaces, mahogany windows and doors, and 10-inch-wide plank floors of white oak. The one-acre lot is also home to a one-bedroom guest house and an in-law apartment.
↑ For the thrifty member of the nouveau riche looking to score a deal on their next mansion, this Woodside spread might be just the thing. The 13,000-square-foot French-style estate was built in 1929 and recently listed for as much as $21M, with seven bedrooms and nine bathrooms on roughtly five acres of land, nine miles from Facebook HQ. Le Soleil, as the property is known, is set to be auctioned off to the highest bidder on June 14, which makes this a good fit for a Facebooker, provided one of his or her colleagues doesn't swoop in and pay the "buy it now" price of $12.95M.
Rate Survey: Credit Card Interest Rates Stay Flat a 5th Week Fox Business
By Kelly Dilworth Interest rates on new credit card offers remained unchanged for the fifth straight week, according to the CreditCards.com Weekly Credit Card Rate Report. The national average annual percentage rate (APR ) on new card offers stayed put ...
Washington Real Estate Investment Trust Amends and Extends Credit Facility MarketWatch (press release)
In addition, the amendment lowers the interest rate to LIBOR plus a margin of 107.5 basis points (previously 122.5 basis points) based on WRIT's current credit rating and eliminates the requirement for guarantees from WRIT's subsidiaries under certain ...
James Monahan, 42, New York, New York, the owner of a real estate investment company called Panam Management Group Inc., and Edward Adams, 69, New York, New York, an attorney, have been arrested on mail and wire fraud charges for allegedly operating a fraudulent real estate scheme.
Rosa Galope, Surprise and Avondale, Arizona, had a complaint filed against her alleging that she defrauded homeowners looking for help in obtaining mortgage modifications and saving their homes from foreclosure.
Loan Rate Increase Sparks Concerns Georgetown University The Hoya
By Meghan Patzer The looming expiration of the interest rate for Stafford loans on July 1 has university administrators and student representatives concerned. Stafford loans, which comprise subsidized and unsubsidized student loans granted by the ... Ultimatum: Cut Health Care Or We'll Let Student Loan Rates DoubleBob Englehart | Englehart's View (blog)
These are mortgage foreclosures filed with the civil division of the Circuit Court in November. Names in bold are the subject of or have an interest in the foreclosure action. Lighter names filed the foreclosure action.
(Reuters) - Billionaire investor Warren Buffett sought to buy Residential Capital (ResCap) from Ally Financial before the U.S. auto and mortgage lender put its home-lending unit into bankruptcy, Bloomberg said, citing three persons familiar with the matter. The news agency said Warren Buffett, Berkshire Hathaway Inc's controlling shareholder, appointed investment manager Ted Weschler for talks ...
HOUSING: Foreclosure rate half of what it was a year ago North County Times (blog)
The foreclosure rate in April was half what it had been 12 months earlier in both North San Diego and Southwest Riverside counties, hinting that a six-year foreclosure crisis may be drawing to a close, analysts and data indicated Thursday. A housing...
RATES DROP AGAIN: Average U.S. rates for 30-year and 15-year fixed mortgages fell to record lows for the third straight week, according to a survey by mortgage buyer Freddie Mac.RECORD LOWS: The rate on ...
-Central VA real estate news, trends and opinions » read more ..
Highlights:
- Days on Market (an inherently flawed data point, yet still relevant trend) are down in Charlottesville, Albemarle and Fluvanna.
- Average Sales prices are down (not surprising)
- Total sales across the MSA are down (not surprising)
- Total inventory is down. (this may not be a good thing, but so far this year, it has been perceived as good in Charlottesville) see: Reason & Matrix
Thoughts/initial conclusions:
- More buyers are looking to be closer in/closer to stuff
- Good properties are selling and selling quickly
- Interest rates remain low – a good thing for buyers.
- I think we may have pulled the spring market forward a bit; the early spring may have pulled transactions into the earlier months of the year.
Dead simple Takeaways:
- Buyers: do your due diligence, don’t let emotion enter the equation and make sound, rationale decisions with the intent of holding the property for at least five to seven years
- Sellers: do your due diligence and realize that buyers most often don’t have to buy, but want to buy – it’s your job to make them want to buy your house. This means: price, presentation, perfection … and a great location and setting.
Marshall C. Ezell, III, Georgia, pled guilty to four counts of Residential Mortgage Fraud (O.C.G.A. § 16-8-102) for making false statements during the mortgage lending process.
WASHINGTON, May 17 (UPI) -- Average mortgage rates for long-term, fixed-rate loans fell to record lows for the third consecutive week, the Federal Home Loan Mortgage Corp. said.
Mortgage rates have continued to fall over the past week, setting record lows for both 30-year and 15-year contracts, mortgage giant Freddie Mac said Thursday. The 30-year benchmark now stands at 3.79 percent, down from 3.83 percent a week ago, with an average "point" fee of 0.
Mortgage rates hit record lows in the week ending May 17, with the 30-year fixed-rate mortgage average falling to 3.79% from 3.83% in the prior week, Freddie Mac said Thursday in its weekly report.
Average U.S. rates for 30-year and 15-year fixed mortgages fell to record lows for the third straight week. The rate on the 30-year loan dipped to 3.79 percent. The 15-year mortgage, a popular option for refinancing, declined to 3.04 percent.
Britain's Daily Mailreported earlier this week that embattled Hollywood starlet Lindsay Lohan was renting this hillside villa in Beverly Hills for $25K per month. While this is indeed Lohan's walled retreat, she is apparently paying far less than the claimed $25K for the pleasure of staying there. According to E! and The Real Estalker, Lohan, who dropped out of her rehab program at the Betty Ford Clinic due to financial difficulties, is probably spending more like $9K per month for the glamorous, if not gigantic, pad. The house does have plenty of space for Lohan's family, with four bedrooms and five baths, but few flashy features beyond the sizable swimming pool.
· Lindsay Lohan Leases in Beverly Hills [The Real Estalker]
· Revealed: Lindsay Lohan embraces love of old school Hollywood glamour by renting $25,000 a month Beverly Hills bolthole [Daily Mail]
We need local news reporting; here’s hoping the Berkshire Hathaway purchase provides better local news writing and reporting by the DP.
For those of you interested in the residential real estate market, today’s interest rates (~4%) look pretty good in comparison, don’t they?
The $400 million first lien term loan will have an interest rate of 10.5 percent, which could step down to 9 percent if total leverage were to reach 3.50x. The new loan will be issued at a discount of 11.5 percent and is secured pari passu with the company’s existing 11-3/4 percent senior secured notes due 2017. The closing date of the new credit agreement is expected to be no later than May 24. The existing term loan in the amount of approximately $364 million will be fully repaid the same day the new credit agreement becomes effective. Media General now expects total cash interest expense in 2012 will be approximately $67 million. Total interest expense, including non-cash amortization of issue discount, new issuance fees, and the warrants, is expected to be $80 million in 2012.
David C.H. Lin, 44, Sunnyvale, California, an attorney, was convicted by a federal jury of conspiracy to commit mail and wire fraud, and multiple counts of mail and wire fraud in connection with his role in a private money lender scheme.
Tashia Winstanley, 38, Holly, Michigan, and her company, TLW Mortgage Solutions, face criminal charges for her role in a foreclosure-rescue fraud operation that scammed at least 60 victims across the state out of $250,000.
Can you imagine what your life would be like if you didn't have to send checks to creditors and lenders every month? How much money you'd be able to put aside for retirement, vacation, and other goals?
East Allegheny budget keeps real estate tax rate steady Pittsburgh Post Gazette
By Anne Cloonan East Allegheny school directors have approved a $30.7 million preliminary budget for the coming 2012-2013 school year that would hold real estate taxes at 27.54 mills. Toni Valicenti, district business manager, said estimated expenses ...
In a case started from a review of SARs, a specialized mortgage fraud task force launched an investigation that led to charges against two individuals.
It’s time to share my Three Cents Worth on Curbed NY, at the intersection of neighborhood and real estate in the capitol of the world. And I’m simply here to take measurements.
Since the Euro is creaking under the prevailing sentiment that Greece will flee, I thought it would be interesting to take a look at how Manhattan looks from Europe and the UK’s perspective. I threw in Canada and Australia for good measure. I applied their currencies against the US dollar and the Manhattan inflation adjusted average sales price (dark blue line)…
In the past few days there have been some pretty serious announcements of high end sales in the Manhattan apartment market. First there was the $52M co-op sale at 740 Park Avenue and then there was the $70M condo sale at 50 Central Park South. The former was a record – the highest sales price of a co-op apartment in Manhattan history and the second was a near record sale for a Manhattan condo. One could say this $70M sale was the highest arm’s length condo sale in history since it appears from what I’ve read that the $88M sale at 15 CPW a few months ago was more of a global divorce strategy play.
In appraising we use the “paired sale” technique to extract what certain amenities are worth. One could argue that these 2 recent sales were very similar:
Both were about 10,000 square feet.
Both are duplexes (2 levels).
Both had terraces.
Both located on well known streets/addresses.
Both were located in pre-war buildings.
Both sold at about the same time.
Both appeal to an affluent buyer who doesn’t require financing.
Simplistically speaking the key differences are the form of ownership (co-op v. condo) and the view. The 50 CPS property has full frontage on Central Park, the most sought-after view in Manhattan. The 740 Park Avenue is located on the 12th and 13th floor has city views that do not clear the roof lines of most buildings in the immediate area.
In our market, the premium for a Central Park view can be about 25% of an apartment’s value. In our co-authored research paper on Manhattan co-op v. condo value with NYU Furman Center, the inherent difference in value between a co-op and condo after controlling for all differences is about 9%.
25% + 9% = 34%
This 34% total is pretty consistent with the 34.6% difference between the $52M co-op and the $70M condo sales prices.
So the numbers aren’t so crazy after all.
Wynn lands Ritz-Carlton penthouse for $70M [The Real Deal]
Park Avenue co-op sells for record $52.5 million [CNN/Money]
Fertilizer King Rybolovlev Sued By Wife For $88 Million 15 CPW Purchase [NYO]
The Condominium v. Cooperative Puzzle: An Empirical Analysis of Housing in New York City [Miller Samuel]
Interest Rate Roundup Mortgages CDs Auto Loans Home Equity Credit Cards Find the best mortgage rates in your area. Mortgages 3.97% (30-year fixed) 0.44 (average points)Mortgage rates reached record lows, ...
Other data also pointed to recovery in the market. The delinquency on U.S. home mortgages fell in the first quarter to the lowest level since 2008, though the share of homes in the process inched higher, the ...
Flagler County foreclosure rate worst in Florida Daytona Beach News-Journal
By TOM KNOX, Business writer It's the second time this year that the county earned the distinction. The county had the worst rate in February, too. The county has continually ranked near the top of the foreclosure heap since the housing market streaked ...
Chile Seen Leaving Rates on Hold as Global Woes Threaten Growth Bloomberg
Chile's central bank will leave its benchmark interest rate unchanged for a fourth straight month today as Europe's debt crisis deepens, dimming growth prospects in the world's top copper producer, a survey showed. Policy makers, led by bank President ...
Interest Rate Cut to Benefit Homeowners San Francisco Chronicle (press release)
Leading mortgage broking group, The Mortgage Gallery Rockingham assists clients in order to help them take advantage of the new interest rate adjustments in the banking sector. Perth, Western Australia (PRWEB) May 17, 2012 The Mortgage Gallery ...
No Need to Raise Malaysian Interest Rates, Governor Zeti Says Bloomberg
Zeti Akhtar Aziz, Malaysia's central bank governor, comments on interest rates, inflation, economic growth and consumer debt. She made these remarks in a Bloomberg Television interview in Istanbul. On whether there's a need for monetary policy ...
U.S. mortgage delinquency and foreclosure rates have fallen to their lowest levels since 2008, according to a new Mortgage Bankers Association (MBA) report.
NEW YORK, May 16, 2012 /PRNewswire/ -- Mortgage rates fell for the seventh time in the past eight weeks and set a new record for the fourth consecutive week. The average rate on the benchmark 30-year fixed ...
Greater Toronto Realtors reported 5,142 transactions through the TorontoMLS System during the first 14 days of May 2012. This result was up by more than 14.5 per cent in comparison to the first 14 days of May 2011. The number of new listings continued to grow at a slower pace than sales – up 13 per cent year-over-year to 8,749.
“Annual growth in sales was experienced across the GTA for all major home types in the first half of May. Sales growth was strongest for the condominium apartment segment. While the condo market has generally been the best supplied market over the past year, we have continued to see enough demand to exert moderate upward pressure on average selling prices in this market segment,” said Toronto Real Estate Board President Richard Silver.
The average selling price for transactions in the first 14 days of May was $517,242 – up by six per cent compared to the same period in 2011.
“A shortage of listings in the low-rise segment of the market has resulted in a lot of competition between buyers and above average annual rates of price growth. Tight market conditions are expected to remain in place for the balance of 2012,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.
Yesterday, after news broke that Ryan Seacrest dropped $37M on Ellen DeGeneres and Portia de Rossi's Beverly Hills compound, an anonymous Curbed commenter mused: "I can't imagine that Ellen is going to be living full time in Malibu"—you'll recall that she just bought Brad Pitt's place there—"what can you really upgrade to from here??????"
To answer your question, bro, it turns out the comedian—and recent winner of the Kennedy Center's Mark Twain Prize for American Humor—and her actress wife are rumored to have purchased another place in Beverly Hills for somewhere in the range of $17M to $18M. According to The Real Estalker, the glassy midcentury modern was originally designed in 1958 by Hal Levitt (these days, he's quite a popular architect with the celebrity set), featured in a 2001 Versace ad campaign, and previously owned by celebrity decorator Kelly Wearstler, who did up the place in her signature, blinged-out maximalist style before photographing it for a decorating monograph.
The 8,500-square-foot main house has only four bedrooms—quite a lifestyle change from the nine DeGeneres and de Rossi enjoyed at the place they just sold to Seacrest—but plenty of space for their famous art collection, not to mention some gorgeous-looking landscaping and a modern marble pool. Wonder if that stainless steel kitchen comes with the private chef (above, second listing photo, above). The place was listed for "From $20,000,000," so there's a good chance he got cut out of the deal.
Last week, I stood in the long line at the Phoenix Sky Harbor security checkpoint like a lamb being led to slaughter. The short line, the one that guys in fancy suits get to use, was strictly forbidden because I didn’t know the secret handshake. I also lacked preferred silver diamond elite status.
I boarded the plane with the Zone 5’ers and passed by the first class passengers as they sipped their free booze and closed multi-million dollar deals on their smartphones. Worse, these stuffy elitists refused to make eye contact with me as I made my way to coach, where I would go to suffer with the rest of the commoners for the next three hours.
Then it dawned on me as I took my middle seat in aisle 27. I’m a 2nd class citizen of the air travel world.
In case you haven’t heard the news, the greater-Phoenix area is a seller’s market again. Inventory levels are down and prices are up. Cash buyers accounted for 40% of all sales in March. And this new phenomenon has turned FHA loan approved buyers into the 2nd class citizens of the housing market.
Why?
For starters, FHA loan approved buyers have very little, if any, cash to put down on their home purchase. In rapidly appreciating markets like Phoenix it’s difficult for appraisers to keep up with values. If you’re a home seller or fix and flipper like me and are under contract with an FHA buyer what happens if your house doesn’t appraise for the offer price? You either lower it to match the appraised value or put the house back on the market. Neither option is very attractive.
If you’re a home seller and are under contract with an FHA buyer and the house does appraise you’re still not out of the woods. The FHA requires a second appraisal, usually ordered about 5-7 days prior to closing. The FHA honors the lower of the two.
Then there’s the inspection. The FHA has a laundry list of stuff that must be done in order for them to approve a buyer’s loan. Last year, I flipped a house to an FHA approved buyer that didn’t ask for any repairs. After the home inspection was complete the FHA came back and required I fix a bunch of stuff – to the tune of $1,500. Even worse, they had to send the inspector back at my expense to verify the items had been corrected, which pushed out the closing one week.
This is why many FHA borrowers are getting squeezed out of the market. They are the last people a home seller wants to deal with. Sellers here know that over asking price offers likely won’t appraise. The only way to get a deal done is to find a cash buyer, or a conventional buyer with enough cash to cover the difference if the appraisal comes back low.
So if you’re an FHA approved buyer what do you do?
I recommend you put more money down. That lets the seller know you can at least make up some of the difference if the appraisal doesn’t match the offer price. If you don’t have any money to put down then save some and buy later. Homeownership is not a life or death proposition.
The alternative is you get treated like a 2nd class citizen. But take it from me; it’s not that bad. Just be prepared to wait in a long line before finally getting to your seat.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
WASHINGTON, May 16 (UPI) -- The Mortgage Bankers Association said U.S. mortgage activity rose 9.2 percent in the week ended Friday with interest rates hitting record lows.
New App Helps Real Estate Agents and Investors Project Cash Flows MarketWatch (press release)
Capital expenditures can be projected by year and by tenant. Projected sale value can be based on price appreciation, capitalization rate, or even a discount rate with perpetual growth formula. It is probably the only real estate app that can project ...
In another flicker of hope for the battered housing markets, home loans in foreclosure or at least one payment past due have declined to the lowest level since 2008, according to a Mortgage Bankers Assn. delinquency report .
The number of depository institution SARs identifying Mortgage Loan Fraud as a Characterization of Suspicious Activity continued to rise (up 30.6% in calendar year 2011).
Looks like Ryan Seacrest didn't pay quite what Ellen Degeneres and Portia de Rossi wanted for their sprawling Beverly Hills compound: the Journal has reported the final sale at $37M. In what universe is that a steal? One where the property was originally hoping to snag a buyer for $60M. [previously; WSJ]
James D. Levitt, 66, Pawtucket, Rhode Island, a disbarred real estate attorney, was sentenced in U.S. District Court in Providence to 12 months and one day in prison and fined $25,000 for his role in a $1.1 million mortgage fraud scheme.
NEW YORK, NY-- - High yielding mortgage REITs have performed admirably in 2012. The Vanguard REIT ETF is up more than 12 percent-year-to-date. REITS have continued to take advantage of low interest rates ...
When June Snow first looked into refinancing her interest-only mortgage, she was told it would be impossible because the value for her three-bedroom, two-bath ranch style home was not in the necessary range.
Applications for U.S. home mortgages surged last week, driven by increased demand for refinancing as interest rates hit fresh lows, an industry group said on Wednesday. The Mortgage Bankers Association ...
Ashley Lacerda, 32, Egg Harbor Township, New Jersey; Francis Santore, 52, Northfield, New Jersey; and Brian Corley, 27, Egg Harbor, New Jersey, are being arraigned on charges of conspiracy to commit mail and wire fraud, mail and wire fraud, and conspiracy to commit money laundering in a $2.6 million time share mortgage fraud.
K&R Marketing LLC, doing business as Fix My Mortgage Problem, is the subject of a civil lawsuit. The lawsuit charges the business and its owner with multiple violations of Ohio's consumer laws, including failure to deliver.
The first three months of 2012 brought with it little new momentum. The Eurozone’s debt debacle remained at the forefront of the global economic agenda, several critical elections were on the horizon (Russia, France, Greece) and Asia’s highly-effective cooling measures showed no sign of being relaxed. Against this backdrop some luxury buyers took to the side-lines to observe their market’s trajectory.
Primary markets seem to be cooling off a bit. I thought the conclusion was quite powerful.
The safe-haven argument still resonates. Capital flight will continue to focus on cities with low political risk, transparent legal systems, good security and ideally those with an HNWI-friendly tax regime.
About five years ago, The New York Observer started a publicity campaign called The Power 100 where they selected 100 notables in New York Real Estate circles, put them on a list and threw a party to build loyalty and hopefully attract advertisers. It was a fun thing to be a part of. It wasn’t scientific and it wasn’t a serious endeavor nor was it taken seriously. It was just fun and created appreciation from those selected.
I was part of the list in three of it’s first four years. Myself and many others blogged about it. The effort got a lot of attention for NYO which was the intent.
I’ve always liked and respected the reporters there (still do) and I love the flagship NYO publication. I’ve subscribed for years and have been a regular source of market information for the publication.
However this year the publisher changed the methodology by switching it to their other publication The Commercial Observer and excluded media types and most residential types unless you owned a brokerage or sold a few apartments north of $20M.
Of course I’m down with that.
However I didn’t expect the publication to be mean about it. (Not to be confused with snark.) The Commercial Observer published a list of who was cast off (your’s truly) without disclosing the methodology change.
Imagine your kid applying to college but they don’t get accepted – only the college decides to publish their name in a list with all those who weren’t accepted?
I’m think the “Out” list is just as interesting as the “In” list – here’s a sample.
Bill Ackman – Pershing Square Capital
Serena Boardman – Sotheby’s
Timothy Dolan – Archbishop, RC Church of NY.
Steve Cuozzo – New York Post
Si Newhouse – Conde Nast
Howard Rubenstein – Rubenstein Communications
Steven Rubenstein – Rubenstein Communications
Sheldon Silver – Speaker NYS Assembly
Lockhart Steele – Curbed Network
Jay Walder – MTA
I’m going to start a new list “The Tepid 25″ since the word “Power” is a bit obnoxious.
Last week, I took my money from the close of HML #21 and put it to work in a new loan. The new property is a single family home in San Pablo, California. the property was purchased at a foreclosure auction by one of our best clients, who is also personally guaranteeing the loan. The purchase price was $111,600. My partner estimates the current as-is value to be $120,000 and the after repairs value to be $140,000. Our loan is for $74,000, giving us an LTV of 61% of the current value or 53% of the repaired value.
There are a fair number of comps for this property, ranging from $120,000 to $165,000, so our after repair value is smack in the middle of that range.
The property is a 3 bedroom, 1 bath home of 958 square feet. It was built in 1950. It's got a one car garage and sits on a 5,000 square foot lot. My partner's assistant rates the neighborhood as a C-, which is typical for most of the loans we make. He rates the loan safety as a B, given the low LTV ratio.
The exterior appears to be in average condition. There are no readily visible problems with the roof or foundation. The condition of the interior is unknown. There was at least one other bidder at the auction for this property.
Housing Starts Probably Rebounded From a Five-Month Low Bloomberg
Employment gains, cheaper homes and record-low mortgage rates are combining to lift demand and encourage builders to take on projects. At the same time, distressed properties are thwarting a quicker recovery in the housing market three years after the ...
Foreclosed Americans find way back to homeownership Reuters
Data is not available, but interviews with more than 30 lenders, builders, Realtors and consumers suggest that a growing number of Americans are getting back into the housing market, even though they went through a foreclosure, bankruptcy or short sale ...
WASHINGTON (Reuters) - The housing regulator for mortgage-giants Fannie Mae and Freddie Mac on Tuesday said laws under consideration in California to halt illegal foreclosures could restrict mortgage credit and hamper necessary home seizures. In a letter to California legislators, the Federal Housing Finance Agency disclosed concerns with a measure to increase civil penalties for so-called ...
I spend a fair amount of time writing “about” pages for clients. It’s much easier for someone else to talk about how wonderful you are, right? Right. That’s why it’s more difficult for me to talk about Getting...
***Visit the BRER Real Estate Marketing Blog to get the rest of the story!***
More Real-Estate Loans Default in Europe Wall Street Journal
By ELIOT BROWN European commercial-real-estate markets are struggling with a sharp increase in problem mortgages just as more European countries slip back into recession. A growing number of landlords, hit with falling rents and occupancies, ...
Because everything comes full circle in this crazy wheel of life, the fact that Ellen Degeneres recently bought Brad Pitt's compound in Malibu, Calif., meant that another celebrity would surely swoop in and scoop up the comedian's own palace, which hit the market in October. Sure enough, the stars aligned in such a way that Ryan Seacrest has bought the Beverly Hills, Calif., estate, which Degeneres shares with her wife, Portia de Rossi.
According to The Hollywood Reporter, the American Idol host paid close to the property's $49M ask—a staggering price, for sure, but not even close to the $60M the couple originally wanted. And it's certainly chump change for Seacrest, who has been earning $15M a year (although he may be forced to take a pay cut if his American Idol gig continues past 2012).
Now, a bit about the new digs: featured in Architectural Digest this past November, the home was designed by architects Buff & Hensman and later expanded by Will & Grace set designer Melinda Ritz. Inside the 9,200-square-foot, nine-bedroom main house are Degeneres and de Rossi's impressive art collection—including a Warhol-Basquiat collab, an Ed Ruscha, and a Serge Mouille chandelier—but surely these things will be hauled out and installed in the Next Big Thing. Besides, no one embraces moving around quit like these girls: "The first thing I did when I made money was buy a house," Degeneres toldArch Digest. "And then—” De Rossi interjects: “Another one. And another one and another one and another one..."
There have been a other posts here about the Penguin update by Google. Here’s another issue that has been raised by Penguin that you need to know about. Do you know what anchor text is most used for links coming into your website? Do...
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Residential Mortgage seeking Chapter 11 protection The government-owned lender had been weighing a bankruptcy filing for Residential Capital LLC for some time, as the division has been burdened by old, souring loans. Ally, which was formerly the financing arm of General Motors Co., says it is also exploring strategic options for all of its international operations, which includes auto finance ...
There’s been a lot of talk around the Internet and on this blog about the Penguin release by Google. And, it’s a good idea to keep up with the changes that happen. We will be tweaking our approach to SEO to respond to the latest...
***Visit the BRER Real Estate Marketing Blog to get the rest of the story!***
Oriental Bank slashes lending rates Zee News
New Delhi: State-owned Oriental Bank of Commerce (OBC) on Tuesday slashed interest rate on home and car loans by up to 1.5 percent. Besides, the bank has also announced loyalty benefit of 0.25 percent on the card rate for existing existing customers ... Oriental Bank slashes home, car loan ratesHindu Business Line
The bankruptcy of Ally Financial Inc.'s troubled mortgage business and potential sales of its international units will put the auto lender on stronger footing, Ally executives said Tuesday, despite questions about the ultimate fate of Ally's domestic operations.
Jennifer Aniston has notoriously modern taste when it comes to architecture and design. In November 2011, not long after her sleek, Arch Digest-anointed Beverly Hills hideaway hit the market, the actress settled on a gorgeous, gleamingly new unit on Gramercy Park in Manhattan. This January, she doled out generously for a 1965 A. Quincy Jones-designed modern in Bel-Air, Calif. Now Aniston and boyfriend Justin Theroux are paying $40K a month to rent a thoroughly renovated Hal Levitt design in Los Angeles.
But just because Jen's laying her flaxen hair here doesn't mean you can't too, eventually: according to Trulia Luxe Living, the five-bedroom home—which, with details such as white oak wide-plank flooring, "hand-chiseled stone flooring imported from Tandoor, India," hand-blown Venetian lighting, Ann Sacks tiling, a "Bulthaup B3 Walnut Floating Chefs Kitchen," and a temperature-controlled wine room, probably doesn't have much in the way of Levitt's original vision—is also quietly asking$11.5M. Curbed LA, which has covered this property extensively, took notice when it first came to market for $14.9M last July—the owner, who bought the 6,500-square-foot home for $4.6M in April 2010, was shooting for a nearly unheard-of flip. Perhaps an A-lister is just the kick in the caboose it needs to finally sell?
Residential Capital L.L.C., which was a big subprime mortgage lender and still employs 1,385 in Fort Washington, filed for bankruptcy protection in New York on Monday.
Carole Nelson, 53, Washington, D.C., was sentenced by U.S. District Judge Roger W. Titus sentenced to 29 months in prison followed by three years of supervised release for money laundering in connection with her participation in a massive mortgage fraud scheme which promised to pay off homeowners' mortgages on their "Dream Homes," but left them to fend for themselves.
NEW YORK, NY-- - High yielding mortgage REITs have performed admirably in 2012. The Vanguard REIT ETF is up more than 12 percent-year-to-date. REITS have continued to take advantage of low interest rates ...
Michael Anthony Prieskorn, 37, Ellendale, Minnesota, was sentenced on charges stemming from a mortgage fraud scheme that resulted in losses of at least $18 million for mortgage lenders.
Commercial real estate firm Avison Young opens Mount Pleasant office Charleston Post Courier
BY JOHN P. McDERMOTT The former Charleston arm of the fallen commercial real estate giant Grubb & Ellis expects to expand into Columbia and Greenville under a new relationship with a Canadian company. Toronto-based Avison Young's first South Carolina ...
China interest rates tumble on RRR cut, economic worries Reuters
* Seven-day repo falls below 3 percent * Yields on one-year government bonds fall to 2.96 percent * But rates may have limited room to fall further * Outflow of fiscal deposits will reduce impact of RRR By Gabriel Wildau SHANGHAI, May 15 (Reuters) ...
Residential Capital L.L.C., which was a big subprime mortgage lender and still employs 1,385 in Fort Washington, filed for bankruptcy protection Monday in New York.
The storied beer brand Guinness turned to London's Jump Studios to design the interior of their latest marketing gimmick: a submersible stationed in Stockholm harbor. The space-age interior is a seemingly-seamless design with a bubble-like graphic. Some of the "bubbles" have been lit with LEDs, while others are hollowed out to serve as cup holders or, should we say, pint holders. The submarine was commissioned as part of Guinness's 250th Anniversary celebration and some trickery was necessary to outfit the existing steel sub with a brand new interior using two tiny hatches. According to Arch Daily, "The components were made at the Nicholas Alexander workshop in London (after exact measurements were taken of the submarine from its base in Sweden) before being driven out to Sweden and assembled in sub-zero temperatures." Sounds like fun.
· Guinness Deep-Sea Bar / Jump Studios [Arch Daily]
Origen Financial Announces Termination of Interest Rate Swap Agreements MarketWatch (press release) ... a real estate investment trust that manages residual interests in securitized manufactured housing loan portfolios, today announced that the company has terminated certain of its interest rate swap transactions with Citibank NA pertaining to three ...
(Reuters) - Ally Financial Inc's mortgage unit filed for bankruptcy protection on Monday, and the former in-house financing arm for General Motors Co also said it will sell some international operations to help set it on a path to repaying $12 billion in U.S. government bailout money. The bankruptcy, which still needs court approval, came early Monday as ResCap faced looming bond payments and a ...
Existing and would-be home owners are being encouraged to "shop around" as banks slash mortgage rates.ASB last night became the latest bank to reduce its 12-month fixed home loan rate, down from 5.7 per cent to match Westpac and...
Troubled US Treasury-owned lender Ally Financial said Monday its was placing its mortgage unit into bankruptcy protection as the government seeks to reduce loss risks from a major $17 billion crisis-era bailout.
I am going to talk a little bit about the “moral side” of a short sale. My favorite part of this story… the twist at the end that makes the whole thing laughable.
I was reading this article on CNBC this weekend about short sales and felt I needed to jump into the discussion. The Phoenix Real Estate Guy has written a lot about short sales as they have been a major part of the Phoenix housing market for the last few years.
The premise of the article is, should people who can technically afford to pay for their underwater home continue to do so, or should they be allowed to walk away? Here is how the author sums up the situation:
These borrowers have the wherewithal to make their monthly payments on their underwater homes but choose not to, because they know they won’t make their equity back any time soon. They also see that they can now buy more home for less money, given how low home prices have fallen. They can get in at the bottom, rather than pay what amounts to rent on their current homes. In other words, they’re in a position to make more money by walking away from their debt and letting their lender eat the loss.
I’m no bank apologist, but is that fair?
When I have this conversation with home owners I always tell them, no matter what have been taught to think, what you are doing is making a business decision. If you invested $400,000 in a stock that was now worth $250,000, and was unlikely to return to $400,000 for another 10-12 years, would you continue to hold that stock or would you sell it and invest in a better option that will guarantee you a higher rate of return?
Most agree when I phrase it like that it is a no brainer. There is always the follow up thought, but they signed a contract.
You should follow Thompson’s Realty on Twitter here.
But they signed a contract
Sure they did, but there are always options. Right inside all home contracts it lays out exactly how these options will work. You as the home owner have the option of stopping to make payments. If you chose to stop to make payments, then the bank has a right to take the property back.
In every situation, when we sit down with a someone considering a short sale we discuss this. If you are no longer happy with the terms of the contract, then the bank is giving you a way out. How is this different than what businesses do every day? They look at their bottom line and when things are bad they make changes.
You have options
You do have options, they are listed right in the original contract you signed. You can stop paying, and the bank can take the property back. But there is another option. The other option is you can renegotiate a contract. That is exactly what a short sale is. The seller goes to the bank says I am not happy with this situation. I would like to renegotiate the contract and agree to give you $xxx,xxx.00 for the home now instead of continuing our current business agreement. The bank then has an option of agreeing to this renegotiation because it is better than the foreclosure alternative, or no they can decide not to agree and instead foreclose. Both sides have options here.
So even though both sides have options, obviously the Mortgage Bankers Association is not happy with the results. Showing his frustration over the situation, John Courson, chief executive of the Mortgage Bankers Association said of those looking to short sale “What about the message they will send to their family and their kids and their friends?”
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
William E. Baker, 66, Chico, California, was sentenced by United States District Judge Edward J. Garcia to 18 months in prison, to be followed by three years of supervised release. Baker pleaded guilty to mail fraud for his involvement in a mortgage fraud scheme.
PLAINFIELD — About two dozen people picketed the Wells Fargo Home Mortgage office in downtown Plainfield on Monday to publicize a Joliet woman’s foreclosure troubles. The group, organized by the Chicago Anti-Eviction Campaign, chanted slogans and carried signs that said: “Wells Fargo Stealing Homes,” “Housing is a Human Right” and “Wells Fargo Doesn’t Need This or Any House.” Loleta Barrow ...
Juan Carlos Rodriguez, 52, Weston, Florida, a real estate agent and mortgage broker, pled guilty before U.S. District Judge Kenneth A. Marra for his participation in a mortgage fraud scheme relating to properties in the Versailles development in Wellington, Florida.
Ally Financial Inc.'s mortgage unit on Monday filed for bankruptcy and the auto lender said it will sell some international operations to help set it on a path to repaying $12 billion in bailout money.
Ally Financial's ResCap mortgage unit filed for a prepackaged bankruptcy protection Monday, a move that the taxpayer-owned bank says will allow it to take another step to repay Treasury.
Residential Capital. the mortgage unit of Ally Financial, filed for bankruptcy on Monday, a move aimed at removing Ally's biggest obstacle to its turnaround efforts.
Gaia Real Estate and Starwood Capital Acquire 9500 Unit Multifamily Portfolio ... MarketWatch (press release)
NEW YORK and GREENWICH, Conn., May 14, 2012 /PRNewswire via COMTEX/ -- Gaia Real Estate and a controlled affiliate of Starwood Capital Group, a leading global private investment firm, announced today that they have agreed to invest $22.5 million of new ...
Hedge-fund manager Philip Falcone's LightSquared Inc. venture is preparing for a potential -protection filing, as negotiations with lenders to avoid a potential default faltered, according to people familiar with the matter. The two sides still ...
Washington — The struggling mortgage unit of Detroit-based Ally Financial Inc. is expected to file for bankruptcy in New York early today after the board of directors met Sunday, according to two people briefed on the matter.
Borrowers flock to fixed rates Sydney Morning Herald
Borrowers flocked to fixed-rate loans in March, driven both by attractive pricing and uncertainty about future official interest rate movements. Australians took out 7060 fixed rate loans in March, in original terms, or 14.5 per cent of total home ... Pass on rate cuts: NFFWeekly Times Now
Is the Government Backing a New Housing Bubble? The Fiscal Times
Compare this to a traditional mortgage offered by a private bank. Private banks require large down payments of buyers – traditionally 20 percent – to qualify for a low interest rate. After the housing bubble burst forcing the United States into the ...
Delinquent mortgage rate at 3-year low Middletown Journal
The decline of delinquency rates in the Cincinnati-Middletown MSA are likely the result of several factors, according to Ed Hensley, first vice president and director of mortgage lending at First Financial Bank. "The first factor is a lot of the loans ...
Supreme Court ruling could add costs to distressed debt investors Pensions & Investments
A pending US Supreme Court ruling could make life more expensive for money managers that invest in distressed real estate debt. If the court overrules a lower court decision, it would effectively end the practice of credit bidding in bankruptcy...
With property prices currently sagging, more and more investors are looking towards real estate as a smart addition to an investment portfolio. Certainly there is money to be made in property, but there is also a great deal of risk involved.
Recession added debt, drained families' savings USA TODAY
By Christine Dugas, USA TODAY The economy may be improving but many American families are still weighed down by debt and without a safety net. One out of five families owes more on credit cards, medical bills, student loans and other unsecured debt...
Florida is now sitting on about $300 million in mortgage-settlement funds, and everyone from real-estate agents to victimized homeowners has been advising state Attorney General Pam Bondi on how to spend it.
Ally Financial Inc's Residential Capital unit is nearing a bankruptcy filing, sources familiar with the situation said on Sunday, in a move that could help the taxpayer-owned auto lender to shed its troubled mortgage business but also spur drawn-out legal fights.
Florida is now sitting on about $300 million in mortgage-settlement funds, and everyone from real-estate agents to victimized homeowners has been advising state Attorney General Pam Bondi on how to spend it.
Ally Financial Inc's Residential Capital unit is nearing a bankruptcy filing, sources familiar with the situation said on Sunday, in a move that could help the taxpayer-owned auto lender shed its troubled mortgage business but also spur drawn-out legal fights.
Ally Financial Inc's Residential Capital unit is nearing a bankruptcy filing, sources familiar with the situation said on Sunday, in a move that could help the taxpayer-owned auto lender to shed its troubled ...
Real estate may be one of the most attractive investment opportunities today. With mortgage rates near all-time lows and national real estate values down more than 34 percent since the highs in 2006, it may be a great time to take a look at making a home purchase.
Boynton Beach, Fla. offers real estate bargains NorthJersey.com
Boynton's biggest draw could be its cut-rate real estate in an area known for pricey property. Although housing costs have risen overall since its beneath-the-radar days, the national meltdown has left the city with home values about half of what they ...
Your Money: Some online banks' interest rates can help boost your savings Indianapolis Star
When the Federal Reserve pushed interest rates higher in the late 1970s to bring down inflation, angry farmers drove their tractors to blockade the Fed's Washington, DC, headquarters. The Fed's current stance on interest rates has just as many ...
The mortgage unit of Ally Financial plans to put itself into bankruptcy, according to people briefed on the matter, allowing the bank to effectively remove the biggest obstacle to its turnaround efforts.
Real estate agent ranking site rankles its neighbors Boston Herald
By Paul Restuccia Just back to Boston and looking to buy, Michael Wilson, 35, and his wife, Kerry Williams, found an Internet real estate referral service called NeighborCity that not only matched them with an agent that found them a condo, ...
Mortgage shy: Ranks of buyers dwindling Minneapolis Star Tribune
Whether bruised by the housing crash or battered by the economy, more people are taking a pass on homeownership. The percentage of homeowners in Minnesota has fallen to its lowest level in almost 20 years, as demand grows for rental housing at a time ...
Real Estate Taxes: Owners May Face More Fees And Interest The Ledger
Polk County Tax Collector Joe G. Tedder said any property owners who have not paid their 2011 real estate taxes by 5 pm May 31 could face additional interest and fees. That's because Tedder's office will begin selling tax certificates June 1 to recoup ...
The Homes.org weekly mortgage rate keeps buyers and sellers updated on what's happening with mortgage interest rates across the U.S. The in-depth report provides details on what’s affecting today's mortgages - current average rates, the latest economic activity and forecasts for what's likely to happen in the mortgage market.(PRWEB) May 12, 2012 The record low mortgage interest rates continue on ...
It’s time to share my Three Cents Worth on Curbed NY, at the intersection of neighborhood and real estate in the capitol of the world. And I’m simply here to take measurements.
With all the hoopla about record low mortgage rates, the resurgence of entry-level buyers despite the headline-creating high end market, entering the “gray” area of rent versus buy, I thought I’d take a look at how falling mortgage rates impact the size of apartments being sold. The logic being that smaller apartments thrive as rates fall. I recognize that there is a lot more nuance in the size of what sells at any given time, but hey, this is Curbed…
WASHINGTON (AP) — Average U.S. rates for 30-year and 15-year fixed mortgages fell to fresh record lows this week. Cheap mortgage rates have made home-buying and refinancing more affordable than ever for those who can qualify.
Tracking your expenses is an important step in creating a debt plan. It's a prerequisite to creating a budget and figuring out how much you can afford to put toward debt repayment.
Blake Lively may play a wild, oft-reckless urban sophisticate on Gossip Girl but lately the actress has been seem embracing a more quaint bedroom-community lifestyle. She and main squeeze Ryan Reynolds have made news for slurping down chocolate milk and dining at the ritzy Bedford Post Inn in Bedford, N.Y. (where they may or may not have clashed with the locals), and were even rumored to have purchased property there.
Well, today The Real Estalker finds out the true reason why America's favorite bombshell has been spending so much time in Martha Stewart horseland: she (and she alone) bought a house there for $2.35M in January.
Judging by a rough crop of exterior listing photos, Lively's new digs aren't exactly what one would expect from a young starlet, with old-timey details such as yellow clapboard siding, and "Cntry kitchen," a cozy sunroom, and covered porch. Then again, fellow 20-somethings like Taylor Swift and Lea Michele have both recently opted for country charm over anything too modern. Kind of redefines the whole "girl next door" thing, eh?
The Search for Income: Floating-Rate Senior Loans Morningstar.com
But by August, after the Fed made clear its intention to keep interest rates low into the foreseeable future, flows quickly turned negative. The bank-loan category lost $7.2 billion in August alone. During the first quarter of 2012, the category saw a ... Bank-Loan Funds: A Risky Reach for YieldBusinessWeek
It's fair to assume that the "most kick-ass fucking roommate that ever lived" has had a long and prosperous nine months. As you recall, he's the 25-year-old who put out an F-bomb-laced Craigslist ad looking for a housing share in San Francisco last August. Calling upon his experience as a "professional marketing agent with experience at bad-ass companies in New York Fucking City," the MKaFRTEL, as he shall henceforth be called, extolled a long list of selling points to prospective roommates: "I'll fry green tomatoes, cover them with marinated crab meat and smother that shit in bearnaise. EVERY. GODDAMN. NIGHT." He also demonstrated his racism-less worldview: "A lot of people ask me, 'Hey, you're from Alabama. Are you racist?' And, the answer to that question is, no. I'm not racist or judgmental at all. I love everyone. I'm a secular humanist. I FUCKING LOVE PEOPLE."
Anyway, it seems humor site Funny or Die has found the MKaFRTEL. Watch the parody below.
Habitat for Humanity Tries Big-Scale Approach to Housing in Oregon New York Times
John D. Gray, 92, got wind about three years ago, near the bottom of the Great Recession, that Habitat for Humanity was doing something pretty interesting here in Oregon's largest city. In a depressed real estate market, Habitat, the nonprofit housing...
One of the most subservient organizations to the federal government has had enough of government regulations and is fighting back. The National Association of Home Builders has gone along with the myriad of government programs that lined the pockets of the connected and delayed the recovery of the housing industry for the past 5 years.
Now they have finally seemed to recognize that the government intrusion into the housing industry has created a crisis and home construction, a vital part of our economy, will not recover until the American families see some relief from the rampant increase in government regulation.
PRESS RELEASE:
WASHINGTON, May 11 – Despite the fact that Americans overwhelmingly support homeownership, legislative and regulatory proposals now under consideration would greatly harm home owners, home buyers, the housing market and the nation’s economy. The National Association of Home Builders (NAHB) has launched a new website, www.ProtectHomeownership.com, to bring attention to the threats to homeownership and inspire the public to take action to protect it.
“American families aspire to homeownership because they know that it promotes stability and is critical in creating wealth and providing upward mobility and financial security for families. Equally important, homeownership supports the economy by creating jobs,” said NAHB Chairman Barry Rutenberg, a home builder from Gainesville, Fla. “Government policies that negatively impact families’ ability to own a home would be devastating for home owners, the housing market and the nation’s economy.”
Tax, legislative and regulatory policies currently under consideration would scale back or eliminate the mortgage interest deduction and make mortgages and small business loans unaffordable and even more difficult to obtain. ProtectHomesownership.com explains some of these threats and documents homeownership’s importance to individual households and to local, state and national economies through an FAQ, poll data, economic analysis and reports.
The site also provides multiple ways for the public to take positive action to protect this very important aspect of American life. These include an online petition urging policymakers to keep housing a national priority, information about how to participate in homeownership rallies that are being held in a number of communities in 2012, and links to social media communities on Facebook.com/ProtectHomeownership and Twitter.com/4Homeownership.
“New home construction spurs productivity, creates jobs for millions of Americans and generates revenues for all levels of government,” said Rutenberg. “This website will help educate the public about the imminent threats to the American Dream of homeownership and empower them to make sure their voices are heard.”
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
Skateboarder turned MTV personality Rob Dyrdek already has a "fantasy factory," so it's clear he didn't need much inspiration from his home in the Hollywood Hills. The 4,700-square-foot pile is outfitted in the most half-assed modern fashion, with the obligatory metallic chandeliers, huge flat-screen TVs, and a rear pool area that, even with the row of jungle-like plantings, comes off looking like a prison yard with a swimming pool. That's not to say the place doesn't have its virtues, among them a cavernous master bathroom with dual showers and a separate windowed bathtub, four additional bedrooms, a grand entry with 20-foot ceilings, and a media room. Dyrdek, who got his start as a skateboarder before turning to MTV to produce Rob & Big and Ridiculousness, has the house listed for $2.6M.
· 2431 Apollo Drive [Realtor.com]
· Ridiculousness: Rob Dyrdek Lists Swank L.A. Crib for $2.6 Mil [Realtor.com]
Deutsche Bank AG, DB Structured Products, Inc., Deutsche Bank Securities, Inc. (collectively "Deutsche Bank") and MortgageIt, Inc. have entered into an agreement settling a lawsuit filed by the United States, which alleged HUD misreprsentations.
A homeowner's lawyer told the Florida Supreme Court on Thursday that the justices can strike a blow against rampant fraud by prohibiting lenders from simply voluntarily dismissing mortgage foreclosure cases to avoid penalties for filing bogus documents.
Zero Sushi is open for business! The latest venture from the guys who own La Plancha deli Mar is in the old Happy Fish space on the second floor of the Marketplace.
They opened for business midweek. The initial come-on: Free Sake. All you had to do was mention Facebook and you got the beverage free with your meal.
On the menu: Spicy tuna, green onions, yellowtail snapper, pineapple salsa, and sesame and garlic seared salmon sashimi.
There's a benefit at Skinny Legs Sunday afternoon. The horseshoe pit is going to be full with good food, and good people. A tournament begins at 2 p.m. BTW, the Skinny Facebook page is becoming quite active, populated with news, notes, and pictures.
Thinking about a Memorial Day weekend island visit? Caneel Bay's offering a Dive into Relaxation" with room rates 30 percent off, beginning st $338. Free breakfast, a sunset cocktail cruise and "special welcome gift" are included. The deal is hoping to hook some people who plan to compete in the Beach to Beach Power Swim organized by Friends of the VI National Park. Caneel invites both swimmers and spectators.
WASHINGTON - Average U.S. rates for 30-year and 15-year fixed mortgages fell to fresh record lows this week. Cheap mortgage rates have made home-buying and refinancing more affordable than ever for those who can qualify.
Britain’s biggest mortgage lender yesterday increased its rates, despite the Bank of England keeping the base rate at 0.5 per cent for the 38th month in a row.
Brown and Warren Disagree on Student Loan Interest Rates Harvard Crimson
By Elizabeth S. Auritt, CRIMSON STAFF WRITER Interest rates on student loans have become a point of contention between US Senator Scott Brown and Harvard Law School professor Elizabeth Warren in the 2012 US Senate race in Massachusetts.
Britain’s biggest mortgage lender yesterday increased its rates by up to 0.3 percentage points despite the Bank of England keeping the base rate at 0.5 per cent for the 38th month in a row.
A few days ago, a post by Felix Salmon at Reuters caught my eye: Chart of the day: Let’s go buy a house! Yesterday he asked me to send similar data for NYC and would run the same chart. I sent over 20 years worth of median sales price and median rental price (face) data for Manhattan and he punched one out: Rent vs buy, Manhattan edition laying the results on top of the US data.
He’s running a payment equivalent adjusting for inflation and he says:
Obviously the Manhattan data series, with fewer transactions, are much noisier than the national series. But broadly speaking, it costs you the same amount to buy a house today, in terms of your monthly mortgage payment, as it did at the end of 2004, when the median sales price was just over $600,000.
Here’s what I told him when admiring his chart handiwork:
We are def moving into a gray area where we are now seeing more and more Manhattan individual apts as cheaper to buy than rent in our appraisal practice – especially coops since they are cheaper than condos. Obviously the problem remains whether the buyer is credit worthy.
Since this analysis in aggregate there is not a “tipping” point where the line is crossed and everyone runs out and just starts buying apts (i.e. Justin Bieber tickets).
Last night the championship dreams for Knicks fans that began in earnest with Linsanity, was officially over, ending with a final loss to Miami in Miami. The Knicks resurgence has been one of the few feel good stories of the year. I will now shift my sports focus to the Yankees and, oh yes, Tebow. Seriously considering following Curling instead.
During the regular season, my sons and I began to collect “Clydisms” by Walt “Clyde” Frazier, our Knicks hero from the championship years. He uses sing-songy phrases to describe the action. Even his new restaurant name has the same style to it.
When one of us wasn’t able to watch a game, the others texted the rest of us new phrases hoping to discover a new one to add to our list.
Moving and grooving
Sliding and Gliding
Swishing and dishing
Rebounding and astounding
Running and stunning
He’s the Novack in novocaine
He’s the Guadeloupe with the hoop
Whacked and hacked
Cruisin’ and Bruisin’
Perculating and devastating
Fields with the steal
Hanging and banging
Duke and hoop
Dishing and swishing
Tantalizing and mesmerizing
Huffing and puffing
Penetrate and devastate
Posting and toasting
Hustling and muscling
Resounding rebounding
Dooming and glooming
Hounding and pounding
Hang and bang
Hanging and banging
Thriving and driving
Duping and hooping
Stops and pops
The Knicks with the knack
Eratic, dramatic, ecstatic and charismatic
Straining and paining
Slammin’ and jammin’
Winning and grinning
In the Knick of time
Slicing and dicing
Wishing they were swishing
Huff and stuff
Sharing and caring
Using and abusing
In the Knick of time
Hurrying and worrying
Hustling and bustling
Spinning and winning
Shakin’ and bakin’
Shake and bake
Stumbling and bumbling
Puffing and stuffing
Penetrating and creating
Agile and hostile
Elton got branded
Swoops to the hoop
Contagious and outrageous
Duping and hooping
A little more pep in their step
Amazing grace
Wheeling and dealing
Hustle with muscle
Transitioning and swishing
Stoppin’ and poppin’
Velcro “d”, stickin’ to the man
Plays with heart and smart
Hacking and whacking
Cruising and bruising
Fortitude and aptitude
Wheels and deals
Bounded and astounded
Posting and toasting
Stooping and hooping
Pulverized in the paint
Huffs and stuffs
Fire and desire
Spinning and winning
So nice we’ll show it twice
Showing his amazing grace
Tenacity and sagacity
Penetrating and creating
Hustling and bustling
Shaking and faking
Dancing and prancing
Prancing on the perimeter
Nasty and sassy
Synergy and energy
The attack, attacking the rack
Trying to keep from crying
Moving and grooving
Stumbling and bumbling
Not hesitating but devastating
Home Economics: How to rate a real estate agent Philadelphia Inquirer
Some veteran real estate agents in the Philadelphia region say they see little value in a new Web service that aims to rank them in order to help buyers and sellers choose the best ones. BILL SIKES / Associated Press What kind of real estate agent is ...
The home loans were issued by MortgageIT, a provider ... banking industry and deep that followed the crisis, there have been comparatively few prosecutions of wrongdoing connected to the and subsequent bust.
Speaking via satellite to a banking conference in Chicago, Bernanke highlighted ongoing problems in finance ... from the bursting of the and now also fear strains from the ongoing European crisis.
Leasinvest Real Estate SCA: Interim statement from the manager over the first ... Reuters
The first quarter of 2012 corresponds to the expectations for Leasinvest Real Estate. Taking into account the challenging market situation, the further commercialization of the lettings evolves favourably. Different investment files have been further ...
China money rates fall on expectation of ample supply Reuters
* Market players optimistic on future liquidity conditions * PBOC to use reverse repos more frequently - source * Market expects key money rate in 3.0-3.5 pct range By Chen Yixin and Pete Sweeney SHANGHAI, May 11 (Reuters) - China's money rates...
Britain’s biggest mortgage lender yesterday increased its rates by up to 0.3 percentage points despite the Bank of England keeping the base rate at 0.5 per cent for the 38th month in a row.
Another week, another record low for mortgage rates. Interest rates on fixed-rate mortgages edged down again this week, with both 30- and 15-year fixed-rate loans reaching new
A Chicago area real estate investor, the president of a Colorado real estate financing company, and a licensed appraiser were indicted for allegedly participating in a scheme to fraudulently attempt to obtain mortgage loans totaling more than $750,000 by selling three residential properties in Chicago to nominee buyers, federal law enforcement officials announced today. The charges result from Operation Madhouse, an undercover investigation in which a cooperating individual posed as someone who could assist in structuring fraudulent loan transactions through a bank contact who would approve bogus loan applications on behalf of nominee buyers.
Defendant Paul Demos, 66, of Chicago, the licensed appraiser, was arrested this morning and was released on his own recognizance after pleading not guilty at his arraignment before U.S. District Judge Amy St. Eve in Federal Court. Co-defendants Michael Fort, 42, of Hazel Crest, an investor who owned multiple properties in Chicago; and Jeffrey Olson, 43, of Lakewood, Colorado, who was president of 1st Funding Source LLC, which engaged in real estate financing, were not arrested and will be arraigned at a later date.
Fort was charged with three counts of bank fraud, and Demos and Olson were each charged with two counts of bank fraud in an indictment returned by a federal grand jury on Tuesday and unsealed today following Demos' arrest. The arrest and charges were announced by Patrick J. Fitzgerald, United States Attorney for the Northern District of Illinois; Robert D. Grant, Special Agent in Charge of the Chicago Office of the Federal Bureau of investigation; Barry McLaughlin, Special Agent in Charge of the U.S. Department of Housing and Urban Development Office of Inspector General in Chicago; and Alvin Patton, Special Agent in Charge of the Internal Revenue Service Criminal Investigation Division in Chicago.
According to the indictment, the fraud scheme involved a "double-closing" on a residence located at 5517 South Paulina St. and the sale of residences located at 6845 South Morgan St. and 1241 North Monitor Ave., all in Chicago, between June and September 2010. The defendants and others allegedly fraudulently attempted to obtain loans by preparing and submitting to an unnamed bank applications in the names of nominee buyers that contained false information about the borrower's employment, income, assets, down payment, intention to occupy the residence, and the value of the property.
Regarding the Paulina "double-closing," the defendants and the undercover cooperating individual allegedly agreed that Fort would "short sell" the residence to a nominee intermediate party, who would immediately resell the property to a nominee buyer, with the second sale financed by a fraudulently-obtained $295,850 loan. Fort allegedly hid information from the short sale lender, including that Fort had arranged for an immediate resale to a nominee buyer at a price significantly higher than the short sale price and based on an inflated appraisal and that he would profit from the resale.
The Morgan Street property was to be sold to a nominee buyer financed by a fraudulently-obtained $300,600 loanand the Monitor Avenue sale by Fort to a nominee buyer financed by a fraudulently-obtained $203,700 loan, the indictment alleges. As part of the scheme, Fort would pay a fee to the nominee buyers of the Paulina and Monitor properties, it adds. In exchange, the nominee buyers would obtain the loans and sign the documents at closings but would not occupy the residences or make payments on the loans. Fort allegedly intended to keep the proceeds of the fraudulently-obtained mortgages.
Demos allegedly provided the bank with false appraisals that inflated the value of the Paulina and Morgan properties. Olson allegedly provided the down payment funds for the nominee buyer of the Morgan property, and agreed to provide the down payment and short sale funds for the Paulina property. In September 2010, Fort and others appeared at the closings for the sale of Paulina and Morgan properties, allegedly intending to receive approximately $596,450 in fraudulently-obtained loan proceeds. Together with the Monitor property, the defendants allegedly intended to fraudulently obtain mortgages totaling more than $750,000.
The government is being represented by Assistant U.S. Attorneys Tyler Murray and Christopher Stetler.
Each count of bank fraud carries a maximum penalty of 30 years in prison and a $1 million fine, and restitution is mandatory. If convicted, the court may impose an alternate fine totaling twice the loss to any victim or twice the gain to the defendant, whichever is greater. The court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The charges are part of a continuing effort to investigate and prosecute mortgage fraud in northern Illinois and nationwide under the umbrella of the interagency Financial Fraud Enforcement Task Force, which was established to lead an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes.
Since 2008, approximately 200 defendants have been charged in Federal Court in Chicago and Rockford with engaging in various mortgage fraud schemes involving more than 1,000 properties and more than $280 million in potential losses, signifying the high priority that federal law enforcement officials give mortgage fraud in an effort to deter others from engaging in crimes relating to residential and commercial real estate.
The Financial Fraud Enforcement Task Force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch and, with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit: www.StopFraud.gov.
PARIS—As part of this year's Momenta art show, Paris' famed Grand Palais building is now blanketed in colored parasols that one can walk beneath, thanks to the vision of artist Daniel Buren. Architizer has an apt description for “Excentrique(s)," as the exhibition is called: "The day after disco."
THE INTERNET—Textiles/furnishings/home accessories brand DwellStudio has teamed with Hatch maternity wear line and supermodel Christy Turlington on a Mother's Day-themed Pinterest contest. Create a Pinboard named #STYLESQUARED, Pin images "that showcase your personal nursery and fashion style," and email the finished board to blog@dwellstudio.com for a chance to win $1,500 in DwellStudio and Hatch items. (For every Pinboard created, the brands wil donate $10 to the nonprofit Every Mother Counts.) Contest runs through May 17; more info over here. [CurbedWire Inbox]
EVERYWHERE—Fannie Mae's Q1 reports are relatively sunny: the mortgage giant posted a $2.7B profit and, for the first time since Sept. 2008, didn't require any cash infusion from the Treasury. During the same period last year, Fannie Mae posted a $6.5B loss. [WSJ]
Mortgage rates hit a new record low yet again this week. According to Freddie Mac, the average on a 30-year fixed rate mortgage is now just 3.83%. That's way below the average 30-year fixed
Another week and another record low for mortgage rates. The average rate for a 30-year fixed loan fell to 3.83 percent in the week ended today, Freddie Mac said in a statement. The average 15-year rate fell to 3.05 percent, another record low, from 3.07 percent. These...
Brazil's Bank CEF Reduces Interest Rates On Loans Again Fox Business
SAO PAULO – Brazil's government-controlled bank Caixa Economica Federal, or CEF, on Thursday disclosed a new reduction of interest rates, amid government efforts to reduce rates of consumer and business loans. The interest-rate cut is the third ...
Movoto has just released an infographic charting out what the White House would cost if it were located in various American markets. Considering the median price per square foot in each metro area, the real estate trend tracker estimates that the 55,000-square-foot mansion would list for $110M to $115M if it were put on the market in D.C., $20M in Houston, and, of course, far more in expensive cities such as NYC, Los Angeles, and San Francisco. Play around with the interactive infographic below.
I'm Greg McBride with Bankrate.com and here is your weekly look at mortgage rates. Mortgage rates were down for a fifth consecutive week, and in the process, set the third new record in a row.
WASHINGTON (AP) - Average U.S. rates for 30-year and 15-year fixed mortgages fell to fresh record lows this week. Cheap mortgage rates have made home-buying and refinancing more affordable than ever for those who can qualify.
Rates on fixed-rate mortgages hit record lows this week, with the 30-year fixed-rate mortgage averaging 3.83% in Freddie Mac’s most recent survey of conforming mortgage rates, released on Thursday.
Twelve people have been charged in an alleged mortgage fraud scheme: Ronald Burrell, Crystal Kelly, Nicole Bakker, Jer'me Franklin, Hoover White, James Myers, Raymond Litvin, Duran Brown, Marc Wilson, Montresse Parham, Vernon DuBose, and Wesley Walker III.
MCLEAN, Va., May 10, 2012 /PRNewswire/ -- Freddie Mac (FMCC.OB) today released the results of its Primary Mortgage Market Survey ® (PMMS ® ), showing average fixed mortgage rates hitting new all-time ...
Rickey White, 46, Westland, Michigan, and his company, Braunstein & Associates, face criminal charges for an extensive foreclosure-rescue fraud operation that scammed at least 360 victims out of $800,000.
NEW YORK, May 10, 2012 /PRNewswire/ -- Mortgage rates fell for a fifth consecutive week, with the average rate on the benchmark 30-year fixed mortgage rate dropping to 4.02 percent, according to Bankrate.com's ...
Serbia Holds Interest Rates Before New Cabinet Is Formed Bloomberg
Serbia's central bank left its benchmark interest rate unchanged for a fourth month as rate- setters wait for a new government to be formed after May 6 elections. The Belgrade-based Narodna Banka Srbije kept its two-week repurchase rate at 9.5 percent, ...
Jared Mitchell Rothenberger, 43, Minneapolis, Minnesota, was indicted and charged with allegedly defrauding mortgage lenders out of millions of dollars in connection with the sale of condominiums at Chateau Ridge, Burnsville, Minnesota.
Nothing excites Australians like house prices and mortgage rates . It is no surprise, therefore, that the recent decision by major banks to increase interest rates independently of the Reserve Bank of Australia (RBA) - has led to hyperventilation among consumers and politicians.
You have a stack of bills in front of you and you may not be able to pay them all. Which debts are the most important?
Many people make the mistake of paying their credit cards before their other debts. I argue that credit cards fall very low on the list of debt priorities, especially if you have a mortgage and auto loan. Learn why your mortgage should top your list of debt obligations: How to Prioritize Your Debt Payments
If you’re going to make your debut on a widely-read website, what better way to do so than with a bold prediction … I boldly predict that inventory here in the Phoenix real estate market will not decline by more than another 7,900 homes over the next millennium.
Oh, for those halcyon days of yore. For now, as we slowly creep toward the second half of 2012, there are fewer than 7,900 detached homes for sale in Maricopa County, an area (as both readers of my own blog know by heart) roughly the size of New Jersey. Or even Macedonia, for our more worldly readers.
Granted, large portions of Maricopa County are inhabited only by ground squirrels and cacti, but the general idea still holds – there’s just not a whole lot available right now.
And that leads to the current great debate in real estate, or at least one of them – the existence of shadow inventory and the coming next wave of foreclosures.
If you’ve heard anything at all about real estate or the economy over the past while, you’ve likely heard that there’s a mass of shadow inventory – homes that have been foreclosed upon and never put back on the market, or homes that should have been foreclosed upon but weren’t – looming in the wings, ready to swamp the real estate markets and crush the burgeoning appreciation we are seeing.
What you may not know is there has been a predicted second wave of foreclosures for more than four years running, ever since inventory dove and sales started to pick up in March 2008. And yet, this wave never has reached the market, not after four years of solid doomsaying. The numbers also suggest the wave may not be what some believe it to be.
There are factors that have led us to where we are, with less than 1,000 bank owned homes on the market, most significant the so-called robosigning scandal where banks were foreclosing on homes that they shouldn’t have (in theory) that then caused said banks to stop foreclosure proceedings.
With robosigning firmly in the rear-view mirror, there should be an increase in foreclosures and thus an increase inventory.
That covers the supply side of things.
From a demand perspective, it’s damned hard to get an offer accepted on a home priced under $100,000 these days. Most buyers are discovering they are but one of a dozen or more potential suitors for these rare finds, which means all but one of the dozen or more walk away without a home.
Even with negligible inventory, sales in the Phoenix market are about what they were a year ago when there were nearly three times as many homes for sale.
All of which is a long way of saying that there’s sufficient demand in the Phoenix market to handle an increase in inventory – a significant increase, even, up to an additional 10,000 homes – without much of a blink. (With the assumption the homes hit the market pre-Labor Day versus post-Labor Day, when they would languish a little bit longer.)
For now it’s just a matter of waiting to see if and when these other homes get added to the inventory. And, in the interim, we can watch the shrinking inventory secure in the knowledge that there’s a definite hard floor to the number of homes available … zero.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
The average rate for a 30 year fixed rate mortgage declined 1 basis point to 3.91 percent since last week while the purchase application volume increased 3.4 percent and the refinance application increased 1.3 percent over the same period.
Cresa, North America’s largest firm exclusively representing tenants, announced today that it has formed a strategic partnership with SRS Real Estate Partners . This arrangeme
WASHINGTON, May 9 (UPI) -- The Mortgage Bankers Association said U.S. mortgage activity rose marginally in the week ended Friday with interest rates inching lower.
Northwest Healthcare Properties Real Estate Investment Trust Releases First ... Sacramento Bee
The property was acquired for $7.0 million free and clear of mortgages, with the REIT subsequently securing 10-year mortgage financing for $4.6 million at a fixed interest rate of 4.23%. Centre Medicale de L'Hetriere is a newer development and is the ...
As one of the co-founders of Pixar, the wildly successful film studio, Ed Catmull is one of the legends of animation, but he also has a creative mind when it comes to real estate. He currently heads both Walt Disney Animation Studios and Pixar Animation Studios, but found time to work with architect Steve Wisenbaker to design this custom Georgian Colonial, completed in 2000, in the Marin County town of Kentfield. Apparently Catmull is ready to move on, because he listed the gated estate for $10.9M back in late April. The price includes six bedrooms and ten total bathrooms spread over 8,800 square feet, plus a guest house. Inside, the design is casual, but incorporates technology and some stunningly-expensive touches, like a Charvet Caumartin range in the kitchen. The landscaped grounds include a swimming pool and seven-car auto court, plus two underground parking spaces. A unique touch comes from the artwork "Tiles of the Hyperbolic Plane" by mathematician Helaman Ferguson, currently installed on the patio.e
· Pixar President Selling His Kentfield Estate [Curbed SF]
SAN ANTONIO, May 9, 2012 /PRNewswire/ -- Dan Diepenhorst, president and chief executive officer of Legacy Mutual Mortgage (operating name of Gardner Financial Services, LTD.), has announced that the company ...
Allen Weiss, 60, Marlbor, New Jersey, and David Moulakis, 55, Toms River, New Jersey, two real estate developers, were sentenced for their roles in an investment fraud conspiracy that embezzled nearly $1 million in connection with purported commercial real estate developments.
Of course the report is pointing out what has been an obvious problem for at least the past decade. Banks have transitioned into the view that an appraisal report is a commodity and not a professional consultation. The irony here is the same thinking applies across both commercial and residential valuation assignments for banks but with polar opposite results.
Commercial valuations are seen as “too high” and residential valuations are seen as “too low.” This probably has a lot to do with the fact that commercial real estate, especially class a office space in markets like NYC, Washington DC and San Francisco is probably in the middle of a bubble and there is clearly indirect pressure on the appraiser to make the deal work (no matter what is being said publicly).
Of course residential valuations were way too high during the housing boom so a similarity can be drawn during that period as lenders relied on mortgage brokers to deliver the majority (2/3) of loan volume by the time the market peaked.
The common thread in all this is to understand how the appraiser is engaged by the bank. In residential valuation it has morphed over to the appraisal management company process (B of A’s Landsafe is the poster child for bad appraisals) and in commercial valuation it has become a robotic automated engagement process:
John Cicero, a managing principal of the appraisal firm Miller Cicero, said: “It is a broken profession in a lot of ways. The appraisal industry has become commoditized, where lenders see appraisals as simply a commodity to be purchased by a vendor and where more emphasis is placed on the price of an appraisal than the expertise of the appraiser.”
For example, Mr. Cicero said, in the past lenders would often have long discussions about the project and the appraiser’s qualifications before hiring. Now, it is more common for lenders to use an online bidding system, where they issue a request for proposals from appraisers and often choose the least expensive. “They actually refer to us as vendors submitting a bid, not educated professionals who are providing an important service,” he said.
After a while (and it’s been a while) this becomes a self-fulfilling prophecy and the majority of appraisers used by banks are simply bad at their craft (taking liberties here) because the system attracts that “type” appraiser. As a result many of the good appraisers have either left the business or switched their client base to those who see valuations as more than the equivalent of a “title search.”
Banking’s shortsightedness illustrated
When a bank is considering lending $200M on a commercial office building, they are usually are more concerned about shaving $500 off the appraisal fee than they are contracting with a seasoned local market expert. Lowballers with fast turn times are thriving and their product is very weak. The same goes for a residential mortgage only with commercial lending, the stakes are much higher because the exposure is so much greater – then ask yourself, who is the party that lacks competency? I’d say it’s systemic.
“It’s tangible, it’s solid, it’s beautiful. It’s artistic, from my standpoint, and I just love real estate.” – Donald Trump
The Donald hasn't made a down payment on property on St. John - yet. But other people have, encouraged in no small part by significant price reductions.
So far this year, four home sales have closed and a dozen are pending. Annualized, the sales pace is 20% ahead of last year when 27 properties were sold.
Add to the heightened interest, the Wall Street Journal reporting "The bidding wars are back."
Gretchen Labrenz at Cruz Bay Realty reported a number of showings in the past week for the Inquiring Iguana' affordable and money-making Blue Tang.
The number of homes for sale is lower than a few months ago, so Islandia's Jane Kelly is cold calling homeowners inquiring whether they'd like to list their property. "I am working with cash customers that aren’t finding the home of their dreams at the present time," she said.
The bonds of Caisse Centrale du Credit Immobilier de France, the residential mortgage lender, slumped in the over-the-counter market after the securities were suspended at Euronext Paris and the Luxembourg Stock Exchange.
But … the author seems to have had a bad experience with a real estate agent that must have precipitated his rant. (try as I might, I cannot find the author’s name on the post, otherwise, I’d ask)
I almost stopped reading when I read that one of his sources for proof was Glengarry Glen Ross. But where’s the fun in not reading a rant?
I’ll be the first to tell you that there are too many unqualified real estate agents practicing real estate. I’ll also be the first to argue that those professional agents who truly represent their clients’ best interests are often underpaid.
Stepping through some of the author’s arguments:
“Agents routinely tell buyers not to worry about the fat commission because “the seller pays it.””
No. A lot of agents might, but I have no idea; my role is to represent my clients, not know what other agents say to their customers and clients. But … I think assuming the consumer is stupid is the wrong approach. Buyers (and sellers) know that nothing is free.
“In most areas a few big brokers handle most transactions.” Partly true.
From 1 January 2011 to 1 May 2012 in the Charlottesville MSA + Louisa:
- There were 3051 closed transaction in the Charlottesville MLS.
- The top 10 firms accounted for nearly 70% of the sides; a “side” being either the “buyer representation” or “seller representation” side of the transaction
- About 120 firms accounted for the remaining 30% of sides. That sounds like competition to me. (*of course, ~60 of those firms did between .5 and 5 sides)
“Buyers’ agents have an incentive only to show their clients homes whose sellers offer them a standard 3% commission.”
Partly true. This is one of the reasons I negotiate my fee with my buyer clients first; I don’t want my fee to be determined by the opposing party – it’s not right and leads to suspicions of collusion.
“To solve this problem, many sellers’ agents offer to cut their own fee while still offering the full price to the buyer’s agent. Alas, word soon spreads that they are giving rebates. That makes many buyers’ agents steer their clients elsewhere …”
This is one of the most absurd statements I have read; why do I care what a seller is paying their representative? I’d like to see documented facts for this rather than a speculative stab in the dark.
Some reasons the internet is not going to marginalize all segments of the real estate profession:
- Until the compensation landscape changes to where consumers are willing to pay their agents out of pocket, nothing will change.
- Not all questions have google-able answers.
- Buying a house is still complex and trying; a lot of buyers and sellers need guidance and advice. I’d say that for most of my clients, the guidance, advice and service wavers between valuable and invaluable.
- The MLS is owned and operated by Realtors; it’s neither a public service or nor right to have access to it. – Every state and locality has a different real estate market, environment, customs and practices – experts matter. Example for those in the Charlottesville area: Do you know what a 3/4 bathroom is? Other markets seem to have them; we don’t. Know what a FROG is? (hint: finished room over a garage, aka: “bonus room.”
- Most consumers buy or sell real estate every 5-10 years; the market changes seemingly every month. If you’re not doing this (real estate) every single day, you’re not going to have the necessary expertise to represent your client or yourself adequately
CHICAGO, IL-- - The national mortgage delinquency rate declined for the first 3 months of 2012, coming in at 5.78%. This improvement ends 2 quarters of increases that began in Q3 2011. This information ...
Shawn Anthony Swor, 43, Missoula, Montana, pled guilty to investment fraud at during a federal court session in Missoula, on May 1, 2012, before U.S. District Judge Donald W. Molloy.
Delinquent real estate taxes impacting Chambersburg Borough's general fund health Chambersburg Public Opinion
By SAMANTHA COSSICK CHAMBERSBURG -- More than $200000 in delinquent real estate taxes for 2011 were turned over for "tax claims" in January 2012. The number of unpaid real estate taxes owed to the borough has increased each year from $83918.95 in 2007 ...
Chambersburg Area school board may increase real estate tax rate tonight Chambersburg Public Opinion
By BRIAN HALL Chambersburg Area school board is expected to vote on a 2 percent real estate tax increase at tonight's workshop meeting. Voting on the tentative 2012-13 general fund budget and associated tax rates will be the only action items of the ...
Real estate bust sank GOP fundraising Politico
As home prices have plummeted in areas hit hardest by the real estate bust, so have political contributions from rich Republican donors, a POLITICO analysis of campaign finance data shows. Four years after a presidential race that flooded American ...
Always fun to speak with Deirdre Bolton on her show. The producers positioned us to speak on the main floor in the middle of a lot of activity – talked luxury housing market.
Even with health insurance, you can end up with medical bills from services your policy didn't cover. If you end up with overwhelming medical debt, don't ignore it. Pretending the debt doesn't exist can make the situation worse. Instead, take steps to deal with medical debt so you don't end up in bankruptcy.
Brazil's Barbosa: Lower Interest Rates Spurring Credit Growth Wall Street Journal
BRASILIA (Dow Jones)--The pace of lending in Brazil is accelerating as interest rates and bank spreads are declining, Deputy Finance Minister Nelson Barbosa said Tuesday. The benchmark interest rate in Brazil has fallen from 12.5% in August to 9%, ...
If lawmakers can't come to an agreement, the federal Stafford loan interest rate will jump from 3.4 to 6.8 percent on July 1, adding an average of $1,000 to the cost of a year of college. Students from across the country visited Capitol Hill on Tuesday to ask Congress to keep that from happening.
Students To Congress: Don't Let Interest Rate Double NPR
Sherrod Brown and Jack Reed (right), addresses upcoming changes in federal Stafford loan interest rates at a Capitol Hill news conference Tuesday. Howard University political science major Clarise McCants, flanked by Democratic Sens.
If you’re a real estate blogger, you have undoubtedly heard the experts sing the praises of hyper-local blog posts. And you may be a great hyper-local blogger yourself. But, I saw a post recently on (what a surprise!) Active Rain that...
***Visit the BRER Real Estate Marketing Blog to get the rest of the story!***
Billy Joel, everyone's favorite piano-playing man, has put his enormous Miami Beach mansion on the market for $14.75M. He bought the 8,880-square-foot Mediterranean-style home, set on a .67-acre slice of waterfront on the luxe, celeb-studded island of La Gorce, for $13.5M in 2006. Despite Joel's notorious penchant for marrying a lot, this place has only seen one of his wives: the young Katie Lee, whom the singer married in 2004 and divorced in 2009.
Some details about the house: it has seven bedrooms and 8.5 baths, beige-yet-fancy-looking furniture and decor, and some rather stunning features outside, including loggias, palm trees, paver stones, a pool and spas, boxwood hedges, a cabana, an outdoor kitchen, a deepwater dock, and more than 150 feet of direct frontage on Biscayne Bay. Overall the look is way more stuffy and done-up than Joel's much cooler, edgier place in Manhattan, not to mention his other waterfront house—an airy, Sagaponack, N.Y., estate that was decorated by celebrity interiors guy Nate Berkus and lingered on the market sans buyer until it was finally de-listed. Here's hoping that grand piano, tucked into the corner of the living room, added some levity and light to the space.
Appointment of Van Davis as President, Brokerage Operations reflects commitment to building on ZipRealty`s top 15 position in the residential real estate industry EMERYVILLE, Calif. - May 8, 2012 - ZipRealty, ...
By Melissa Mott May 8 - If the mortgage unit of loan giant Ally Financial files for bankruptcy this weekend as expected, there will be one immediate reason -- the company could default on $1bn of debt ...
While some of the experts are saying that the Penguin update is affecting about 3% of searches done in English, there are still a lot of people who seemed to be negatively impacted. And, for many of those, they just don’t know what hit...
***Visit the BRER Real Estate Marketing Blog to get the rest of the story!***
Orlando, Fla., is one odd duck, having hosted the likes of Joey Fatone estate sales and Martha Stewart's homebuilding efforts in the past. Now the city most associated with Disney has also been crowned the smuttiest place in the country, thanks to a recent Men's Health survey that took into account a variety of factors, from "the number of DVDs purchased, rented, or streamed" to the number of adult entertainment stores.
With an ask of $4.6M, this behemoth, perched on the front nine of the Lake Nona Golf & Country Club, is one of the most expensive properties in town, and its prim, proper, colonnaded exterior belies quite immodest interior decor. The 9,300-square-foot home is filled with overstuffed armchairs, lavish passementerie, intricate prints, and oriental rugs in nearly every room, not to mention a bar/lounge complete with a neon-lit home aquarium and a sultry, steamy red guest room with damask ceilings—damask ceilings! Do peruse the gallery above.
Patricia Smith, 57, and Jamilah Smith, 31, Irvington, N.J., A mother and daughter from New Jersey each were sentenced to 24 months in prison for participating in a scheme involving New Jersey properties that caused mortgage lenders to release more than $1.9 million in loans obtained by fraud.
OTTAWA (Reuters) - The Canada Mortgage and Housing Corp's (CMHC) prediction that central bank interest rates will stay on hold this year is based on external forecasters and not any special guidance from the Bank of Canada, the agency said on Tuesday. In its annual report, CMHC said that the Bank of Canada has indicated it is likely to keep its key interest rate at 1.0 percent for 2012 ...
OK, “crafted” is a real stretch. But it was published on May 8, 2005.
That seems like a lifetime ago.
Since that day some 2,000ish articles have been published here, some of far better quality than post #1, many not. Over 30,000 comments have been left by some four million visitors.
That last number is what blows my mind. I never would have dreamed that many people would stumble across our little corner of the interwebs.
Though I would still write if no one visited, there are few things I cherish more than those that take the time to stop by, read, search for homes, and comment if they feel so inclined. I sincerely appreciate each and every one of you.
I know things have been a bit slow here the last couple of months. Getting a new job, relocating, and having a heart attack all in the span of six weeks has taken up a lot of time formerly devoted to writing. Hopefully things will slow down a bit from here. Phoenix Real Estate Guy is not going away.
In fact, soon you will see some new talent here alongside me. Some Thompson’s Realty agents will be posting, and I should be able to kick in content as well.
I would be remiss if I didn’t specifically thank three people that have done more to help me keep this thing alive than they realize. My lovely wife Francy and two stunning “children” James and Lauren – who were 11 and 13 when TPREG was born and are now adults — have supported me, encouraged me, and been as mystified as I have by the success of the blog. They are everything I live for. Thank you all.
It should be interesting to see what the next seven years bring!
Photo credit: Yours truly. I have no idea how I managed to find a bottle of Jack Daniel’s lying around…
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
The mortgage giants sign on to Keep Your Home California, a $2-billion foreclosure prevention program, after state drops a requirement that lenders match taxpayer funds used for principal reductions. As California pushes to get more homeowners into a $2-billion foreclosure prevention program, some Fannie Mae and Freddie Mac borrowers may see their mortgages shrunk through principal reduction.
Both the expectation for home prices and the percentage of those who think the U.S. economy is on the right path reached record highs in Fannie Mae’s April 2012 National Housing Survey.
Americans continue to expect home prices to go up, with the projection averaging 1.3 percent over the next 12 months, the highest value recorded.
At 71 percent, a high percentage of Americans still say it is a good time to buy while the percentage who said it is a good time to sell was 15 percent, a 1 point increase from March.
“Overall, consumer views of housing market conditions have become more supportive of home purchases, and sustained healthy hiring is required to help realize these improved expectations,” said Doug Duncan, Fannie Mae chief economist.
Duncan also mentioned the recent figures on employment in April, which showed a decline in job growth.“Friday’s report of a second consecutive setback in job creation supports the view that the housing recovery will remain uneven this year,” said Duncan.
The expectation for average rental prices decreased slightly to 3.6 percent; in March, respondents expected rent to go up by 4.1 percent over the next 12 months.
If respondents were to move, 32 percent said say they would rent while 64 percent said they would buy. The percentage of those who said they would rent increased 2 points and reached the highest level since November 2011.
The percentage of Americans who believe the economy is on the right track rose to 37 percent, a 2 point increase from the previous month and the highest level in the survey’s two-year history. Still, an even greater 56 percent believe the economy is moving in the wrong direction.
Also, 23 percent of Americans reported their household income is significantly higher than it was a year ago, while 36 percent said their household expenses are significantly higher since the same time period. Both categories rose 2 percentage points compared to March.
The percentage of those who think their financial situation will decline was unchanged from the previous two months at 12 percent, the lowest value recorded in over a year.
The Fannie Mae survey polled a nationally representative sample of 1,000 respondents aged 18 and older between April 4, 2011 and April 27, 2012.
Google’s Penguin update was launched on April 24, 2012. If you’ve seen a change in your search engine rankings, you need to understand the new update. And, if nothing happened to your rankings, you still need to keep up with...
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DocuSign, the global standard for eSignature, today announced Midwest Real Estate Data , the Chicagoland multiple listing service, has integrated its industry-leading platfor
Mary Anne Dean, 60, Severna Park, Maryland, was sentenced to 37 months in prison in connection with a mortgage fraud scheme which resulted in over $4.7 million in fraudulent mortgage loans, of which the lenders ultimately lost at least $944,223.91, and which caused the homeowners to lose over $1.2 million in equity in their homes.
(Crain's) — Chicago's landmarks ordinance got a boost Wednesday when a Cook County judge dismissed claims that the law is unconstitutionally vague.
In a 27-page ruling, Judge Sophia Hall sided with the city, frustrating a six-year campaign by landmarking opponents to nullify two landmark districts on the city's North Side.
But the legal battle over the landmarks law, which allows the city to designate properties and areas as historically significant enough to prevent their demolition, isn't over yet. Thomas Ramsdell, the attorney for the plaintiffs, real estate executive Albert Hanna and broker Carol M. Mrowka, is vowing an appeal.
"We're disappointed in her ruling. The most I can say is we strongly disagree with her reading and interpretation of the binding Illinois appellate court decision of 2009," says Mr. Ramsdell, a partner in the Chicago office of Royal Oak, Mich.-based Howard & Howard PLLC.
A spokesman for the Department of Law says in an email that the city is pleased with the ruling. The city is the primary defendant in the case.
Appomattox supervisors vote to increase real estate tax Lynchburg News and Advance
In a split decision Monday night, Appomattox County supervisors voted to add eight cents to the real estate tax rate. Supervisors Gary Tanner, William Craft and Samuel Carter voted for the increase, with Ronnie Spiggle and Jerry Small voting against.
The 'folly' of the US housing bubble Washington Post
No folly has hurt the United States more than the housing bubble of this century's first decade. “All of us participated in the destructive behavior — government, lenders, borrowers, the media, rating agencies, you name it,” Buffett wrote in his ...
Fitch Rates San Antonio City Public Service's (TX) Electric & Gas System Revs ... MarketWatch (press release)
Both electric and gas rates have automatic adjustment mechanisms to recover fuel costs. DIVERSE, LONG GENERATION PORTFOLIO: CPS enjoys a competitively priced and sufficient generation portfolio, resulting in competitive rates and rate flexibility.
How to squeeze out higher interest rates from your savings USA TODAY
By Sandra Block, USA TODAY When the Federal Reserve pushed interest rates higher in the late 1970s to bring down inflation, angry farmers drove their tractors to Washington, DC, and blockaded the Fed's headquarters. By Sandra Block The Fed's current ...
Ever get tired of endlessly riding in cars with buyers? Do you ever just feel like you need to be working smarter instead of working harder? Well maybe you can be. Partner with me and let’s open a FavoriteAgent.com relocation office together. Really. If we do it together, we can both add value and provide what the other can’t, and best of all, we can make a lot of money.
But before we get into all that, let’s think about what a relocation company is at its very core. It is a company that attracts people who are relocating, engages those clients, and then places them with real estate professionals. Finally, a relocation company oversees the process to ensure the client is happy and that the agents pay them the agreed upon referral fee.
The largest relocation company today is Cartus Mobility (originally part of what is now Realogy, the parent company of Century 21, ERA, Coldwell Banker, Sotheby’s International, and Better Homes & Garden real estate brands). In all likelihood, the company in your market who handles their relocation is the busiest company in your market. Sounds good, right? It gets better.
The agents who work those relocation clients are accustomed to paying as much as 40% of the gross commission for each side of a transaction, and since it is a relocation, over half the time there are two agents for one client — one helping them buy and another helping them sell their existing home. But even if there are not two transactions, there is always one.
Now, imagine if you could identify those relocation clients early in the buying cycle, engage them, and then refer those clients to an agent you’ve pre-screened on the client’s behalf. You could make 40% of the gross commission on each end as a referral, and you could run the entire operation from the comfort of your home. Simple right?
All you would need is a system to attract relocation clients, and then client management that allowed you to oversee the progress your referral agents were making on your relocation business. That’s where we come in. We’ll supply the clients but we need you to oversee the relocation operation in your local market. To be our eyes on the ground, so to speak. Let me walk you through an example:
Using our proprietary system, we would place online advertising in your market and attract a new relocation client and seamlessly forward that lead to your client manager. For purposes of this example, let’s say the client has a $200,000 home to sell where they currently reside, and they need to buy a similar but more expensive home in your market, let’s say $250,000.
First, you refer the listing to an agent you’ve pre-interviewed and collect a referral fee of 40% of a $6,000 gross commission from the listing side. That’s an easy $2,400, and believe me, the listing agent is thrilled to get the easy listing and will be happy to pay your referral fee.
Then on the buyer side, there’s a 3% commission on the new purchase price of $250,000 (assuming no bonuses or higher commission offered by builders or agents). That is another 40% of $7,500 gross commission, or $3,000 for the buyer side. Not bad.
Now think about it: You’ve not burned a dime of gas. You’ve not wasted a week of your life riding around town showing houses. You’ve not wasted your weekends holding open houses or canvassing neighborhoods. You’ve not had to place advertising, yard signs, lock boxes, or any of the other hassles of doing traditional real estate business.
Together we have provided the valuable service of identifying, engaging, and referring our client, and we’ve made $5,400 in referral fees. And because we are partners, we would split that fee — $2,700 for you and $2,700 for us. Neither of us has any legal requirement for record keeping, because we are not the agent or the broker, but rather simply collecting a referral fee. We also have no transactional liability and pay no franchise fees. Okay, so what’s the catch?
Here it is: If we decided to partner with you to open a FavoriteAgent.com relocation office in your market, we would have several requirements of you. First we would require that you attend regular training and accountability conference calls. Because we will be making a big investment in your market, we also require a very specific sequence of customer engagement action steps.
Remember, there are several steps in this process: Identify, engage, refer, and service. We would handle identifying the clients. You would then engage them and refer them to your relocation team, who would provide the brokerage service to the client.
You would be required to recruit a minimum of two agents for your relocation team and get them to sign a blanket referral agreement with our company. Of course, depending on your transaction volume, you may recruit as many referral agents as you deem necessary to handle your volume of business.
We also require a one-year commitment, renewable by both parties every year. And we would require you to continue to license our LCM Success virtual office software so that you will have the client management platform needed to interface with your own relocation team and with our system.
As we advertise and grow in your market, we will periodically evaluate the relocation customer count and may adjust the number of relocation partners so as to maximize our volume of business. (If you would like to discuss entering an exclusive agreement, please contact us and we will be happy to discuss it with you.)
Imagine… What if instead of going into the office to begin the traditional real estate grind, you tried something brand new? You decide to take the thirty-second commute to your home office. You check your email and there are two brand new relocation leads that have come in overnight. You sit back in your chair, sip your coffee and begin to plan your day.
You pull together some stats for your relocation team training and accountability call in half an hour. Then you open your client manager and look through the 18 relocation leads that have come in over the last month. Of those, there are only 7 people you need to touch base with today and then you are done. After that, you need to call your three referral agents and check in to make sure no balls are being dropped. How easy is that?!
You should be able to make it to an early lunch at the club and then take the afternoon shopping for a new convertible. Hmmm. Tennis anyone? Catch that afternoon matinee? Actually you can do whatever you want. No sales meetings. No caravan. No time wasted by other agents in the office. No everyday real estate grind.
Your new job is the very picture of simplicity. All you have to do is engage your relocation buyers and hand them to waiting referral agents. No endless showing appointments. No dinner time listing appointments. No dread of constantly having to drum up the next deal. Oh, and let’s not forget — no weekends. No nights. No gruelling hours. No marathon closings. Just making friends and placing them with great agents. How cool is that?!
So let me ask you a question. What if we were to close only two transactions per month together? You’d pocket an extra $5,400* with no expenses and no liability. What if we closed four? Or ten? Do the math. How many agents can you recruit and how much business can they do? That could be a lot of money with virtually no risk.
Does this sound like something you would enjoy? Are you willing to learn some very specific engagement strategies? Are you willing to do it our way and not try to reinvent the wheel? Are you able to recruit at least two agents who can handle referral business professionally? It doesn’t even matter what company they are with as long as they are licensed and they are good with our customers. Are you prepared to make a one-year commitment? If so, contact us and let’s talk.
Maybe a relocation partnership makes sense. Or maybe it doesn’t. It can’t hurt to talk and once we find our partner agent for your market it could be too late for you. Thank you for taking the time to consider this proposal. I look forward to talking soon.
*Projection based on the sample transaction in the example above. Your market may vary.
I Hate Technology!
Do you ever get the idea that an entire cottage industry exists for the sole purpose of fleecing agents out of their hard-earned commission dollars? Ever feel like a new technology company springs up every 15 minutes with the latest, greatest new clever idea? And all the pitches are the same: a room full of drones on phones, calling agents from the NAR membership list, promising great success! Read more >>
Matt Jones is the founder and CEO of FavoriteAgent.com, nationally syndicated columnist, broker, and best selling author of LCM: The Secret to Success in the New Age of Real Estate, The Ultimate Listing Presentation, Traffic: How to Sell Fast and Net More, Becoming a Mega-Producer, The Science of Online Marketing, 10 Steps to Real Estate Success, 20 Questions: Everything You Always Wanted to Know about Real Estate but Were Afraid to Ask, The Virtual Office Model, Max-Bang!, and The NEW Ultimate Listing Presentation. Jones’ North Carolina-based company has been profiled by major media outlets as an innovator and a pioneer in the industry, and CNN’s Pulse on America claimed FavoriteAgent.com is “changing the way real estate is being done in America.” This article is cross-posted in the following locations: BlogMattBlog.com, RealBlogging.com, NewsGeni.us, TheCommissionCheck.com, RevampedAgent.com, and now Amazon Kindle.
WILMINGTON, Del. - The judge in Washington Mutual's bankruptcy case ruled Monday that a group of investors who are plaintiffs in a federal mortgage-backed securities lawsuit against WaMu cannot file a claim in the company's bankruptcy case until distributions are made to a group of low-ranking creditors.
The judge in Washington Mutual's bankruptcy case ruled Monday that a group of investors who are plaintiffs in a federal mortgage-backed securities lawsuit against WaMu cannot file a claim in the company's ...
The nation's largest shopping mall operator, Simon Property Group Inc., is now also the world's largest real estate company.Indianapolis-based Simon Property this month is listed at No. 1 on the FTSE EPRA/NAREIT ...
Seven defendants, including a man who co-owned a Chicago, Illinois, condominium building, a police officer and two loan officers, were indicted for allegedly participating in a scheme to fraudulently obtain approximately 35 mortgage loans totaling more than $8.8 million from various lenders.
Stilianos Mavroulis, 68, was sentenced to 40 months in prison, and his son, Kyriakos Mavroulis, 31, both of Baltimore, Maryland, to a year and two days in prison, each followed by three years of supervised release, for embezzlement and unlawful conversion of government property in connection with a scheme to defraud the Government National Mortgage Association of $1.3 million.
According to the Wall Street Journal, two adjacent Fifth Avenue apartments listed by the estate of the late copper heiress Huguette Clark have sold, for $12M and $19M each. WSJ didn't name the buyer, but The Real Estalker seems convinced that the purchaser in question is none other than the Prime Minister of Qatar, otherwise known as Hamad bin Jassim bin Jaber Al Thani. The P.M. might go even further by making an offer on a set of adjacent apartments one floor below the Clark spread, listed together for $25M. If he makes it past the co-op board, the fabulously wealthy Qatari—who spent something like $250M on his yacht—would possess 15,000 square feet of coveted park-front space with more than 40 rooms.
· Real Estate Rumor and Gossip: Huguette Clark [The Real Estalker]
· Farewell Huguette Homes; Full Tally for Heiress Apts. $55M [Curbed NY]
Frederic Alan Gladle, 53, Austin, Texas, was sentenced to 61 months in prison and was ordered to forfeit $84,010 for his role in operating a foreclosure rescue scam in Southern California and elsewhere that charged distressed homeowners fees in exchange for fraudulently delaying foreclosure sales.
George Cavallo, his wife, Paula Hornberger, and Joel Streinz, a former police officer, were found guilty by a federal jury of conspiracy to commit wire fraud and of making false statements on loan applications submitted to FDIC-insured financial institutions and mortgage lenders.
ForTheBestRate.com announces that mortgage pricing fell for the second consecutive week, reaching new historic low points for fixed rate products.Wilmington, NC (PRWEB) May 07, 2012 Mortgage rates were down on average this week, reports mortgage rate research website, ForTheBestRate.com. This represents a second week of falling home loan pricing, with 30 year fixed and 15 year fixed programs ...
Real estate tax rate increase appears likely in Bristol, Va. TriCities.com
An increase in the real estate tax rate appears likely if City Council approves the current version of a proposed $83.2 million fiscal 2012/13 budget. Barring any change, the real estate tax rate is expected to rise 5 cents, from 94 to 99 cents per ...
The online lending industry website, Reallybadcreditoffers.com has revealed homeowners are seeking mortgage refinance options to save their homes and if unable, are choosing to declare bankruptcy rather than facing foreclosure.New York, NY (PRWEB) May 07, 2012 The popular online lending authority, Reallybadcreditoffers.com has announced an increase in home refinance inquiries, and alternatively ...
FHA Expert Moves Up from Second Position to Tops in Nation With More than $640 Million/58 Transactions Closed in the First Half-HUD FY2012Columbus, OH (PRWEB) May 07, 2012 Red Mortgage Capital, LLC, consistently one of the nation’s most active FHA MAP & LEAN lenders, is proud to announce it is the country’s top lender of FHA MAP loans for volume activity through the first half of HUD’s Fiscal ...
The index takes a different approach than the primary indices already in use, namely Case Shiller, FHFA and NAR Existing Home Sales. It’s an intriguing approach to refine the accuracy of measuring housing markets.
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Via Skype, I have a great conversation with Alan Mark, founder and president of The Mark Company. Based in San Francisco, his firm is well-known for its work with new development, conversion and project turnarounds throughout the Western US. His firm specializes in design consulting, market research, sales and marketing.
Originally from the New York region, he has made a name for his firm in new development marketing arena and explains how he adapted his firm to the post-credit crunch world.
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I finally got to meet and have a conversation with Florence Quinn, Founder and President of Quinn & Co., a leading public relations firm specializing in food, wine + spirits, real estate and travel. Her practice continues to grow, providing services for both national and international clients.
Florence built a highly respected and successful practice with a wide array of expertise from her team who seems to be everywhere these days. She has always been on my radar – many thanks to Lara Berdine for getting us together.
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Here’s a brief recap of the results of the 3Q 2010 Manhattan Rental Market Overview I released a few weeks ago. I am tardy getting this online and recorded it on my iphone late in the evening at my hotel while at a conference. I’m not up to my sharpest delivery with a bunch of “ums” but as they say (whoever “they” is), it should all about the content or am I getting that confused with “right or wrong spell my name right?
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Adam has written a guide for first-time home buyers through the purchase process: Finding the Uncommon Deal: A Top New York Lawyer Explains How to Buy a Home for the Lowest Possible Price, that is scheduled for release by John Wiley & Sons in April 2011.
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I sit down with Doug Heddings, founder of The Heddings Property Group and blogger at True Gotham. He’s a long time top producing real estate broker who made the move to start his own company, with his own take on the real estate brokerage model…and its working.
I do my best to keep kitchen appliance references (note appliances over my shoulder) to a minimum while we talk about brokerage models, the challenges of social media and making that entrepreneurial leap.
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Last week I wrote a post on Matrix called [Shortsighted] Appraisal Institute Decides To Leave Appraisal Foundation where I expressed my frustration at the rift between The Appraisal Foundation and one of its sponsoring organizations, The Appraisal Institute. I thought high drama was the purview of real estate brokers and economists. The situation seemed to have morphed into a he-said, she-said type debate. I am concerned that in a time of unprecedented housing market turmoil we are left with no leadership as an industry and no ability to participate in the debate to shape our future.
Well balanced views and comments on the matter, Jonathan. I’m seeing quite a lot of misinformation and misstatements of the facts (in some cases amazingly far from the truth) among the online discussions and emails out there. I am happy to speak directly to any appraiser groups that may have concerns or questions and clear up any confusion.
Not able to let a podcast guest opportunity to pass me by, I reached out to David to have a conversation. He agreed and I very much appreciated his candor and clarity. Among his many accomplishments, David is
I have a great discussion with Jon Gollinger, Founder and CEO, Accelerated Marketing Partners who sets me straight on the concept of accelerated marketing as a process (hint: it’s not all about auctions).
Jon pulls no punches when it comes to understanding the consumer – they are the ones who set market price. I have long admired his skill in creating a market environment that attracts real participation, best exemplified in his company slogan:
“You bid it, you win it.”
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I spoke via Skype with Ian Huckabee, who is a web marketing strategist/technologist, self proclaimed Chief Weejee at Weejee Media and developer of DwellWell. He has a unique background with audio and marketing stints at Sony and a successful home builder.
Our mutual friend Andrea Powell, when she is not a vampire, suggested we would get along famously (no pun intended).
Ian’s got great insights into social media and I really enjoyed the conversation.
I’ve known Jeff Appel for many years as one of the leading mortgage consultants and experts in the New York City metro area. Jeff is a Vice President at Bank of America Home Loans and co-host along with Cathy Hobbs of Metro Residential that airs 11am Sundays on WPIX Channel 11 in the NYC metro area.
Last week Jeff invited me to speak on a panel he was moderating and I thought he provided some invaluable insights on the state of the mortgage environment for residential housing so I asked him to join me on The Housing Helix.
I really enjoyed speaking with Orest Tomaselli, CEO, National Condo Advisors, LLC about project approvals, reserve funds, Fannie Mae, FHA and shadow inventory. National Condo Advisors, LLC, is comprised of real estate finance and legal professionals and provides expert consultation to builders, developers, homeowners’ associations, institutional investors, lenders, and real estate firms.
His other firm National Condo Inspections, LLC provides services such as reserve studies, phase I environmental site assessments, noise studies, and flood zone solutions.
A while back, Erica Ferencik cold-called me to pitch her self-published novel as blog-worthy for Matrix called Cracks in the Foundation, a humorous story of real estate broker who has listed an outhouse for sale. She is an active real estate broker in the Boston area (including the town I grew up in, the ‘ham). She was a stand-up comedienne for 12 years as she describes, “in a prior life.” She has ghost-written several novels, writes articles for magazines and websites, is a prizewinning screenwriter and has performed several radio pieces for WGBH (Boston NPR affiliate) for “Morning Stories.”
I thought it would be fun to have a conversation with her, and of course, it was.
I “peel the apple” with Ana Maria Sencovici of The Apple, Peeled and end up having a great conversation about helping the real estate broker move from salesperson to trusted advisor. She and her business partner Marie Espinal launched their blog and newsletter at the beginning of the year. Their focus is to provide content that their clients, who are real estate agents, can use to help them stay connected with the issues of today to be more effective.
Ana Maria is passionate about their mission (and I am paraphrasing) to elevate the level of discourse in the world of Manhattan real estate covering markets trends, real estate topics and developments with a transparent and objective lens.
The paper is essential reading as we go through a period of financial reform. The report is described as a timely assessment of alternative proposals for the future of Fannie Mae and Freddie Mac, ranging from nationalization to dissolution. The paper explains the role Fannie and Freddie have played, explores the goals a healthy secondary market for both single- and multifamily housing should serve, and develops a framework to help understand and evaluate the various proposals for reform.
Last January I moderated a distressed property panel at the Inman Real Estate conference in New York. One of the panelists was Travis Waller, a sharp real estate agent from New Jersey who spoke with great clarity on his specialty, distressed real estate. In this podcast we have a great conversation via Skype on what life will be like after the end of the federal tax credit for first time and existing home buyers, how banks are coming to grips with property disposition, differences between short sale and foreclosure transactions, marketing distressed property, to name a few.
It’s great insight from someone who deals with distressed property first hand. Follow Travis on Twitter.
I sat down with Dottie Herman, President and CEO of Prudential Douglas Elliman Real Estate to talk about her journey from certified financial planner to one of the most successful real estate brokers in the United States. Dottie leads an organization of 3,800 real estate professionals and 675 employees in more than 60 offices. Its a candid and insightful conversation, and of course, fun and energetic.
We spoke right after our live weekly radio show “Eye on Real Estate” on WOR710 that Dottie hosts on Saturdays from 10am to noon along with her team of experts (including moi).
I have a candid conversation with Chris Meyers, COO of Houlihan Lawrence, the largest real estate brokerage firm in Westchester County, New York. A family business, Houlihan Lawrence has 1,200 agents and 24 offices to service Westchester, Putnam and Duchess Counties.
We talk about many things including the housing market of the past 18 months, finding good agents and the introduction of social media to the real estate brokerage business.
I have a great conversation with Leah Caro, President and Principal Broker of Bronxville-Ley Real Estate and President of Westchester Putnam Association of Realtors. I met Leah when I was the keynote speaker at the last two annual Westchester Real Estate, Inc. awards luncheons. She is a candid and knowledgeable real estate broker who is very active within her profession, currently serving as the Chair of the Professional Standards Committee for the New York State Association of Realtors, and is a Director in both the State and National REALTOR Associations among others.
“Williams is a 15-year veteran of the IT industry, having served stints with Cisco Systems and PolyServe, a software startup acquired by HP. At one time he was co-owner of Carolina Appraisers, a real estate appraisal firm based in Raleigh.”
AIMS stands for “appraisal independence management system,” and “dashboard” is a software term meaning a control panel housing two or more applications.
His venture was enabled by introduction of the May 1, 2009 agreement between Fannie Mae and NY Attorney General Andrew Cuomo known as the Home Valuation Code of Conduct.
AIMSdashboard is intended to help financial institutions take back control of the mortgage process through a software solution. Chris was very quick to point out that his company is a software company, NOT an appraisal management company.
Think lender pressure on appraisers is a distant memory? Think again. Here is some commentary on a new report that indicates appraisal fraud is up 50% over the past year. It is laid out in Kenneth Harney’s excellent column in the Washington Post.
I also provide commentary on a recent episode with a bank client we now refuse to work with who pressured our firm to raise the appraised value of a property or they would not pay us for services already rendered.
In fact, they didn’t really understand what they were saying.
Last month I spoke to and interviewed Tony Pistilli, a certified real estate appraiser on the Minnesota Department of Commerce Real Estate Appraiser Advisory Board. He’s got a possible solution to the current appraiser – appraisal management company conflict. Its all about conforming to RESPA and preventing banks from shifting the burden to appraisers to pay for bank compliance.
Its the first logical solution I’ve heard. The banks are essentially making the appraiser pay for their RESPA compliance by taking it out of the appraiser’s fee, often 50% of the stated appraisal fee. The consumer is being mislead by the appraisal fee stated by the lender at time of mortgage application.
- Appraisers and borrowers are paying for services the banks receive, not the bank.
- Banks should pay for the services received from the AMC’s who manage the appraisal process.
- Appraiser’s fees should be market driven.
- Banks should be held accountable for the quality of the appraisal.
He’s been spreading the word through all the channels/usual suspects in the blogosphere. Here’s my original post, including his article:
Last month I was a panelist at an Institute of Real Estate Management (IREM) conference covering lending trends. I was matched up with 2 lenders and attorney Steven Einig. I appreciated his take on the escalating foreclosure situation and his ability to articulate it.
Last Thursday we published our 1st Quarter 2010 Brooklyn Market Overview and since I am in the throes (sp?) of working on our upcoming Long Island and Hamptons/North Fork reports to be released later this week, I am tardy posting my quick summery to the site. I view this particular podcast as basically an excuse to play with my iPhone recording software but there is some fairly coherent info presented on the numbers presented in the report. Check it out.
This is a belated podcast covering the Queens Market Overview I released last Thursday – that I recorded impromptu on my iPhone but then didn’t upload until today.
How I did it – Once I record the podcast on my iPhone, I am able to convert the file to an mp4 fomat on my iPhone, upload the file to my ftp server. I then grab the file from my ftp server and copy it onto my laptop, move it into the Garageband app, add the intro and outro, apply the filters, convert to a new mp3 file and export into iTunes and then upload to this blog. Phew!
I really enjoyed my conversation with Candace Taylor, writer for The Real Deal Magazine, one of the best resources for residential real estate news in NYC. She covers real estate all day long and we speak about many issues including square footage discrepancies and getting people mad.
This is also the first time I used my iPhone to capture the audio using the FiRe app, but relied on its built-in internal mic and then applied filters in Garageband. I’m surprised how well the sound quality is given the mic I used. But I digress…
The Wealth Report 2010 was released today by Knight Frank. It is a much anticipated annual survey targeted at the high end consumer with great detail on global residential property trends. I have had an ongoing exchange of ideas and have followed their research for quite a while. I was invited to provide commentary on the New York City market which is included in the report. In this podcast I interview Editor Andrew Shirley and Liam Bailey, Head of Residential Research. The interviews were conducted via Skype to their London offices so the quality is a bit lacking. Nevertheless the quality of their conversation is terrific.
After moderating a foreclosure panel at the recent Inman Real Estate Connect conference in New York, I thought it would be great to have a conversation with one of the panelists, Phil Tesoriero principal of Gelip Inc. Consulting. A former New York City Firefighter, his experience includes rehabbing REO’s and distressed properties as an investor and contractor, working as a sales agent specializing in the sale of HUD and REO properties and owner of a real estate brokerage firm, Phil now helps real estate professionals with the sale and management of distressed real estate.
In this podcast I check in with Dave Perry, Director of Sales and Leasing for The Clarett Group, a real estate development company. I’ve known Dave for for a number of years and was always impressed me with his understanding of pricing.
Its been a year since I ventured into the world of podcasting. I ended up with 76 podcasts (not including this one) totaling 1.4 days of audio and 1.17 gigs of mp3 files, fraught with audio and hardware challenges, Skype, a new laptop, multiple types of microphones (usb, xlr, lavalier), mixers, cables, scheduling, web site issues, WordPress plug-ins, Amazon S3 and bandwidth made this a year to remember (for me anyway).
Thanks so much for listening!
The idea was to bring the real estate conversation into long form, something I wasn’t able to find anywhere else. I’ve always loved content you could listen to while commuting that wasn’t sound bite driven and shallow.
For original subscribers, periodic and new listeners, I hope you’ve enjoyed it! I certainly have enjoyed bringing it to you.
In 2010 I plan to deliver more content, more timely uploads (2x per week), off site interviews and a wider interview base, I still need your feedback and suggestions. I was thinking regular days ie Mondays, Thursdays with special reports interspersed.
While I don’t really have a master plan (despite wide spread rumors of my intentions of global domination) other than this being a fun, entertaining and informative endeavor, I feel strongly that it will lead to other things. It may already have! More on that later this year.
I speak with Nancy Chemtob, a partner with Chemtob Moss Forman & Talbert, LLP a New York City law firm specializing in divorce, family and matrimonial law. My firm has done a lot of work with Nancy and her partners over the years and admire her approach and candor. Plus she’s fun to talk with.
The biggest asset in a divorce action is most often the real estate. The housing market crunch of the past 18 months has played havoc with the divorce process. What’s most interesting is the fact that divorce attorneys are often at the leading edge of a changing real estate market as their clients deal with the reality of market conditions within their strategy.
Note: I’ve got a new equipment set-up (again) and I am still wrangling with it so my audio track is a bit too loud. But Nancy makes her presence heard.
I had a great discussion with Steve Wagner, an attorney who specializes in representing co-ops/condos, litigation and technology, among other areas. I have worked with his firm Wagner Davis, P.C. over the years on some crazy cases.
Steve has a wealth of knowledge, but don’t get him started on grandfathering in co-ops. Listen to find out why.
I have a great conversation with Ryan Slack, Founder and CEO of Green Pearl Events aka Green Pearl that specializes in real estate events for industry professionals across the US. Ryan was a co-founder of Property Shark before he started Green Pearl Events. He is all about delivering reliable information to his customers.
We cover a lot of ground including his background and some insights on social media I had never heard before.
Here’s a schedule of upcoming events hosted by Green Pearl Events.
Here is a brief recap of the 2000-2009 Manhattan Market Market Report my appraisal firm Miller Samuel prepares for Prudential Douglas Elliman. Its 92,000 data points in 53 markets crammed into 61 pages of phonebook-like data bliss.
Here is a brief recap of the 2000-2009 Manhattan Townhouse Market Report my appraisal firm Miller Samuel prepares for Prudential Douglas Elliman. Its a ten year look at a niche high end market that comprises 2% of all Manhattan residential sales.
Here is a brief recap of the 4Q 2009 Hamptons/North Fork Market Overview and 2000-2009 Hamptons/North Fork Market Report my appraisal firm Miller Samuel prepares for Prudential Douglas Elliman. Its a grains of sand datafest.
Miami-based Douglas Elliman has had my Miami market report handiwork translated to both Spanish and Portuguese to better serve their South American clientele. Market demand from South America has been a significant force over the past year and a half. The weak US dollar continues to be one of the factors driving housing demand in Miami and one of the key reasons why the non-distressed market continues to thrive.
I took five years of French in high school so it’s a bit disorientating to see my analysis translated, but very cool at the same time. We are expanding our South Florida market analysis significantly over the next several months (no, France is not on the rollout list…yet).
Overall housing prices (median sales price up 1.2% ) continued to show stability.
The luxury market showed larger year over year increases in the price indicators than the overall market.
Number of sales were up nominally from same period last year (0.5%).
Listing inventory is down sharply year over year (down 17.5%) – home sellers are more cautious about entering the market (ie sales flat but inventory falling).
Properties taking somewhat longer to sell and there is a little more negotiability on price between buyer and seller (days on market and listing discount expanded)
Despite strength in prices at high end, we saw an uptick in market share of sub-million sales – the decline in mortgage rates and warm weather brought buyers out sooner.
Here’s an excerpt from the report:
Median sales price edged up 1.2% to $630,000 from $622,500 in the prior year quarter. Average sales price increased 17% to $1,437,597 from $1,228,857 over the same period, largely due to continued strength at the upper end of the market. In the median sales price by quintile analysis, the fifth quintile increased 24.8% yearover- year, while the remainder of the market segments showed modest change and mixed results over the same period…
Housing prices were mixed – median sales price unchanged 0% but average sales price fell 5.4%. The drop in mortgage rates shifted mix to lower priced homes.
Pending sales unexpectedly jumped from year ago levels (+21.2%) as mild winter weather brought consumers into the market earlier than usual.
The luxury market was somewhat weaker than the overall market. Luxury median price slipped 2.6% year over year.
Listing inventory was also down (4.1%) as sellers were more cautious about listing their homes.
Properties taking somewhat longer to sell and there is a little more negotiability on price between buyer and seller (days on market and listing discount expanded)
Here’s an excerpt from the report:
Although the number of sales slipped 1.2% from prior year levels, the mild winter weather brought an unexpected surge in first quarter pending sales. There were 5,209 signed contracts outstanding in the first quarter, 21.2% more than 4,297 in the prior year quarter. The unusual amount of pending sales activity this quarter may temper the levels of the second quarter, typically a high water mark for sales activity each year. Listing inventory slipped 4.1% to 20,358, the lowest first quarter total in six years…
Quest Magazine asked me to write an intro piece on the luxury housing phenomenon i.e. “Real Estate Renaissance” followed by a number of housing types from the markets they publish within. Quest is a beautiful magazine with some interesting editorial perspectives and great visuals on high end real estate.
Here’s what I wrote (I’m arguably the driest writer in the magazine, but hey, it’s how I think):
Real Estate Renaissance: Jonathan Miller – April 2012
One of the primary characteristics of the U.S. coastal housing markets, after the dust settled from the collapse of Lehman Brothers, has been a sustained period of high-end market strength. Trophy properties are seeing new demand.
The sudden end to an era of reckless bank underwriting and subsequent entry into a period of fiscal austerity was expected to disproportionately crush the luxury housing market. Easy access to credit allowed for many consumers to live beyond their means.
The onset of the credit crunch led to the overnight evaporation of the secondary market for jumbo mortgages, too large to be purchased by ailing Fannie Mae and Freddie Mac. While the federal government focused on the former GSEs, little attention was given to improving access to mortgage financing for high-end housing. Banks now have to hold jumbo mortgages in their own portfolios rather than offload the risk to investors hungry for bigger returns. The much tougher jumbo mortgage financing requirements were expected to bring a collapse of high-end housing prices and grind sales activity to a halt. But that isn’t how it played out. The price spread between high-end and starter homes has expanded over the past several years despite irrational mortgage underwriting standards for jumbo mortgages. In fact, a remarkable number of home purchases at the high end of the market have been paid with cash rather than obtaining mortgage financing at commercial banks, thereby bypassing the lending industry’s legacy of poor lending decisions in the prior decade. The global accumulation of wealth during the global economic boom enabled many investors after its end to seek out luxury housing in the U.S., helping coastal markets outperform others.
The weakness of the U.S. dollar against other foreign currencies, specifically in Europe, South America, and Asia has brought investors to U.S. soil in droves. Initially, this was viewed as a currency play where wealthy foreign investors were simply taking advantage of the sharp discount for U.S. housing. While the favorable exchange rates may have tipped the balance towards the acquisition of U.S. assets like housing because of the perceived discount, investors were also moving their assets into a relatively more politically and economically stable environment.
Will the use of cash in housing purchases continue? It seems likely, perhaps out of necessity. Rational jumbo mortgage underwriting standards and the creation of stable secondary market for jumbo markets is not expected to return for years. Once those problems are eventually resolved, the widening gap between luxury housing and the balance of the market could very well widen further.
Trulia’s Chief Economist Jed Kolko keeps punching out dials and gauges on the housing market. He’s also got a “Price Monitor.” These tools are really growing on me because they provide context to the current state of the market – something that is sorely missing.
With his Housing Barometer, he combines three key housing market indicators:
new construction starts (Census)
existing-home sales (NAR)
the delinquency-plus-foreclosure rate (LPS First Look).
It’s time to share my Three Cents Worth on Curbed NY, at the intersection of neighborhood and real estate in the capitol of the world. And I’m simply here to take measurements.
By far the three most popular observations about the Manhattan housing market to date in 2012 are: “mortgage rates are at historic lows” and “listing inventory is tight” and…ok, there are just two that are worthy.
I thought I’d mash them together and see what happened since I’ve never made the direct association. Admittedly I was surprised with the visual that resulted….
Recently I was contact by The Real Deal Magazine to take a look at the correlation between the stock market performance and the housing market. I personally don’t believe it and I have written about correlation and how silly it can get.
The thinking goes like this:
The Dow Jones Industrial Average rises, the housing market rises = correlation = a housing market indicator, but…
“Twenty-five percent of New York City wages come from financial services,” Miller said. “It’s part of the fiber of being here and so there’s always been a propensity to correlate the Dow Jones industrial average with housing here. I don’t ascribe to that belief. Housing is not a stock. [Rather,] if you have a robust and actively traded market, in theory, employment is more likely to be stable, which consummates sales transactions.”
When I think about the housing rebound in the dark days just after the Lehman tipping point and how stock-market orientated we are in Manhattan, the only thing that seemed to push consumers back into the market was the roar of the stock market in the first quarter of 2009. This comparison against sales (transactions) seems show the same trend. While I’m still not on the correlation bandwagon, the 20-year trend is quite compelling.
Last fall Prudential Douglas Elliman turned 100 years old and they asked me to write an article for their Elliman magazine. If you’ve been living in a cave, I’ve been writing their housing market report series since 1994.
What started as a simple project morphed into a fun, albeit gigantic, research project. I learned a lot about the evolution of the Manhattan housing market, largely through the amazing incredible New York Times archives. This was right about the time of my web site revision and semi-necessary hiatus so I am cleaning out my desk of posts I have been itching to write so please indulge me.
The article I wrote for Douglas Elliman was beautifully presented by their marketing department and prominently inserted in their Elliman magazine (and iPad app!).
Diane Cardwell of the New York Times in her “The Appraisal” (an incredible column name BTW) penned a great piece: In an Earlier Time of Boom and Bust, Rentals Also Gained Favor that originated from my article and zeroed in on the 1920s and 1930s to draw a comparison to the current market.
I have the feeling my project is going to morph into something bigger – it’s just too interesting (to me). A few things I learned about the Manhattan market over this period:
Douglas Elliman published the first market study in 1927 [heh, heh] not counting other marketing materials written before WWI)
Real estate media coverage in the first half of the century was social scene fodder (same as today) but with extensive and excessive personal details presented on tenants, buyers and sellers yet housing prices and rents were rarely presented in public.
Manhattan made a rapid transition from single family to luxury apartment rentals and eventually co-ops.
Housing prices and rents by mid century weren’t that much different than the beginning of the century.
Manhattan’s population peaked at 2.3M around WWI.
Wall Street in the 1920′s was seen as the driver of the real estate market.
Federal and state credit fixes in the late 1930′s help bail out the housing market.
• Change Is The Constant In A Century of New York City Real Estate – pdf [Miller Samuel]
• My Theory of Negative Milestones [Matrix]
Sidebar/Appendix
Here’s a separate piece I also wrote during my DE research project (to clear my head after pouring through all the historical articles) which incorporates my “theory of negative milestones.”
While researching the last 100 years of New York City residential real estate I came to appreciate the one constant in the ebb and flow of housing. It is a market that has continually adapted to significant economic, political and social change. History showed us that the New York City housing market reacts to this change as an opportunity to reinvent itself resulting in more growth.
Despite significant challenges, the New York has thrived during its transition from an industrial to service economy as a core driver of housing demand. Over the past 100 years, the city has been held together by a diverse economy linked with other economic capitals across the globe. Yet like the economy of today and the early part of the 20th century had a commonality in financial services. It remains an important sector, driving the creation of wealth and influencing the demand for housing.
“With the continued prosperity of the country as a whole and the tremendous activity in Wall Street, there is no reason why the new year should not be an extremely prosperous one in the real estate field.” – 1927 Douglas L. Elliman & Co., Inc. report (NYT)
Because the series of milestones is measured in decades and we live in the moment, it is hard to appreciate the many changes that define the housing market we currently enjoy. The housing stock moved from dependence on single unit dwellings to apartment rentals to co-operatives to condominiums. It has ranged from overcrowded tenements to newly developed luxury highrises. The addition of new housing or re-purposing of existing structures has resulted in a wide array of residential property that forms the texture of the New York City real estate market.
An irony of this evolving housing legacy comes from the sense of permanence that resonates from simply gazing at the physical asset both as a shelter and as a home. Leaf through “before and after” photo books of New York and the revolving landscape is readily apparent.
Historic milestones mark the moment of change in the housing market, making conditions that existed before largely irrelevant to the “new” market, prompting new patterns and incentives. Participants seek out understanding and then re-enter the market.
Here’s a Manhattan timeline that includes a rough survey of luxury pricing.
1910’s The surge in demand for housing, World War I
[Sale: $8 PPSF, Rent: $40/Mo.]
A bustling economy, railroads were thriving and Manhattan’s population was at its peak of 2.3 million as it moved towards World War I. Over the prior 30 years, the Upper East Side and Upper West Side had transitioned from farmland with single family houses to higher density tenements and apartments. The Zoning Resolution of 1916 was a comprehensive zoning law passed to require height and setbacks to new building so the surrounding streets could receive natural light. By now, rents were double those of comparable properties in Paris.
1920’s The “Roaring Twenties”
[Sale: $15 PPSF, Rent: $60/Mo.]
The decade result in rising prices in a 1927 market report by Douglas L. Elliman & Co., Inc. Building sites were becoming increasingly scarce on primary streets, best suited for apartments causing development to press east. By 1929, Elliman reported that land prices along Park Avenue had risen 44% over the prior several years. Prices of co-operative apartments with views of the East River were seeing rapid appreciation. Prices of Sutton Place co-operative apartments jumped 75% over the same period.
1930’s The 1929 Stock Market Crash and “The Great Depression”
[Sale: $5 PPSF, Rent: $45/Mo.]
Sales fell by 30% a year after the crash, but by the middle of the decade, the rental market began to improve. Douglas L. Elliman & Co., Inc. reported a 22% increase in the number of signed leases on the East Side. Rents increased 6% over the prior year and some buildings were reporting 100% occupancy. “…this will enable many properties to be placed on a sound financial basis where taxes and interest and other fixed charges can be met regularly for the first time since the depression.”
1940’s World War II
[Sale: $8 PPSF, Rent: $50/Mo.]
Manhattan townhouses sales begin to pick up but prices remain below peak levels during the “Roaring Twenties.” On the 30th anniversary of Douglas L. Elliman & Co., Inc. the company reported the highest number of rental transactions in its history. “Apartment builders are more active now than at any time in nearly a decade in the construction of new multifamily buildings on the East Side of Manhattan.” After the war ends, New Yorkers face a housing shortage as GI’s returned home. Large scale housing developments emerged.
1950’s The post-World War II Housing Boom
[Sale: $12 PPSF, Rent: $60/Mo.]
The housing boom was the product of pent-up demand from the prior two decades as household formation was outpacing supply. Apartment and co-op demand increased as buildable space became scarce. As the economy grew, the midtown central business district expanded. At least 15 large apartment buildings on Park Avenue just north of Grand Central Terminal, known as the “Gold Coast” were replaced by office buildings. Only 40 years earlier that location had been created by covering the railroad tracks north of the terminal.
1960’s First condo building, World’s Fair, Building Boom
[Sale: $25 PPSF, Rent: $200/Mo.]
The 1961 Zoning Resolution updated the zoning principals established in 1916 establishing parking areas and open plaza design in exchange for additional floor height. The World’s Fair exhibition opens and the first condominium building begins its sales effort. The introduction of air conditioning and in-house intercoms became standard. A three year building boom occurred mid-decade and co-op sales prices peaked by 1969.
1970’s World Trade Center Completed, Near Bankruptcy, Finishes Stronger
[Sale: $45 PPSF, Rent: $335/Mo.]
The first half of the decade saw the completion of the World Trade Center, a weak economy and surging oil prices. Weak conditions were punctuated in 1975 with New York City narrowly avoiding bankruptcy despite the famous October 30 New York Daily News Headline “Ford to City: Drop Dead” (which the president didn’t actually say). The second half saw improvement with a 1979 market survey by Douglas Elliman-Gibbons & Ives, Inc. indicating that co-op prices were up 224% since 1974.
1980’s Co-op Conversion Boom, “Black Monday” Stock Market Crash
[Sale: $250 PPSF, Rent: $1,700/Mo.]
This decade will be long identified with the enormous volume of rental to co-op conversions. Pre-war and post-war rental building were rapidly converted to co-op apartments and the phrase “insider pricing” for a tenant became the object of envy by those who were not. The 1987 stock market correction cooled off the conversion frenzy market leading into the next decade.
1990’s From Recession to Lofts and the “Silicon Alley” Dot-Com Boom
[Sale: $590 PPSF, Rent: $3,200/Mo.]
The New York City housing market began the period in recession. The city adopted a “broken windows” theory to focus small details to improve the “quality of life” for its residents, resulting in significant unsung benefits for the housing market in the future. As the economy improved, the downtown loft market evolved into a mainstream part of the housing market. It was a perfect fit for the booming tech sector that provided a worthy counterpart to “Silicon Alley” on the west coast. The Lincoln Center area sees the beginning of significant luxury condo development.
2000’s 9/11 to Housing Boom to Lehman
[Sale: $1,200 PPSF, Rent: $3,800/Mo.]
After the events of 9/11 stunned the world, the housing market took less than two months to restart. The Federal Reserve pressed interest rates to the floor and the consumer responded quickly, leading to one of the largest periods of new development in the modern era. Wall Street enjoyed record compensation as the regional economy and the housing market thrived. The credit boom that fueled this growth in activity came to an end with the Lehman Brothers bankruptcy in late 2008, but began a rebound the following year.
2010’s Quick Rebound, Tax Credit and Housing Seasons
[Sale: $1,070 PPSF, Rent: $3,500/Mo.]
The decade began with a rebound in sales activity and the introduction of an expanded federal tax credit for new and existing homebuyers. By 2011, the housing market began to return to more normal seasonal patterns after several years of volatility. The August 2011 historic downgrade of US debt caused global investor panic and pushed mortgage rates to all time historic lows but credit remained unusually tight. Trophy property sales, including an $88m condo purchase by a Russian billionaire became more common place as the weak US dollar enticed luxury purchases by foreign buyers yet the balance of the market remained stable, albeit fragile.
Of course there will always be more milestones for New York City to grapple with and that’s the constant above the fray.
We released our report on the Manhattan co-op/condo market for 2002-2011 this morning. This report is 60 pages of data bliss as far as I’m concerned. More than 100,000 sales collected, cleaned, sliced, whipped chopped and pureed.
Absolutely love the cover photo the graphics people selected.
I’ve been authoring this market report series for Douglas Elliman since 1994.
Co-ops and condos consistently account for roughly 98% of Manhattan residential sales. Manhattan is primarily a rental market and single family sales are a very specific high end niche market.
Here’s an excerpt from the report:
The number of sales remained above the 10,000 sale threshold for the second consecutive year and for the fourth time in the decade. There were 10,161 sales in 2011, the third highest total of the decade. The total was 1% above the prior year total of 10,060, but 24.3% below the 2007 housing boom peak of 13,430. The weakest period of sales activity for the decade was in 2009, the year after the “Lehman tipping point” in late 2008, when the credit crunch and low consumer confidence stifled sales activity. The second weakest period surprisingly occurred in 2005, after affordability fell sharply with the highest pace of price appreciation in the decade. The last two years of the decade saw the most sales of 3-bedroom and 4-bedroom apartments as the market benefited from unstable global economic conditions. Foreign buyers and the wealthy continued to seek financial refuge in the high-end Manhattan housing market.
The custom data tables are updated and ready for you to play with. The chart section on the new site remains a work in progress.
Last year I got an email from a Matrix reader, Ben Tanen, a former VC now running his own investment partnership that invests in public companies, with an interesting take on the buying power of gold as it relates to Manhattan apartments.
Like many things in my life, I let this “nugget” (sorry) slip through the cracks last year. He recently updated it with our new numbers in the recent release and it’s quite compelling.
The value of gold has risen sharply in recent years during the wobbling of the global financial markets – investors see precious metals like gold as a way of preserving purchasing power over the long run. In fact, in 2011, gold had more purchasing power relative to Manhattan real estate than at anytime during the past 22 years (the limit of our publicly released data).
It would take 908 ounces of gold to purchase the average Manhattan apartment versus the 1996 low point of 1,030 ounces, a point where many think our asset bubble problems began (stocks, then housing).
I’ve been on a 6 month hiatus from podcasting after 150+ interviews over the previous 2 years – had a bunch of other things going and I needed to take a little break. I’ve been itching to return and was talking to my friend Barry the other day and he wanted to do another one (his 3rd) and here it is.
It’s “R”-rated (for Ritholtz) so wear your earphones if around sensitive-types as he covers the state of housing, a possible recession and his exciting conference next Tuesday.
This podcast was too big so I cut it into 2 parts. The first part was presented yesterday.
Enjoy!
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I’ve been on a 6 month hiatus from podcasting after 150+ interviews over the previous 2 years – had a bunch of other things going and I needed to take a little break. I’ve been itching to return and was talking to my friend Barry the other day and he wanted to do another one (his 3rd) and here it is.
It’s “R”-rated (for Ritholtz) so wear your earphones if around sensitive-types as he covers the state of housing, a possible recession and his exciting conference next Tuesday.
This podcast was too big so I cut it into 2 parts. The next will be up tomorrow.
Enjoy!
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I had the pleasure of speaking with Guy Kawasaki, former Chief (Software) Evangelist at Apple Computer in the early days of Macintosh – who has become a prolific author in addition to being a technology entrepreneur. While I claim to avoid the self-help book genre, I realize I’ve read nearly all of his books. Guy released his 10th book today: Enchantment: The Art of Changing Hearts, Minds and Actions. Here are some reviews.
His first book, The Macintosh Way, is now a free download and was always one of my faves – because it came out as we were building our company, Miller Samuel, entirely by using Macs. He later ran ACIUS, developer of 4th Dimension, the database application we ran for about 15 years to manage our data.
This was a pure treat for me as I got to talk about the early days of Apple, reminisced about Guy’s one word email technique (I shared my 15 second voicemail rule), his other ventures such as Alltop.com and Garage.com, the state of marketing today and how to make yourself enchanting.
Fun!
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I was brought in by RealEstate Business Intelligence (RBI), the statistics and research arm of MRIS to further their effort to provide more transparency in their regional housing market. One of the first things I did with their information, whose depth and quality is unlike anything else I have ever analyzed, is build a pending home sales index for the Washington, DC Metro and Baltimore Metro markets.
The biggest problem in understanding the state of housing today is the quality and timing of the information. This podcast is a review of my thoughts on the subject and why a pending home sale index tends to be better at providing the state of a housing market than price indices.
Hint: they lag the moment when buyer and seller agree on a price aka “meeting of the minds” by as much as 5 months, don’t consider the different seasons of the year and are often skewed by seasonal adjustments.
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Barry is the only person I know who is described as providing “trenchant economic commentary” -(Norris/NYT) in fact, I’ve never even used “trenchant” in a sentence before now. Barry makes his 3rd visit to The Housing Helix podcast and he does not disappoint his fans for the depth of his insight.
This is an R-rated (“R” for “Ritholtz”) podcast – children, young adults, rating agencies and commercial bankers beware.
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Here’s a quick and dirty recap of the Manhattan Market Overview released today that we prepare for Prudential Douglas Elliman. Audio quality is so-so because I used my iphone mic and then tried to clean it up with filters.
You get the idea.
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I sit down with my friend John Mehigan, an associate broker at Gumley Haft Kleier who, when he is not selling real estate, is in the cast of HGTV’s number one show Selling New York (new season on HGTV premieres at 9pm EST). We talk about his perspective on the Irish economy/Mahattan housing market and what I dubbed the “Irish Carpenter Syndrome” a few years ago as the Celtic Tiger was at full strength.
When he’s not selling on “the island” he’s selling an island in his first episode on January 13th on HGTV at 9pm. It promises to be fun (like the conversation on this podcast).
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I got to interview my namesake, Jonathan Miller who is the longtime author of the seminal publication Emerging Trends in Real Estate, the Urban Land Institute’s (ULI) annual commercial real estate industry forecast and speaks extensively on suburban and urban issues.
Our real estate lives have intersected for years. For example, I would get complimented for a presentation at the Waldorf Hotel (although he gave the speech) while he would get inquiries about the NYC co-op condo market (which I track).
He is the co-founder of Miller Ryan LLC, a firm that provides strategic marketing communications counsel to the financial services and real estate industries. He also writes over at GlobeSt.com on his Trend Czar blog.
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I have made it a point to attend Mark Zandi‘s economic forecast presentations over the years and had the opportunity to meet and speak with him at the Counselors of Real Estate meeting in Philadelphia a few months ago. He graciously accepted my invitation to have a conversation with me (via Skype). In 2009 Time magazine called him The Recession’s Hot Wonk. He’s got a more optimistic outlook than consensus at the moment, but he describes his optimism in its proper context during our conversation.
I first spoke to Stan Humphries, chief economist at Zillow.com last year at the Inman Conference in NYC and found him to be very engaging. Yesterday he dropped by our offices and we had a conversation on the state of the national housing market. Fun! Audio MP3AudioPlayer.embed("f-html5audio-21", {soundFile: "http://thehousinghelix.com.s3.amazonaws.com/thehousinghelix/files/2010/12/2010.12.15-The-Housing-Helix-Podcast-Stan-Humphries-Chief-Economist-Zillow.com_.mp3"});Audio MP3AudioPlayer.embed("f-html5audio-21", {soundFile: "http://thehousinghelix.com.s3.amazonaws.com/thehousinghelix/files/2010/12/2010.12.15-The-Housing-Helix-Podcast-Stan-Humphries-Chief-Economist-Zillow.com_.mp3"});if (jQuery.browser.mozilla) {tempaud=document.getElementsByTagName("audio")[0]; jQuery(tempaud).remove(); jQuery("div.audio_wrap div").show()} else jQuery("div.audio_wrap div *").remove(); Please upgrade your browser
I get to have another conversation with Rick Sharga of RealtyTrac – this time via skype. I’ve long admired his ability to articulate the state of the US foreclosure market. We touch on foreclosure mapping, robo-signing, and a sense of where we seem to be headed foreclosure-wise.
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For years I’ve watched Gary Shilling‘s media interviews on the economy and read his columns in Forbes. I ran into him recently when we were both on Bloomberg Surveillance with Tom Keene and Ken Prewitt and invited him to sit down with me and have a conversation about housing. He runs his epomonyous economic consulting firm and published a widely read newsletter called INSIGHTS.
Gary’s latest book was just released called “The Age of Deleveraging” which resides on my iPad (via Kindle app). We have an engaging discussion even though we don’t touch on his other passion, bee keeping.
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In a first for this podcast series, I have included a press call on a new product release. While I participate in media calls fairly regularly for my Matrix blog, I have never recorded one.
I spoke with Steve Berkowitz, CEO of Move, Inc., a publicly traded company, that counts Realtor.com and Move.com as two of their assets, on the launch of MortgageMatch.com today. It’s a new web site designed to help home buyers and those looking to refinance, find and prequalify for a mortgage in as little as 10 minutes. Sue Stewart, SVP who is overseeing MortgageMatch.com, provided the details of the services the site provides.
I’ve often said that the terms of the transaction (including financing) are as critical as pricing in today’s tight credit environment. They say they are focused on improving transparency in the real estate transaction and are also helping consumers and realtors to be more efficient by better defining expectations.
Real estate transactions Houston Chronicle
An affiliate of Ascension Commercial Real Estate has purchased the 136-unit Holly Apartment Homes at 1925 N. Veterans Blvd. in Eagle Pass. The community consists of 11 buildings, with units ranging from 572 to 1089 square feet.
HONG KONG-- - Colliers International announces today that it has won the highly acclaimed regional awards of Best Property Consultancy Marketing and Best Real Estate Agency Website for Asia Pacific at ...
Loan Funds Lure Investors Adding Risk in Search for Yield BusinessWeek
The debt's interest rate generally resets on a quarterly basis. Some advisers say that's an advantage if rates rise, such as in response to a pickup in inflation, although holders could be left in line with other creditors if borrowers default.
UBS Bets on Toxic Debt Demand After Fed's Record Sale: Mortgages Bloomberg
UBS AG (UBSN), which had more than $57 billion of losses and writedowns after the US real-estate crash, is betting there's enough demand for toxic commercial property assets to sell debt created at the height of the boom. The bank is seeking buyers ...
30-year mortgage rates have officially hit an all-time new low of 3.84 percent, which is below the previous record of 3.87, which occurred in February 2012, according to a statement by Freddie Mac. Frank Nothaft, Freddie Mac’s chief economist, stated that: “Signs of slowing economic growth and inflation remaining subdued allowed yields on Treasury bonds to [...] 30-Year Mortgage Rates Hit All ...
In Translation: Real Interest Rates Wall Street Journal
To determine the real rate, you need to start with the rate quoted for holdings in bank accounts, bonds and the like—it is known as the nominal rate—and then adjust it for inflation. Looking at real rates can help you determine how much your ...
Mortgage rates for a 30-year fixed loan falls to record 3.84 percent. Mortgage rates for 15-year fixed loan now stands at a new record low: 3.07 percent.
Planning on filing a real estate tax appeal? Dupage County property owners have an annual opportunity to appeal their assessments to the DuPage County Board of Review. The period during which an appeal may be filed begins on June 10th of the assessment year, and ends September 10th or thirty days after the publication of the township assessment roll, whichever is later.
An assessment appeal does not address the amount of the property tax bill, it is an attempt to prove that the assessed value overstates the property's market value, or is higher than the estimated value of similar properties.
If the property owner believes that their property is overassessed, they may file an assessment appeal. A property owner must provide evidence to support their assessment appeal. The appeal can be based on market value, or based on assessment uniformity.
The assessor will also compile sales and/or uniformity comparables to present to the Board of Review. After the appeal deadline, Board of Review hearings are scheduled. Board of Review hearings are held at the DuPage County Government Center, 421 N. County Farm Road, Wheaton.
At the hearing, the appellant is given the opportunity to explain their. The Assessor or a Deputy Assessor will respond, and present an analysis of both the Appellant's Comparables and the Assessor's Comparables.
The Board of Review may ask questions of the appellant and the Assessor. After the hearing, the Board will render a decision. The decision is mailed to the property owner after all Board of Review action is completed for the tax year.
If a property owner is not satisfied by a decision of the Board of Review, they can appeal to the Illinois Property Tax Appeal Board, or to the Circuit Court.
Citywide Services provides residential appraisal service in Chicago & suburbs. Our appraisers are Illinois State Certified and listed on the FHA Appraiser Roster. We have experience with single family homes, townhouses, condominiums as well as small residential income properties. Appraisals for conventional or FHA loans, divorce, bankruptcy, tax appeals, and estate purposes.
Appraisals fees for a typical single family home or condominium for tax appeal purposes is $275.00. Time to file an appeal is short so call Citywide Services at 1-800-405-9718 and get started.
-Central VA real estate news, trends and opinions » read more ..
Accessibility/proximity to schools and parks are two of the most common criteria my buyer clients specify when searching for homes in Charlottesville, and more often, bikeability is a factor in addition to walkability. Walkability increases property values;
Childhood obesity rates are soaring, youth participation in sports and other active pursuits is plummeting, and a generation is coming of age with little understanding of the joy and freedom of unsupervised play. There’s a simple solution—but all across the nation our schools earn a failing grade when it comes to letting kids ride their bikes.
…
The team leader for the CDC’s Healthy Community Design Initiative, Arthur Wendel, is charged with altering the design of cities and towns to improve public health. No dogmatic evangelist, he acknowledges that cycling can be hazardous; he brings up, for example, a 2002 report by the Transportation Research Board (a collaboration between the National Academy of Sciences, National Academy of Engineering, and Institute of Medicine) titled “The Relative Risks of School Travel.” This report showed that the highest number of fatalities and injuries occurring on the way to school are among teenagers who drive themselves in cars—but after that, the second most come from bicycling. Still, he contends that the takeaway message shouldn’t be that kids should neither drive nor bike. It’s “that all forms of transportation carry some risk of injury, but only a few have health benefits. Bicycling is one.”
…
Schoolwise, this might be referred to as the Maple Avenue Mind-Set: passive acceptance of a status quo that promotes not only pollution and disease but also the lesson that children (who grow up to be citizens—and parents) are helpless. Amid this grand civic failure, the chief cause for encouragement comes from individuals who refuse to give in: the Marinos, Olsons, Skenazys, and Robinsons who prioritize fresh air and exploration and exercise, the powers-that-be be damned.
My favorite line is this:
“We’re not going to back down,” Janette said, declaring that she and Adam wouldn’t stop riding “unless you tell the other parents not to drive their kids.”
This is why elections (and your vote) matter. Whoever you choose to put in the office - especially on the local levels, because it has more impact into your daily life. For example, budget for education, transportation, affordable housing, social services, economic development, library, etc., decided on the state and local levels.
The all-majority-newly elected Republican board of Loudoun county decided to put politics (read: ideology) above people's need. "The board has threatened to derail the extension of Metrorail to Dulles airport and beyond because of a requirement that the general contractor for the project negotiate a project labor agreement with local construction unions," Steven Pearsteinwrites - on something that has already been decided.
The board failed to connect many dots, among others is the impact on housing market, via Washington Post.
Certainly that has been the experience of local officials and real estate agents. Ryan Davis, for example, the city assessor in Falls Church, estimates the “Metro premium” to be somewhere between 5 percent and 7 percent for properties within one to three miles of a station. Closer than that, the premium jumps to nearly 15 percent.
Davis’s father, a real estate broker, thinks that estimate may be low. Rick Davis says he is aware of investors who bought homes a mile or two from the proposed station in Reston, expecting to capture a significant Metro premium once the station is open.
So let’s do some back-of-the-envelope calculations for Loudoun: The total assessed value of residential property on the east side of Loudoun County, in neighborhoods that are within a reasonable driving distance of the proposed Metro stations, is about $32 billion. A 5 percent increase in the value of those existing properties would translate into a $1.6 billion Metro premium. (emphasis added)
Not counting the added benefits of attracting business, talent to the county.
If the newly-elected board need to see how Metro impact housing prices, just ask any Realtor to see comparative study/analysis of say, Arlington county with Loudoun. (Arlington being the poster child of success in the region).
Do you want to change the size of your mortgage payment? It can be done in certain circumstances in a Chapter 13 bankruptcy. Declining home values in mid-Michigan have caused mortgages to depreciate or go “underwater.” That means the house is worth less than what the homeowner owes on the mortgage.
Bankruptcy judge vindicates victims of FRM Ponzi scheme Seacoastonline.com
The ruling by Judge J. Michael Deasy was in response to a bankruptcy case involving victims of the Financial Resources Mortgage company, which turned millionaires into welfare recipients, triggered two suicides, lost life savings, and sent two men to ...
Savannah bankers say commercial real estate loans available Savannah Morning News
By MARTIN SINDERMAN Finding commercial real estate mortgage money isn't as hard as it was even a couple of years ago, with many local lenders ready, willing and able to make loans. But the requirements borrowers face in actually scoring these loans are ...
Should I refinance my home to pay down credit card debt? News & Observer
His rationale was that I'd have a deductible mortgage interest at a low rate and be able to earn a higher rate of return in the market. I'm not sure I want to invest more money in the stock market, but I'm thinking his plan may make sense if I take ...
Homes.org Publishes Mortgage Rates Update - Rising Inflation and Interest Rates Albany Times Union
The Homes.org weekly mortgage rate keeps buyers and sellers updated on what's happening with mortgage interest rates across the country. The report gives in-depth details on what's affecting today's mortgages - current average rates, ...
Some answers to mortgage-related questions from readers: Q: Ruth M. asks, "My daughter, who is going through foreclosure, asked a good question: Why, when she and her husband had been required to pay for private...
Self-storage packs top low-risk real estate return San Francisco Chronicle
The best real estate investment in the past decade was found at the opposite end from trophy resorts and office towers, in 5-foot-by-5-foot lockers. Self-storage companies, which rent units to small businesses and consumers, produced the best ...
I wanted to illustrate how little of the Miami housing market today is financed with a mortgage. And despite that, sales activity is trending higher. Counter intuitive but a reflection of its two drivers of demand: investor at the lower end and cash buyers, often foreign, at the upper end.
Any thoughts on the FHA, Conventional financing cross over back in 2Q 2011?
Seacoast real estate market continues to 'bump along' Seacoastonline.com
The good news: Residential real estate had a very healthy start to 2012. The bad news: Factors such as slow job growth, student debt and foreclosures will continue to temper the rebound of the real estate market. The Seacoast Board of Realtors held a ...
Below are Washoe County’s Foreclosure Statistics through the month of March. (click on the graphic to enlarge). These statistics are provided to us by our friends at Ticor Title. All indices are down month-over-month. Notices of Default and Notices of … Continue reading →
Homeowners who had a mortgage in any stage of the foreclosure process in 2009 and 2010 and who think they may have been victims of errors or other problems in the process may be eligible for compensation, thanks to a settlement with 14 major mortgage servicers.
Brazil Real Closes Weaker As Rate Outlook Causes See-Saw Session Wall Street Journal
By Jeff Fick Of DOW JONES NEWSWIRES RIO DE JANEIRO (Dow Jones)--Brazil's real currency closed weaker in a volatile session Friday amid growing expectations for lower interest rates and caution ahead of weekend elections in Europe.
At 55M Swedish krona—roughly $8.125M by today's conversion rates—this five-bedroom house is the most expensive in the country. The 4,500-square-foot modern—which would do well as the setting of a James Bond movie—has a wine cellar, an open floorplan, and glass walls for days. Of course, it's nottheonly sleek, minimalist creation in Mother Svea, as it's jokingly referred to, but this place, which looms high over the Southern town of Helsingborg, has views of red-tiled roofs (and the ocean, of course) from its many balconies and terraces.
WARRNAMBOOL district real estate agents are cautiously optimistic that this week’s interest rate cut will offset axing of the Victorian first-home buyers grant.
Welcome to Friday Open Threads, wherein Curbed passes the mic to readers: let thy voices be heard in the comments section—and, please folks, fight fair. Have something you want discussed next week? Send it this way.
The topic of dream listings is oft discussed within the caverns of Curbed HQ—which properties or houses would be a real estate editor's dream to write about and, well, a real estate blog reader's dream to read about. Sure, there have been quite a few blockbusters to pop up within the last couple of years: the $90M Woolworth mansion in NYC, the $75M Tranquility estate near Vegas, Candy Spelling's $150M Beverly Hills mansion, and so on. But what about storied properties like Twin Palms, Frank Sinatra's Palm Springs getaway? You can rent that for a night, but it's not listed for sale. The White House was been valued at $250M and even has a page on Zillow, but obviously—well, duh. Continue the thread in the comments—anything and everything goes.
After his embarrassing, bombed-out finish at the Masters, Tiger Woods vowed to shake off sins of bogies past and pull himself together. That pursuit is still a work in progress, of course, but in the mean time he's looking to shake off sins of mistresses past, as well: his crash-pad condo in Newport Beach, Calif., is on the market. According to TMZ, this is the very place where Woods spent lots of quality time with Jamie Jungers, the Vegas lingerie model who publicly admitted that the golfer left her with nothing but a "broken heart" once their tryst came to an end.
Anyway, look past the wall-to-wall beige-blah carpeting and the three-bedroom apartment has views of the ocean and Catalina Island from multiple rooms, a patio, and a balcony. Woods bought the 2,000-square-foot unit for $3M in 2004 and seems eager to get out quick: he's listed it for $2.495M. Besides, at this point he has much better places to call home.
This week's news that the Trust for Private Land has helped the VI National Park preserve what we all know as the Maho Bay beachfront is more than welcome. But there's more to worry about.
There's a 13.8 parcel of land, adjacent, that's prime for either a luxury resort development or as many as 25 half-acre home sites.
On its blog, Islandia Real Estate said, "The National Park along with the Trust for Public Land is doing a phenomenal job preserving the island of St. John."
Nonetheless, "There remains a rare opportunity to acquire this white sandy beachfront acreage in the confines of the Virgin Islands National Park."
"This privately owned north shore beachfront property offers flexible zoning for any number of uses or a combination thereof; exclusive family estate holding, private planned residential community, ultimate upscale beachfront resort," Islandia explains on its listing.
The property has 850 feet of shoreline and a "crescent shaped beach of powdery white sand." "Well suited for luxury resort development … (or an) exclusive enclave of of luxury estates."
BOSTON (TheStreet) -- Today's record-low mortgage rates are giving consumers the choice of two great options -- 30-year mortgages that charge just over 4% interest or 15-year loans with rates nearly down to 3%. "You really can't go wrong," says Greg McBride, senior financial analyst at interest-rate tracker Bankrate.com "Rates are at record lows on both products." Thirty-year or 15-year mortgage ...
Craig Hudson, 40, Lynne Hudson, 35, and Eric Rivero, 39, all residents of Tampa, Florida, pleaded guilty to racketeering and conspiracy to commit racketeering for mortgage fraud related crimes.
Jed Kolko, Trulia’s Chief Economist on the sales market:
“Housing prices have already bottomed with asking prices on the rise for three straight months. Aside from a stumble in December, asking prices have been stable or rising for the last eight months,” said Jed Kolko, Trulia’s Chief Economist. “Prices have joined the recovery, alongside sales and construction. But foreclosures threaten prices, especially in judicial-foreclosure states like Florida, New Jersey, Illinois and New York, where many more distressed sales are still to come.”
on rental market:
“Rents have steadily increased as people who lost their homes in the crash became renters. At the same time, high unemployment and tight credit sidelined would-be homeowners,” said Jed Kolko, Trulia’s Chief Economist. “But relief for strapped renters may be in sight. Construction of multi-family buildings revved up last year. These new rental units will come to market later this year, giving renters more choices and less fierce competition.”
Asking prices up 1.9% quarter-over-quarter, seasonally adjusted.
Asking prices up 0.5% month-over-month, seasonally adjusted. This is the third straight month of month-over-month increases.
Asking prices up 0.2% year-over-year, the first year-over-year increase in the price index.
Asking prices up quarter-over-quarter in 92 of the 100 largest metros.
The Trulia Rent Monitor for April 2012 shows:
Rents up 5.6% year-over-year.
New York Metro - you can see how much faster the rental market is rising over the sales market. In fact more than half of the NYC metro area are showing declining price trends.
The Trulia Price and Rent Monitors rely on the latest asking price or rent rather than the original to better track the direction of the market. Prices on MOM, QOQ and YOY on based on a 3 month moving average. Here’s the nitty gritty. Love the “technical” and “non-technical” FAQ notes detailing how it works.
Note: I have been on the Trulia Industry Advisory Board since its inception in 2006.
Trulia Price Monitor Is Launched: New (Better) Way To Look At Housing Price Trends [Matrix]
Rising Home Prices: Coming to a Market Near You [Trulia]
Trulia Price and Rent Monitors – April 2012 [Trulia]
Tierney blasts housing official Chicago Tribune
"I was upside down very quickly; I had no equity, I couldn't refinance and I had these crazy interest rates," he said, noting the rate on his adjustable rate mortgage jumped from 5 percent to 9 percent. "My parents are from the Dominican Republic and ...
According to latest figures by Freddie Mac, the average rate for 30-year fixed mortgages declined to 3.84 percent for the week ending 3 May, from 3.88 percent last week and 4.71 percent a year ago.
Mortgage rates for 30-year fixed U.S. loans fell to a record low, reducing borrowing costs as concerns about the U.S. economic recovery and euro-region unemployment drove investors to the safety of government bonds. The...
RATES DROP: Average rates for 30-year and 15-year fixed-rate mortgages and one-year adjustable rate mortgages hit fresh lows this week, according to a survey by mortgage buyer Freddie Mac.RECORD LOWS: ...
Man of the moment Lenny Kravitz—see chairs for Kartell, fancy condo building in Miami—has debuted some tiles with the Italian firm LEA Ceramiche. According to Freshome, the rocker and decorator was inspired by "moving water" for the Goccia Three Dimensional Tile Collection; check out two other styles below.
Greater Toronto Realtors reported 10,350 transactions through the TorontoMLS System in April 2012. This level of sales was 18 per cent higher than the 8,778 firm deals reported in April 2011. The strongest sales growth was reported in the single-detached market segment, with transactions of this home type up by 22%compared to a year ago.
“Interest in single-detached homes has been very high, both in the City of Toronto and surrounding regions. Growth in single-detached listings has not kept up with demand, which means competition between buyers in this market segment increased. With this in mind, it was no surprise that the strongest annual price increase was also experienced in the single-detached segment,” said Toronto Real Estate Board President, Richard Silver.
The average price for April 2012 transactions was $517,556 – up 8.5 per cent compared to April 2011. While price growth was strongest for single-detached homes, the better-supplied condominium apartment segment experienced a more moderate annual rate of price growth, at four per cent.
“Monthly mortgage payments remain affordable for home buyers in the Greater Toronto Area. While interest rates are generally expected to increase over the next two years, the extent and timing of rate hikes has been thrown into question by slower than expected economic growth in the first quarter of this year. On net, borrowing costs are expected to remain a positive factor influencing home sales through 2012,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.
Thirty-year fixed-interest mortgage rates continued to slide this week, falling to 3.84 percent from 3.88 percent last week, Freddie Mac reported Thursday. The 15-year rate was 3.07 percent, down from 3.12 percent last week.
Good news or bad news? Depends, perhaps, on what you do with it. Freddie Mac’s weekly survey of mortgage interest rates today reveals the rate on the 30-year fixed mortgage has hit a new low: 3.84% for the week ending May 3, down from 3.88% last week and 4.71% a year ago. As a matter of fact, all the rates surveyed hit new lows.
CoreLogic released its National Foreclosure Report for March, which provides monthly data on completed foreclosures, foreclosure inventory and 90+ day delinquency rates.
Through the first quarter of 2012, there were 198,000 completed foreclosures compared to 232,000 through the first quarter of 2011.
Since the start of the financial crisis in September 2008, there have been approximately 3.5 million completed foreclosures.
Several housing experts are predicting that this year will be the last chance for homebuyers to cash in on the weak housing market.
According to Money Magazine buying a home may never get any cheaper than this. Several housing experts are predicting that this year will be the last chance for bargain hunters to cash in on the best deals of the weak housing market.
With home prices down 34% nationally since 2006 and mortgage rates at historic lows, homes have never been more affordable -- but it won't stay this way for much longer.
Stuart Hoffman, chief economist for PNC Financial Services (PNC, Fortune 500), said he expects home prices to flatten out by the third quarter and start climbing by next year.
A number of factors will help bolster the housing market, he said, including a decline in the number of foreclosures and continued job growth. In addition, homebuyers will have better access to mortgages as they get their finances in order and improve their credit scores.
Some economists, like Trulia's Jed Kolko, expect home prices to pick up even more quickly. Trulia's data shows that the national average for asking prices already increased 1.4% in the first quarter of 2012, compared with the last three months of 2011.
James Delbert McConville, 61, Fremont, California, was sentenced to 93 months in prison, and ordered to pay more than $7 million in restitution for conspiring to commit mail and wire fraud related to approximately 80 fraudulent loan applications secured by real property in Escondido and San Marcos, California.
Inland Real Estate Corporation Reports First Quarter 2012 Results MarketWatch (press release)
OAK BROOK, Ill., May 03, 2012 (BUSINESS WIRE) -- Inland Real Estate Corporation (NYSE:IRC) today announced financial and operational results for the three months ended March 31, 2012. -- Funds From Operations (FFO) per common share was $0.20 for the ...
Mortgage rates reached new lows this week, as they continue to attract an increasing number of homebuyers and give existing homeowners a chance to reduce their mortgage payments. But that's not enough to fix the housing market, analysts say.
NEW YORK, May 3, 2012 /PRNewswire/ -- Mortgage rates fell for a fourth consecutive week and the fifth time in the past six weeks, with the average rate on the benchmark 30-year fixed mortgage rate dropping ...
Ifeanyichukwu Eric Abakporo and Latanya Pierce have been arrested and charged for allegedly swindling an elderly woman out of her multi-million-dollar property in Harlem, New York, that she had owned for more than 40 years, and then deceiving a bank into giving them a $1.8 million mortgage loan secured by the property.
Claymon "Butch" Trammell, 62, along with his wife and daughter, all of Houston, Texas, have been sentenced to federal prison for their respective roles in a multi-million dollar mortgage fraud scheme.
Photo via Curbed Hamptons: A shingle-style home in East Hampton, N.Y., asks $6.2M.
THE INTERNET—Some news from the guys at Zillow today: the Zillow Real Estate app won for "Best Mobile App, Utilities & Services" in the 16th annual Webby Awards. In other events, Zillow has plans to buy RentJuice, the San Francisco-based rental relationship management software for landlords, property managers and rental brokers, for $40M. [Zillow]
NYC—Could there finally be some good news for everyone's favorite decorating doyenne? Martha Stewart Living Omnimedia posted a first-quarter net loss of $3.6M—down from the $7.1M it netted in losses in Q1 of last year. [Home Furnishings News]
DETROIT—The famously wealthy Scripps family gave Detroit The Detroit News and helped found the Detroit Institute of Arts. Now one of the family's grand, old homes has been listed for $195K. Built in 1916, the six-bedroom mansion measures 12,000 square feet. [Curbed Detroit]
Brazil's Real Weakens Amid Speculation On Rate Cuts Wall Street Journal
By Matthew Cowley Of DOW JONES NEWSWIRES SAO PAULO (Dow Jones)--Brazil's real weakened sharply on Wednesday as investors speculated about the possibility of more interest rate cuts and concerns about economic growth. The day was rife with rumors that ...
This is a guest blog contributed by Ben Fisher, a Park City REALTOR® serving the Park City & Deer Valley Luxury communities. I know many real estate agents all over the country use Gmail for their primary email service, but most do not fully...
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Interest Rate Forecast 2012-2013 Forbes
The first half of the interest rate forecast is very simple: short-term interest rates will remain in microscopic territory through 2013. Less certain is the outlook for long-term interest rates, most likely a story of rising yields.
The average rate for a 30 year fixed rate mortgage went unchanged at 3.92 percent since last week, while the purchase application volume increased 2.9 percent and the refinance application declined 0.7 percent over the same period.
-Central VA real estate news, trends and opinions » read more ..
The housing recovery in Charlottesville (and presumably everywhere, but knowing this market is hard enough) is kind of like pornography.
I shall not today attempt further to define the kinds of material I understand to be embraced within that shorthand description ["hard-core pornography"]; and perhaps I could never succeed in intelligibly doing so. But I know it when I see it, and the motion picture involved in this case is not that. [Emphasis added.]
How will the “recovery” be defined? Is now the time to buy? (or sell?)
First, we’ll know by hindsight. When we have the luxury and the benefit of 12 to 24 months of looking back, we’ll be able to tell.
Transactions – volume of transactions – what is normal volume of sales transactions in the Charlottesville MSA? I don’t know; homeownership rates are declining. Last year, 1755 single family homes sold in the Charlottesville MSA (including Louisa). In 2002, 2479 single family homes sold. I’d put the “sustainable” rate of single family home sales somewhere in between those two numbers.
Price – stability or appreciation showing themselves
Foreclosures and short sales – fewer than today to none.
Shadow inventory – known and dispensed with; no longer a question of uncertainty.
So … is the housing market in Charlottesville recovering?
The debate is now about the strength of the recovery, not whether there is a recovery. My view is housing will remain sluggish for some time, and I expect 2012 to be another historically weak year, but better than 2011.
Maybe.
Consider this snapshot, from which I’m trying to :
In Charlottesville and Albemarle:
- 107 homes went under contract between 15 April and 1 May 2011. 64 of those were single family. 23 were attached.
- 144 homes went under contract between 15 April and 1 May 2012 – a 26% increase! – 92 (30% more) were single family. 23 were attached.
In the Charlottesville MSA (Charlottesville, Albemarle, Fluvanna, Greene, Louisa, Nelson):
- 156 homes went under contract between 15 April and 1 May 2011. 109 (70%) were single family.
- 186 homes went under contract between 15 April and 1 May 2012. 132 (71%) of those were single family.
That sure looks like we’re on the path to recovery, right?
In the MSA in the above timeframe, 22 of those contracts in 2011 were either short sales or foreclosures (6 & 16, respectively). In 2012, 19 of those were short sales or foreclosures (8 & 11, respectively). “A 14% decline in distressed contracts!” surely is a better headline than “3“, right?
It’s too early to tell with respect to foreclosures/short sales/distressed sales
That’s why prospective buyers should stop focusing on the vague hope that house prices will jump from here and focus instead on the functional value houses provide for the money. In most markets, they provide enough of that to make buying a good deal.
It’s time to share my Three Cents Worth on Curbed NY, at the intersection of neighborhood and real estate in the capitol of the world. And I’m simply here to take measurements.
Since we are in some sort of rent versus buy gray zone right now, I thought I’d create a “gray” matrix showing the market share differences in location and apartment size based on the buy and rental market in Manhattan. This is not a rent versus buy analysis but rather a comparison between two distinctly different markets…
In a released statement, state lawmakers announced that House Bill 1875 HD2 SD2 CD1, which amends the mortgage foreclosure law to provide additional protections for Hawaii’s homeowners, passed its final floor vote Tuesday before the full House and Senate.
Please meet a growing trend for the nation's foreclosures (and no, it's not just turning them into rentals): teenagers throwing ragers in them and getting arrested. Says one property manager after the fact: "The house was trashed. Vomit, cigarette butts, bottles everywhere. I no longer list homes as 'vacant' because they just googled vacant homes, and they found it." [10 News via Gawker]
MEQUON, WI-- - Mortgage Marvel Rate Trends™, a daily survey of more than 1,000 lenders, shows conforming, 30-year, fixed rates fell in April, closing out the month at 3.96 percent. Late in the month, the ...
Chasing Rates: The Truth Behind Interest Forbes
Consumers have been programmed to focus on this single aspect of selecting a mortgage lender, even though interest rates are only one component of the overall price of a mortgage. Most assume that hearing the lowest rate quoted means getting the best ...
Stacey Petro, also known as Stacey Moises, 37, Branford, Connecticut, was sentenced by Senior United States District Judge Alfred V. Covello to 41 months of imprisonment, followed by two years of supervised release for her role in a southeastern Connecticut mortgage fraud scheme.
Who: All CitiMortgage homeowner clients having difficulty making mortgage payments and needing assistance What: Citi® Road To Recovery Ohio Homeowner Assistance Events Details: Cincinnati Tuesday, May 8, 2012 12:00 noon– 7:00 PM Millennium Hotel Cincinnati 150 West Fifth Street Cincinnati, OH 45020 Columbus Thursday, May 10 12:00 noon – 7:00 PM Sheraton Columbus Hotel 75 East ...
JACKSONVILLE, Fla., May 2, 2012 /PRNewswire/ -- The March Mortgage Monitor report released by Lender Processing Services, Inc. (LPS) shows that while March foreclosure starts increased a modest 8.1 percent ...
I talked to an agent recently who was working with an SEO expert who advised him to target long-tail keywords. I have no problem with long-tail keyword phrases, and they do play an important role in SEO. But, please. An SEO...
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Steven J. Cox, Mobile, Alabama, a real estate investor, has agreed to plead guilty and to serve one year in prison for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in southern Alabama.
Southampton – It comes as absolutely no surprise that the cost to live in the lap of luxury in the Hamptons has once again risen. With the release of the quarterly market reports last week real estate firms are touting that all signs point to a stable market.
Overall home sales are up about 32% in the Hamptons. “It is encouraging to see an increase in the number of sales in the Hamptons. It reflects the improving level of activity we are currently experiencing,” said Peter Turino, President of Brown Harris Stevens of the Hamptons. “It’s important to remember that in the first quarter of 2011, sales were weaker than normal as the pending expiration of the Bush tax cuts led many high-end owners to sell in 2010.”
Talking luxury homes, Jonathan Miller, president of Miller Samuel who compiled the report for Prudential Douglas Elliman, showed that the high-end of the Hamptons real estate market saw an increase in the median home price of 3.8% or $4,775,000, up from $4,600,000 this time last year. The high-end of the spectrum in East Hampton got a little help from the sale of a very hot property with at $20,000,000 price tag in the first quarter.
Associate Broker Phalen Wolf of Brown Harris Stevens notes that, “the market continues to slowly stretch like taffy pulled from both ends, with the high-end edging up, and the low-end creeping down.” Across the board sales are taking longer on average and inventory is down from last year pointing to sellers taking their time getting into the market and then staying firm on price.
Sales are up, prices are up, and mortgage rates are down. Overall, it looks like people are deciding not to negotiate, hope that doesn’t spell disaster for summer traffic with all the merging that occurs on the South Fork.
If you live in New York and happen to have about $625 in your pocket, you could go out and buy yourself a plane ticket to Los Angeles, a 32-gigabyte iPad, or perhaps a shiny pair of Christian Louboutin pumps. Or you could make that your monthly rent in a city apartment, by sticking with Sophia Cosmadopoulos.
Ms. Cosmadopoulos works not in real estate, but in the field of art therapy and instruction, and she has plenty of student loans to pay. So to make ends meet in this city, she has worked odd jobs, eaten many $1 tacos and chased low rents around Brooklyn, keeping that expense consistently hovering around $625 per month, give or take a few tacos.
While her budget has remained constant, rents in that borough have emphatically not. Following Ms. Cosmadopoulos’s path — from the edge of the Brooklyn-Queens Expressway in Carroll Gardens, to Williamsburg, then Bushwick, and finally to Bedford-Stuyvesant — creates a rough map of rising rents across parts of Brooklyn.
“They’re not glossy, and they’re kind of falling apart,” Ms. Cosmadopoulos said of her various apartments, as she sat sipping tea at her narrow kitchen table. She also has been forced to forgo the luxury of living by herself. “But I’ve always valued what I could get out of New York, more than where I lived.”
There are still areas outside Manhattan where a $625 apartment or share can be found, but those pockets have moved farther and farther inland. And in Manhattan, that particular price tag is all but gone. A search on Craigslist last week for a $625 maximum rental in Manhattan turned up just one lonely little listing, for a single room in Harlem. No smokers, please.
“I think if you go back to 1992, give or take, that’s the last time you could potentially find something in that price range” in Manhattan, said Gary L. Malin, the president of Citi Habitats. (In 1992, Ms. Cosmadopoulos turned 7.) Today, Mr. Malin said, “the cheapest thing in Manhattan that’s shareable is $1,050 to $1,100 per person, and we’re talking about a tiny walk-up.”
Many young people, of course, are thrilled to take the stairs or sleep stuffed in a crawl space so they can afford to live in New York. And Ms. Cosmadopoulos readily admits that while all of her apartments have had pleasant, old-fashioned qualities, they have also had drawbacks. One was a sixth-floor walk-up, another a four-bedroom railroad flat, two had many-legged visitors, including lots of water bugs and one rat, and all were in a general state of decay.
In her current apartment, for example, which has hammered tin ceilings and decorative fireplaces, a chunk of the bathroom ceiling came down recently, leaving a hole the size of a small pizza box above the toilet. While she and her roommate were examining their new air vent, they found a stash of pages torn from 1970s pornographic magazines.
“It’s nice to live in an apartment where you have stories,” she said with a giggle.
Her rent is $650 per month.
Jonathan Miller, president of the Miller Samuel appraisal firm, said the last time he had paid a similar amount was in a western suburb of Chicago in 1984, and at the time, he said, he thought his one-bedroom apartment was fabulous. Twenty years later, however, he drove by to take a peek at it with fresh eyes.
“I looked,” Mr. Miller said. “And I thought: ‘Oh. What a dump.’ ”
Ms. Cosmadopoulos, who says her childhood in San Francisco prepared her for New York’s real estate madness, might already use the same word to describe her first place in Brooklyn: a three-bedroom basement apartment by the B.Q.E., a 12-minute walk from the Carroll Street stop on the F train.
“We would literally find like three water bugs a day,” she said. “That was not ideal.”
Her portion of the rent was $550 a month, but she and her two roommates decided that even that was too much, she said. They broke the lease, and she moved into a two-bedroom, sixth-floor walk-up in Williamsburg, near the Lorimer Street stop on the L train, where she paid $675.
“That was when I was being a little social butterfly and wanted to be near everything,” she said. “I was paying for the neighborhood, not the apartment. But it was still only $675, which for Williamsburg, now, you can’t really find.”
By mid-2009, when the lease expired, rising prices and occasional vermin had prompted Ms. Cosmadopoulos to decamp farther east on the L line, to the Morgan Avenue stop in Bushwick. There, she lived with perhaps the worst of all possible floor plans, she said, in a four-bedroom railroad apartment. This did not last long. When the downstairs neighbors got bedbugs, Ms. Cosmadopoulos left, after only two months.
Next, she chose a less-hip subway line, near the Myrtle Avenue stop on the J train. That apartment, which was on Suydam Street, had been meticulously restored — it was rumored to have spent many years as a crack den, she explained — but the layout was a bit awkward. Her rent was only $575, and after two years of unannounced visits from the landlord, who was endlessly concerned about the state of the floors and ceiling lamps, she decided to move on.
In October, Ms. Cosmadopoulos moved to her current apartment on a tree-lined block in Bedford-Stuyvesant, near the Kingston-Throop stop on the C line, providing an easy commute to her job as an art studio coordinator at Pure Vision Arts in Manhattan. She works with adults who have developmental disabilities.
While she says she prefers her new neighborhood to living in Bushwick, which can feel very desolate and dark, parts of Bedford-Stuyvesant do struggle with violence and crime, and there was a shooting on her block two weeks after she moved in. But after a few shaky days, she said, she put it behind her.
An issue she spends more time thinking about, she says, is her participation in waves of gentrification.
“It’s hard to avoid when you move to New York, when you have a bunch of student loans and don’t have a lot of money,” she said. “I just live in places that I can afford to live. And obviously, that comes at a price.”
Ms. Cosmadopoulos said that in every neighborhood where she lived, she had made sure to shop at nearby businesses, to support the local community and never to pine for a place like Starbucks.
Andrew Hill, 34, Dublin, Ohio, was sentenced in U.S. District Court to 24 months in prison for obtaining more than $1.2 million in fraudulent mortgage loans involving investment properties in Portsmouth, Ohio then "flipping" the properties and selling them to unqualified buyers.
Mortgage holders are being kept waiting by the big banks on interest rate relief after the lenders failed to immediately pass on an emergency-sized cut in official interest rates by the Reserve Bank yesterday.
Local real estate developer files for bankruptcy Indianapolis Business Journal
A prominent Indianapolis developer is seeking to liquidate $11 million in personal debt he attributes to the prolonged slump in the real estate market. Cornelius M. Alig, chairman and CEO of Mansur Real Estate Services Inc., filed for Chapter 7 ...
In a state with very few multimillion-dollar homes, this listing surely stands out, not only for its price tag ($1.875M) but also for its size (6,600 square feet) and list of extravagances (including a theater, game room, sports bar, chef's kitchen, and gym). The five-bathroom home, located in the misleadingly named Grand Island, Neb.—not actually an island at all, of course, but a city some 90 miles due west of Lincoln—was built in 1998 and was put up for sale for the first time two months ago. Whoever he or she is, the next owner will have to be willing to be the richest person around—this place is far more expensive any other property on the market in town. Said individual will also need to possess strong, guiding affinity for dark wood in every possible form, from ceiling beams and wall paneling to kitchen cabinetry and floors. After all, according to the brokerbabble, "Nearly all furniture, household items, kitchen ware, bar ware, decorative items, game machines, pool table, theatre room seating & components, televisions, outdoor furniture, pontoon boat & so much more stays with the home."
We are thrilled to announce that Dean Ouellette is taking the position of Vice President of Business Development at Thompson’s Realty effective immediately.
Dean has been with Thompson’s Realty for over two years, and is an outstanding real estate agent. His passion for teaching and helping agents is known by many and fits perfectly in this new role.
As Vice President of Business Development, Dean is chartered with growing the brokerage by bringing in new agents and working closely with existing agents to help them continue to develop and refine their business. As an instructor, consultant, short sale expert, technology aficionado, and one of the most dedicated and hardest working people I’ve ever known, there is no question that Dean will be successful in this role.
Here’s Dean in his own words on this new position:
Thompson’s Realty is truly one of the most unique brokerages in the country. I am glad to be working with them to continue their growth. We look forward to making Thompson’s a home for any agent looking to grow their business and provide excellent service to our clients. After all, that is what Thompson’s has always been about; providing a quality service that will make our clients want to come back for all their real estate needs and refer us to all their friends and family members.
We are excited to have Dean in this new role, and excited for the future of Thompson’s Realty!
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
Nadin Samnang, 29, Ashburn, Virginia, has been convicted by a federal jury for his role in fraudulent mortgage loan transactions involving at least 25 homes in Northern Virginia and more than $7 million in losses to lenders.
While this resort-like contemporary remains on the market for the time being, Curbed LA has received word that the 13,500-square-foot mansion has sold, for $15M, to none other than Hollywood A-lister Matt Damon. Sited on more than half an acre and surrounded by lush landscaping, this sprawling Grant Kirkpatrick-designed estate offers just the sort of privacy a silver screen star desires. Built in 2004, the main house includes seven bedrooms, ten bathrooms, 35-foot ceilings lined with mahogany, swimming pool with flagstone patio, a five car garage, a "serious gym," and two maids rooms. If there is a downside to the place, it's that it feels a little too much like a hotel and, judging from the listing photos, lacks any view of the Pacific.
· Check Out Matt Damon's Possible New Pad in the Palisades [Curbed LA]
Long-tail keyword phrases do help you get very targeted traffic. Someone searching for Atlanta real estate could want anything, residential, commercial, rentals, etc. Someone searching for 2 story homes in historic Atlanta neighborhoods is...
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DUBLIN, May 1 (Reuters) - Irish lender permanent tsb (PTSB) is to cut its residential mortgage rates by half apercentage point for 74,500 variable rate customers, moving itsrates closer to those of domestic ...
One in seven home owners struggles to pay the mortgage and 20pc would not have enough for essentials such as food if their repayments rose by £100 a month.
CARLSBAD, CA-- - The Mortgage Guide was established in response to the widespread need for assistance in getting approved for the new loan modification government funds whose purpose is to help homeowners ...
Troy Allen Huston, 42, and Chad Arthur Anderson, 38, both of Chisago City, Minnesota, two mortgage loan officers, have been charged with recruiting straw buyers to purchase properties at inflated prices and then distributing the excess loan funds among the buyers and between themselves in the form of "kickbacks."
Tonii Carlos Greene, 52, Eagan, Minnesota, has been indicted for participating in a $3 million mortgage fraud scheme premised on the purchase of rundown houses to be rehabilitated and then sold. Instead, however, the equity was stripped from the homes, and the lenders were defrauded.
Mortgage rates are at historic lows, rents are sky high and prices are relatively low.
Time to rush out and buy your first home, correct? Maybe, but take your time and do it right.
“The key word is: Cautious,” said Robert Ferri, a broker with Citi Habitats.
If you are thinking about becoming a first-time homebuyer, you’re in good company.
In the first quarter of the year, there was a surge in sales of starter apartments in Manhattan. They accounted for more than half of all closed sale transactions, according to a report from Prudential Douglas Elliman.
“For homebuyers in New York City, given where prices are, if they are comfortable and can see themselves staying in that property for a number of years, then I think it is a very good time to buy,” said Malcolm Hollensteiner, director of retail lending sales for TD Bank.
“Prices have been fairly stable for the last few years. At some point they will go up.”
Even so, home buying has changed drastically in the wake of the financial crisis.
Banks are far more cautious about lending. And buyers who have witnessed the mistakes of their peers are proceeding with more care.
Here are some of the things you need to know before you turn the key on becoming a buyer.
Getting a mortgage is tough. “There are definitely more people buying today than there were two years ago,” said Melissa Cohn, president of The Manhattan Mortgage Co.
“But there are many people who don’t qualify who have to stick to renting.”
While in the past buyers could put down little to no money, banks now require a down payment of least 10% to 20%. The exceptions are FHA loans which require a down payment of just 3.5%.
“Not only do you have to have the money for the down payment, but you also need post-closing reserves,” Cohn said.
“For conforming loans up to $417,000, it is as little as three months of carrying costs. For jumbo loans, it could be as much as 30% of the loan amount.”
Income and credit scores are key. The days of no income verification are history. Expect to see tough requirements for credit scores, too. “Banks have become very credit conscious,” Cohn said. “Three years ago, people with poor scores got financing. “Today, that is not case. Most banks want credit scores of at least 700.”
Understand what you can afford. Banks will be looking at your debt-to-income ratio, what percentage of your monthly gross income is allocated for housing, and other monthly obligations.
“Typically, we use up to 41%,” Hollensteiner said. “A few years ago, it was very common for borrowers to qualify with a 55% debt-to-income ratio.”
When figuring out what you can afford, think about additional expenses you have and whether you can handle them after taking on a mortgage. Ferri asks his clients to think about how much they are willing to sacrifice in exchange for home ownership.
“Before, people bought $1 million homes and thought they could still go to Europe, and found out they couldn’t,” he said.
Get educated about the home buying process. You’ll need to learn about neighborhoods, property types and how to shop for the right mortgage.
Fortunately, there are plenty of free resources.
Nonprofit groups like Neighborhood Housing Services of New York City offer free homebuyer’s orientation seminars (nhsnyc.org). Other housing counselors certified by U.S. Department of Housing and Urban Development can be found at hud.gov.
You can also go to the New York City Department of Housing Preservation and Development’s website (nyc.gov/hpd) and visit the Homebuyers section for helpful information and resources.
“Decide what kind of home you want and determine your overall needs,” advised Bernell Grier, Neighborhood Housing Services of New York City’s CEO.
“Go to a HUD-certified housing counselor and sign up for classes. Take your time and ask questions.”
Gary L. Malin, the president of Citi Habitats, the city’s largest rental brokerage firm, does not surprise easily when it comes to the region’s real estate market.
But when Malin’s company was preparing its latest analysis of the rental market, he was taken aback. In March, the firm found, the average rent in Manhattan — at $3,418 a month — surpassed the all-time high set during the real estate frenzy of 2007.
“Right now, landlords can go for pie in the sky — why not?” Malin said.
The last time rents shot up in a similar fashion, they were tied to a strong economy, low unemployment and booming business on Wall Street.
This spring, however, Manhattan rental prices seem to be divorced from the larger economic picture. While the city has added jobs in recent months, especially at technology companies, much of country is still struggling.
The uncoupling of the national economy from New York’s is not typical, said Jonathan J. Miller, the president of the appraisal firm Miller Samuel.
“When you see rents rising, it is usually reflective of a strong economy,” Miller said. “That is not the case now.”
Instead, he said, prices are being driven up by a tight credit market that forces people to stay in the rental market and, at the same time, limits new construction.
That disconnect, however, has only increased resentment levels among many tenants. Still, many have nowhere to go if they choose to live in Manhattan, where the vacancy rate for apartments is about 1 percent.
“I felt trapped,” said Jaclyn Barrocas, who was recently hit with a big rent increase on her East Side apartment. “It was too expensive to move and too expensive to stay.”
There is some evidence that rising rents are driving prospective renters to buy. But for those who determine that buying a home in New York City is not an option, the choices are limited and often unappealing.
As a result, there has also been a surge of interest in the other boroughs, with many neighborhoods reporting record rents of their own.
In Southwest Florida, rents have also risen in the past year, in part because an abundance of home foreclosures has pushed new renters into the market.
Though rental prices range widely here — some waterfront or beachfront vacation places in winter fetch as much per week as Manhattan apartments get per month — there has not been a surge in prices partly because there are now so many rentals available, the result of wave after wave of purchases of foreclosed homes by investors.
Back in New York, the problem is unlikely to abate anytime soon. That is because just 2,229 rental apartments are scheduled to be added to the market this year in Manhattan, a 30 percent drop from the average number over the last seven years.
That low vacancy has pushed Manhattan rents up markedly. Rates for one-bedroom apartments have risen the most, to $2,747 a month, a 6.5 percent jump over the past year, according to Citi Habitats.
Three-bedroom unit prices rose 4 percent, to $5,107 per month.
Some renters have battled back against increases by moving to even pricier quarters. Joseph Rosati, 25, and two friends did that when their rent was slated to go from $3,700 a month to $4,300 a month. They found a two-bedroom apartment with an office at 37 Wall St. for $5,400. Although they are paying more, they are satisfied.
“I did not move to New York City to live in Hoboken or Jersey City,” Rosati said.
What could halt rising rents — besides more apartments to choose from? In 2008, it took the nation’s financial meltdown to calm rent hikes. Then, big landlords began offering incentives like two months’ free rent on a one-year lease. Those incentives lingered until 2010.
One solution to spiralling rents, of course, is to leave the borough entirely.
Kimberly Kreuzberger and her husband, Bryan, both 32, loved their loft studio at 666 Greenwich St., which cost $3,200 a month. But when the rent was slated to bump up to $3,795, after three years, they balked.
The couple settled on a two-bedroom apartment in Brooklyn. They paid just over $1 million, putting 25 percent down. Their monthly outlay is $4,250.
“It was such a leap,” she said. “But we could not be happier.”
Nearly six years after home prices started falling, more U.S. housing markets appear to be nearing a new phase: a prolonged bottom.
Hitting a bottom, of course, isn’t the same as a full-fledged recovery, which is still years off for many housing markets—as well as for millions of people who purchased homes or took cash out during the bubble.
The good news is that housing construction and home sales appear to have hit a floor. Home builders cut back heavily in the past four years and began construction on just 434,000 single-family homes last year, the lowest level on record. Research firm Zelman & Associates estimates builders will start construction on 540,000 homes this year, a 24% increase.
New-home sales during the first quarter posted double-digit gains from the previous-year period. A rebound here is likely simply because “we’ve starved the market for new-home construction,” said Ivy Zelman, the firm’s chief executive.
Sales of previously owned homes, meanwhile, are up 32% from their low point of mid-2010, when sales plunged following the expiration of home-buyer tax credits.
That leaves prices as the last measure that hasn’t yet stopped falling. But there are signs of progress on that front, too, as the pace of declines is slowing.
In February, home prices fell by 2% from their level of a year earlier, according to CoreLogic Inc., a real-estate-data firm. But after excluding foreclosures and other distressed sales, prices were down by just 0.8%, the smallest year-over-year decline since May 2010.
“If you remove the distress, you’re looking at housing prices not falling much further,” said Jonathan Miller, president of Miller Samuel Inc., a New York-based appraisal firm.
The problem, of course, is that foreclosures are still a very high share of sales in many of the hardest-hit markets.
One of the biggest headwinds today is the “shadow inventory” of potential foreclosures. Banks owned about 450,000 properties at the end of March, but there were an additional two million loans in some stage of foreclosure and around 1.7 million more where mortgage payments hadn’t been made in more than 90 days.
Housing economists are debating whether that shadow inventory will spoil any housing recovery. “That’ll be like a ball and chain,” said Mark Fleming, chief economist at CoreLogic. “It won’t prevent a recovery, but it could drag it out over several years.”
Housing is getting a lift from reduced supply and stronger demand. Mortgage-interest rates at near-record lows and prices at their 2002 levels have made homes more affordable than at any point in the past decade. The number of homes for sale has fallen over the past year. A top complaint of some real-estate agents today is that there aren’t enough homes to show potential buyers.
Ms. Zelman, who was among the first to warn that the air had begun seeping out of the housing bubble six years ago, said the shadow inventory is “not going to result in the double dip that people always talk about.” She points to a burgeoning appetite for housing from investors, who are scooping up homes that can be converted to rentals, and six years of pent-up demand from traditional buyers who feel better about their financial prospects. “The fear is gone,” she said.
While the foreclosure overhang is serious, some economists say there is a less-noticed tailwind that could balance things out: the sharp decline in new construction over the past four years. “A lot of the people who talk about ‘shadow inventory’ don’t talk about how slow the overall housing stock has been growing,” said Thomas Lawler, an independent housing economist in Leesburg, Va.
There’s more that will keep home prices from rising, once they do hit bottom. First, many Americans don’t have the required down payment or can’t qualify for a mortgage. Banks are making borrowers jump through more hoops in order to produce loans that can’t be subjected to a costly “buy-back” demand from Fannie Mae, Freddie Mac or other investors if the loan defaults. That is keeping credit very tight.
More than one-third of all homeowners have less than 25% equity, including 15% that are underwater, meaning their homes are worth less than what they owe.
Second, inventory declines may be less of a sign of health than they would suggest and instead reflect one of the structural problems holding back housing: Sellers are frozen, either unwilling or unable to sell at current values. Markets above the entry level, where demand from investors and first-time buyers isn’t as strong, face a particularly steep climb because of that equity hole.
“Nobody’s voluntarily putting their home up for sale,” said John Burns, a home-builder consultant based in Irvine, Calif.
For-sale inventories may also be lean because banks sharply decelerated the foreclosure process over the past 18 months after courts found that they were routinely passing off forged paperwork to take back homes. If prices are stabilizing because of that temporary drop in foreclosures, some recent gains will prove artificial. Ultimately, because that shadow inventory is concentrated in certain markets, price drops also will be concentrated there.
Markets that are more quickly absorbing the stock of foreclosures amid an improving economy, such as Phoenix, and in those where the overhang wasn’t as severe, such as Denver and Washington, D.C., have probably hit bottom. Others face a longer haul, particularly in overbuilt cities such as Atlanta and Las Vegas.
Many cities in Florida and the Northeast, where banks have been unable to satisfy court-administered foreclosure processes, have a glut of foreclosures that has yet to be digested.
A housing “recovery” has already had false starts. Two years ago, government stimulus gave a short-lived boost, and today, cheap mortgages and foreclosure delays could be doing the same.
There is plenty that can still go wrong—especially a sudden rise in mortgages rates or slowdown in job growth—and a lot that needs to go right for housing to recover. But there are more signs than there were a year ago that housing isn’t getting worse, and that it may slowly be getting better.
Long Island City’s coming of age has been much desired and long delayed. But development in the waterfront Queens neighborhood is gathering momentum, leading some to believe the area is finally making a large move forward.
A total of 4,500 new rental units in Long Island City are in the pipeline for completion by 2015, according to Nancy Packes, a consultant to large developers. That surpasses every neighborhood in the city except Williamsburg, according to Ms. Packes’s data.
Many of those projects are already under construction, including the first building in an 1,800-unit multiphase project by Rockrose Development Corp. in the Court Square area as well as four buildings on the waterfront by TF Cornerstone that will have a total of 2,100 units.
Other major developers working on or eying sites in the area include Durst Fetner, L+M Development Partners and Silvercup Studios.
Meadow Partners recently acquired through foreclosure the Crescent Club, a Karl Fischer-designed condo with a backyard pool, which has sat eerily half-finished for years. The new owner plans to begin leasing as rentals in May, with one-bedrooms in the low $2,000s a month.
It has a familiar ring: in 2006, developers, brokers and city officials heralded the transformation of Long Island City from a haven for commercial bakeries and taxi stands into the next hot neighborhood. But the honeymoon was brief; when the real-estate market took a deep dive, sales activity in emerging neighborhoods like Long Island City was slow.
But with rents in prime neighborhoods of Brooklyn now approaching Manhattan levels in some cases, developers are angling to make Long Island City— where rents are still 30% lower than similar product in Manhattan—the new favored affordable option for singles and young families.
“I don’t think people consider Long Island City as an alternative to high rent in Manhattan. They think, ‘I’ll go out to Brooklyn, which has a vibrant downtown. Everybody knows Williamsburg,’” said Tom Elghanayan, chairman of TF Cornerstone, part of a family development company that built several large projects in the neighborhood and was recently split in two.
Indeed, for those who stuck it out through the downturn, they say there is a palpable shift.
Eric Benaim started the neighborhood’s main real-estate brokerage, Modern Spaces, just a couple of months before Lehman Brothers Holdings Inc. collapsed in 2008.
He now says he is in charge of leasing or selling 2,000 to 3,000 new apartment units in the next few years. “It’s like another huge building boom. Even bigger than it was in 2006,” Mr. Benaim said.
But Long Island City is a long way from catching up to Williamsburg’s restaurant scene and cachet, residents and developers concede.
While both were once gritty industrial neighborhoods, Williamsburg began to see an influx of artist and hipsters and funky dining spots before pricier glass towers followed. Long Island City’s rebirth, in contrast, is carefully orchestrated by private developers, motivated in part by the lack of developable land elsewhere in the city.
In the last few years, wine bars and chichi bistros belatedly have started to pop up, but the streets still feels eerily quiet by day and night.
Theodore Primis, a 36-year-old musician, says when he feels like going out for a drink or dinner he rarely stays in the neighborhood.
“I’ll get a drink here, but I prefer to go out in Williamsburg if I want to hang. Greenpoint, too. There are not as many hip places here. There is not as big a demand here for that,” Mr. Primis said.
But others are attracted by precisely that low-key vibe. Norie Jones, 35, and her husband were married in Long Island City and gave up their studio apartment in Midtown East to move there to start a family.
Even when the rent for their waterfront one-bedroom apartment went up, they decided to give up the doorman and the sweeping views and stay in the neighborhood anyway. “It’s more of a community” than Manhattan, she said.
But developers’ continuing heavy reliance on proximity to Manhattan and cheap rents, without a unique neighborhood feel like Williamsburg or even neighboring Astoria, could make them vulnerable to another downswing in the real-estate market, said appraiser Jonathan Miller.
Meanwhile, some developers are pushing to create more retail outlets in Long Island City, recognizing that proximity to transportation and cheap rents may not be sufficient to attract residents. Coffee bar Sweetleaf is opening another location soon in one of TF Cornerstone’s new waterfront developments.
Justin Elghanayan, president of Rockrose Development, is currently negotiating with large grocery stores to open in the company’s first new rental tower in the Queens Plaza area.
Washington — Ally Financial Inc. says it is "actively considering" putting its troubled mortgage lending operation into bankruptcy — a move that could cost it $1.25 billion and come by mid-month.
RBA slashes interest rates Sydney Morning Herald
RBA slashes interest rate to 3.75% (Video Thumbnail) Click to play video Return to video Video settings Please Log in to update your video settings Video will begin in 5 seconds. Don't play Play now More video Recommended Mark Bouris: RBA shifts ...
Brazil's President Steps Up Pressure On Banks To Lower Rates Wall Street Journal
Brazil's President Dilma Rousseff Monday said interest rates on loans in Brazil are still too high, keeping up the pressure on private-sector banks to lower rates further. "It is inadmissible that Brazil, which has one of the most solid and profitable ...
REAL ESTATE: Homeownership rate drops to 15-year low Press-Enterprise
BY LESLIE BERKMAN While housing vacancies declined nationwide in the first quarter, the faster growth was in renting and not home buying. The homeownership rate fell to 65.4 percent, the lowest level since 1997, according to Census Bureau data reported ...
US Considers Notes That Float Wall Street Journal
Instead of the interest rate being fixed throughout the life of the notes, the rate would move up and down as overall rates move higher and lower. The change would be the first new addition to the Treasury's arsenal of debt products in 15 years. Rate rise at weekly Treasury auctionThe Seattle Times
CNBC released their annual list of the country's richest counties last week and there were a few locks and, well, a few surprises. One might expect Pitkin County, Colo., home to the tony resort community of Aspen, to make this list, what with its small population and astronomical property prices, but we wouldn't have guessed that Hunterdon County, N.J. would cruise into #5. Located further from NYC than some of the famously wealthy New Jersey suburbs like Alpine, Hunterdon benefits from two groups of commuters, one headed to the Big Apple and the other to Philly. To give you an idea of why rich folks travel that far to work, take a look at this absolutely massive estate in the Hunterdon hamlet of Milford, N.J. Listed for $10.3M, the mountain-style mansion sits on 125 acres, with huge lawns and treetop views stretching for miles. Inside, there are seven bedrooms and 8.5 bathrooms, along with a squash court, opulent master suite, and towering great room.
↑ The suburbs of Washington, D.C. provide two of the top five richest counties, Fairfax County, Va. just across the Potomac, is the "poorer" of the two—if an average income of $133K a year can be considered poorer—to land at #4. This $8M mansion in McLean is a pretty typical suburban mansion, but with luxe interiors, stone patio, swimming pool, wine cellar, gym, and even a putting green amid the lushly landscaped grounds. Considering similarly sized homes on the river go for nearly twice this amount, this 5,600-square-foot, five-bedroom manse might seem like a deal to some McLean residents.
↑ This equestrian estate in Loudon County, Va.—the other D.C. suburb on the list, at #3—demonstrates one of the area's primary virtues, open space. This property, listed for a heady $15.8M, measures 464 acres, land that includes a riding ring, fenced pastures, and a pair of barns, along with formal gardens and frontage on Goose Creek. The restored stone farmhouse dates from 1853, and while it has been well maintained and updated over the years, it is in some need of a little style makeover. Still, revamping the inside should be a much easier task than finding another sprawling property so close to Washington.
↑ For the top two spots on the list, we move out of the bedroom community category and into the land of the ultra-high-end vacation destination. At #2, Pitkin County, Colo. is a playground for the rich, with some of the country's most expensive real estate as a testament to its desirability. This 15,000-square-foot log mansion in Aspen isn't the most expensive in the county, even though it's priced at $25M. With eight bedrooms, eight bathrooms, a gorgeous organic-looking swimming pool, and unreal views of Aspen mountain, it's going to take a lot more than the average local income of $134K to secure this trophy property.
↑ The second home owners in Nantucket County, Mass. are so rich and occupy so much of the island's housing stock that it takes home the #1 spot nationally as the wealthiest county. Considering just about everyone who comes here is looking to spend time on the beach, the rare waterfront properties command sky-high prices. This immaculate shingle-style beach house, with seven bedrooms and 12 total bathrooms, enjoys private access to the beach thanks to stairs over the dunes. That access, plus the pool and guest house, helped push the price of this place up to $20M.
Myrtle Beach real estate agent Arkadiusz “Eric” Grabara is facing felony mortgage fraud charges in a case that could lead to additional arrests, according to documents filed in federal court in Florence.
A federal jury has convicted Nadin Samnang his role in fraudulent mortgage loan transactions involving at least 25 homes in northern Virginia and more than $7 million in losses to lenders. Samnang, a 29 year-old Ashburn resident, is a District of Columbia real estate developer and formerly was a Realtor with Monorom Realty and Fairfax Realty, according to the U.S. Attorney’s Office.
Last week the Federal Reserve Board announced, once again, that it was committed to maintaining its zero interest rate policy through 2014. Nearly four years have passed since the Fed adopted the policy. What began as an emergency measure to support the entire financial system in late 2008 has seemingly become permanent policy at the Fed. The current rationale for the policy is that ...
Some news sure to please Fanilows everywhere: Barry Manilow has put his gated, walled Malibu, Calif., home on the market again. According to Trulia Luxe Living, the singer/songwriter bought the 3,500-square-foot beachfront contemporary for $3.85M in 2002, tried to sell it for $12.6M in 2009, PriceChopped it to $10.9M, and eventually took it off the market. This time around Manilow seem to have more earthly aspirations; after all, he's asking a relatively humble $6.95M.
Judging from the photos, parts of the four-bedroom, 3.5-bathroom abode are downright odd: the step-down living room, the airy ocean views interrupted by gobs of wood interior shutters, a taffeta-type curtain hanging awkwardly and function-less against a wall of an equally awkward bathroom—although the puppy photo hanging in there is pretty cute—and a sort of guest suite that appears to have zero right angles. That said, this place is sandwiched between the ocean and the street on a prime block of the city, plus there's a charming back patio, verandas overlooking the Pacific, and floor-to-ceiling glass walls in many of the rooms. And it wouldn't be the worst thing in the world to have a soak in that master tub, now, would it?
A noteworthy threshold was broken over the weekend. The Reno-Sparks’ real estate market now has fewer than 100 bank-owned houses available – 98 to be precise (active, non-pending, site/stickbuilt SFRs). Why is this noteworthy? Because normally many more than that … Continue reading →
S&P report revises US interest rate assumptions Reuters
April 30 - Standard & Poor's Ratings Services today published its revised interest rate assumptions for US residential mortgage-backed securities (RMBS) with a first distribution date in May 2012 and thereafter. The interest rate vectors are also used ...
The Palace of Versailles is not only one of the most famous buildings in the world, at one point the seat of political power in France, but in modern times it's also become something of a money pit for those with lots of cash to spend. In Florida, billionaire developer David Siegel had intended to turn his massive version of Versailles into a dream family home until the recession hit; strapped for cash, he was forced to list the uncompleted behemoth—the country's largest private home, in fact—for $100M. In China, Harbin Pharmaceutical Group attracted much public scrutiny when its home base was designed with the palace's gilded, opulent interiors in mind. In Wales, Kimmel Hall, the so-called "Welsh Versailles," was recently PriceChopped to $2.3M, one fifth of its original ask—astonishing considering the place has 122 rooms. And soon the DC area will have a contender in the form of a 25,000-square-footer called "Le Chateau de Lumiere."
Planned for a five-acre lot in Great Falls, Va., an affluent, manicured suburb some 30 minutes outside the capital, the five-bedroom mansion is intended to be a family home for healthcare entrepreneur Young Yi. The Washington Post recently took a detailed look at the proposal, which still needs permits to proceed; included are a wine cellar, gym, pool room, in-home theater with concession stands, spa, card room, gallery, and full-wing master suite, all contained within the "stone columns, arched windows, a curved roof and landscaping that echo the famed French palace." Naturally, Yi's soon-to-be-neighbors are none too pleased about the project, which will cost an estimated $15M to $20M to build. Said one: “I’m disappointed someone would disturb the natural beauty of Great Falls by building such a showy home here." Right, because this and this are modest?
NEW YORK (Reuters) - The U.S. housing market may still be in the doldrums, but funds that are betting on big gains in mortgage-related investments are a hot ticket this year on Wall Street. A number of hedge funds, asset managers and investment banks have launched vehicles dedicated to investing in the mortgage sector, often in securities backed by those loans, and sometimes focused on scooping ...
Pr. William raises real estate taxes, passes fiscal '13 budget Washington Post
Supervisors had indicated their real estate tax rate preference of $1.209 per $100 of assessed value, and that's what they supported in a 7 to 1 vote. Supervisor Peter K. Candland (R-Gainesville), who has advocated for a lower rate that would leave ...
Otis Bernard Livingston, 44, Gulfport, Mississippi; and Dionne Michelle Whitted, 37, Castle Hayne, North Carolina, the ringleaders of a mortgage fraud scam, were sentenced after three days of hearings.
Lydia Fong and Matthew Worthing, both of San Francisco, California, have agreed to plead guilty to their roles in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in northern California.
BurlingtonMortgage.biz announces that fixed mortgage rates returned to near the historical low point with a small decrease.Wilmington, NC (PRWEB) April 30, 2012 Mortgage rates for the most popular fixed rate home loan products are down slightly on average, reaching just above record lows, reports mortgage rate research website, BurlingtonMortgage.biz. On Thursday, April 26th, 2012 30 year fixed ...
Charlottesville is lucky to have great local news and great local blogs that serve to make Charlottesville a better place.
I believe local journalism, local government and local economies are the linchpins of a vibrant, healthy nation. For decades, as conglomerates swallowed up independent news outlets across the nation (our own local paper, Bay News, is owned by News Corp. – the same company that owns Fox News and the New York Post, for example), local coverage was watered down because community reporting is expensive, and stockholders want dividends. And because corporations can view employees as easily replaceable cogs, one reporter who lives in the community and has covered it for decades is just as valuable as one straight out of journalism school three states over.
But community reporting requires more than cogs. It requires more than an academic familiarity of those it covers. What meaningful local reporting requires is a personal investment. If the reporter doesn’t stand to benefit from a healthy community, his coverage will serve to dramatize and exacerbate problems rather than solve them.
When Sheepshead Bites ventures to cover the community, we do it because we’re neighbors. Our writers live here. Our business is based here. And we endeavor to support and uplift our neighbors for all of our benefit.
Is it time for an interest rate cut for Australia?As the market focuses on the Reserve Bank of Australia (RBA) interest rate decision, the question on investors’ minds is whether the central bank is going to change its monetary policy. RBA will decide on interest rates on Tuesday May 1 at 04:30 GM.
Romania Won't Cut Rates as Political Turmoil Sinks Leu Bloomberg
Romania's central bank will probably refrain from cutting its benchmark interest rate for a fifth consecutive meeting after the government collapsed for a second time this year, weakening the leu, analysts from London to Bucharest said.
Upbeat Signs for Real Estate As Home Sales Rise; New Short Sale Timelines to ... NewsLI
(Long Island, NY) Recent trends in the real estate market present both challenges and opportunities to real estate professionals. Throughout most of the country, real estate values have dropped dramatically, leaving many homeowners upside-down on their ...
Real estate sales near Marlins Park off to a slow start MiamiHerald.com
By Peter Zalewski Early indications are if you build it, they will come to the ballpark — but not necessarily invest in the real estate in the surrounding area. The residential real estate resale market around the new $634 million Marlins Park is off ...
Investors wary of Haifa real estate Haaretz
By The Marker Staff Whither housing prices in Haifa? While it's impossible to know for sure, the learned opinion of experts on the coastal city's real estate market suspect that at the high end of the market, housing prices will hold their own or even ...
A week ago at this time, I was being wheeled from the emergency room into the heart catherization lab at Banner Heart Hospital in the middle of what a cardiologist described as a “massive heart attack.”
Believe me, it sucked.
Yes, it was excruciatingly painful. You know how a doctor will ask you, “On a scale of 1 to 10, what is your pain level”? I’ve had broken bones, debilitating migraines and a couple of surgeries. I always labeled those a “10″. The heart attack was more like a 27. The pain is intensified by an overwhelming dread running through your heart (literally and figuratively) and soul that you are about to die.
But that pain is temporary.
It’s the look on your wife and children’s faces that really hurts.
That is a look I will never, ever, forget.
I am blessed beyond words to have an amazing family, and a lot of wonderful and caring friends. I asked Francy to post a status update on my Facebook page as I was going into the cath lab to let my friends know and to ask for support and prayers.
The response was overwhelming. We cannot begin to express our thanks to everyone that reached out. It really did make a difference.
Many people have asked for “the story”, so here it is. Fair warning, I’m going to get a little preachy on you at the end. Deal with it, there may be some things said that could save your or a friend’s life.
“That Day”
I flew in to Phoenix from Seattle late Friday night. About 12:30am Saturday morning, I went to Jack in the Box (ironic, isn’t it?) and grabbed a typical meal — two tacos and a Jumbo Jack with cheese — which I snarfed down with a soda and went to bed about 2am.
Here was the last Tweet I sent before my heart attack:
The car in front of me just ordered 60 tacos. (@ Jack in the Box) 4sq.com/Jg4hFn
Six hours later (note to self, you need to get more sleep) I woke up and felt fine. I plopped down in front of the computer like I do on any other morning and started looking at email, going through my feed reader and checking social media sites. Oh, what a thrilling life we lead.
Ten minutes or so into that, I felt a sharp stabbing pain right in the middle of my chest. Kind of cramp-like. Like a “stitch” you get in your side sometimes but this was right in the middle of my chest. “What the f**k?” I thought to myself. And then it was gone.
A couple of minutes later it happened again. And again.
Francy was out running errands and I called her to tell her I was having weird chest pains. She was on her way home and said I should wake up our daughter. We both thought it was most likely indigestion from the damn JITB tacos.
But this felt different.
Just moments later, it felt like Chuck Norris kicked me in the chest. I couldn’t take a deep breath. I couldn’t get up off the couch to get my daughter up. And then I started pouring sweat from every pore in my body.
I knew something was horribly wrong.
I called Francy back to tell her I was going to call 911 and she said to call them before I could get the words out.
I couldn’t even dial the phone right, so my daughter called them for me.
“911 what is your emergency?”
“I’m having really bad chest pains.”
“I’ve already got paramedics on the way…”
The 911 operator asked me a lot of questions. They were very calm and professional — which is good because at this point I’m pretty convinced that I’m dying, right in front of my baby girl. Francy arrived home moments before the firetruck got there. It felt like it took an eternity for them to arrive, but looking back and piecing together the timeline, they got there less than five minutes after we dialed 911.
From that point on, things were a blur. The pain was getting worse and worse. I remember the firemen / paramedics giving me oxygen, starting an EKG, putting nitro under my tongue, and putting in an IV. I remember getting annoyed because they couldn’t hear my answers because of the oxygen mask. I remember asking them if my wife and daughter were OK.
I remember thinking that I wasn’t going to make it to the hospital. The sense of impending doom was overwhelming.
Francy tells me the ambulance arrived and one of the firemen handed the driver the EKG strip and they glanced at it and ran outside to get the stretcher. She said when she saw that, she knew it was bad.
As I was wheeled past my wife and daughter, I told them I was going to be fine and not to worry. But to be perfectly honest, I thought to myself that I might not ever see them again.
The firemen loaded me in the ambulance and since Francy and Lauren weren’t there I asked them point blank, “Am I having a heart attack?” They aren’t doctors, and can only say, “We don’t know, but you have all the symptoms so we’re treating it like that.”
We only live about three miles from Banner Heart Hospital, but it felt like it took an eternity to get there. The firemen/paramedics were awesome though. At one point I apologized for repeatedly dropping the F-bomb when a wave of chest pain was particularly bad and one of the firemen responded, “Don’t fucking worry about it”. For whatever reason, that struck us both as funny. So did this exchange:
“We need to give you more nitro. Before we do, it’s important to know if you take Viagra or Cialis or anything for erectile dysfunction. It can interact with the nitro.”
“I may be dying, but I don’t need that stuff.”
“I think you’re going to be just fine.”
Once we got to the emergency room, things moved very quickly. There must have been 10 medical personnel in the room. I don’t remember much — lots of questions, at some point my wife and kids showed up. They were remarkably brave, but I suspect their fears were similar to mine. I distinctly recall some doctor looking me in the eye and saying, “You’re having a heart attack. We’re going to take you to the cath lab.” I kissed my wife and kids goodbye and was rushed into the cath lab. There I met my cardiologist for the first time, M. Joshua Berkowitz, M.D. He was very calm, very reassuring, but believe me, when he injected some dye to see if there were blockages in my coronary arteries and he looked me in the eye and said, “You are having a massive heart attack. You have one artery that is 100% blocked and another that is 95% blocked,” that will scare the shit out of you no matter how calm and confident the doctor is. Your fears aren’t relieved any by having the doc tell you that if you’d had the heart attack eight hours earlier on the plane, or waited another 20 minutes to call 911 you would be dead.
But that’s exactly the message I needed to hear because unless I make some significant lifestyle changes, the odds of me having a subsequent heart attack are high.
Dr. Berkowitz cleared the completely blocked artery via angioplasty and put in a stent, and opted to wait a couple of days to clear the one that was 95% blocked to allow the heart to recuperate some and for the kidneys to work on eliminating the dyes used in the procedure.
I won’t bore you with the details of the next four days in the Cardiac Intensive Care Unit and the “Telemetry floor” (where your heart is monitored 24 x 7) other than to say the care I received at Banner Heart Hospital was world class. The nurses, staff and doctors were without fail caring, compassionate and professional.
During those four days, the support from my friends all across the country — those I’ve met personally and those I’ve only ever “met” on-line — was overwhelming. Believe me, it makes a big difference to know that people out there care about you. I wish I could personally thank each and every one of you. You were, and will continue to be, a big part of my recovery.
A Wake Up Call
I don’t want to sound over-dramatic, and I certainly don’t want anyone feeling sorry for me, but I think it’s important to say this…
I am lucky to be alive. Through the miracle of modern medicine I went from having chest pains and calling 911 to lying in the cardiac cath lab in under 90 minutes. Thank God for the Mesa Fire Department, the paramedics, nurses, hospital staff and doctors that literally saved my life.
That’s all well and good, but truth be told I brought a lot of this upon myself, and my family and friends.
I’m just 51 years old, but I don’t eat well, I don’t exercise, I’m overweight, my blood pressure is too high and my cholesterol levels are even higher. Back in my younger days I smoked like a chimney, quit smoking years ago then started back up as what I called a “casual smoker” or a “social smoker”. I claimed, “I’m not really a smoker. I smoke less than a pack a week. I go days without cigarettes.” Yeah, well that’s a load of bullshit. It’s like being a little bit pregnant. Or saying, “This double cheeseburger isn’t bad for me because it doesn’t have bacon on it.” (oh how I already miss bacon)
There is nothing I can do about the fact that my Grandfather died at the age of 42 from a heart attack, or that my father has an defibrillator implanted in his chest. But I damn sure can do something about every other risk factor.
And you can rest assured I will. It is past time to change my dietary habits, lose weight, exercise, get my blood pressure and cholesterol level under control and not smoke one cigarette or cigar again. Ever.
I don’t ever, EVER, want to have another heart attack. Selfishly, it is excruciatingly painful and staring death in the face really jacks with your head. Far more importantly than that though, it puts your friends and family through hell. I don’t ever want to do this to my kids, my wife, my family and my friends again. I’m going to do everything I can to no longer be a “walking heart attack waiting to happen” because sooner or later it will happen.
I also don’t want to be “that guy” and tell you how to live your life. That’s not my place. Who am I to tell you how to live? But I can share my experiences with you, share my successes and failures as I make some pretty radical lifestyle adjustments. Share what I learn along the way. I can encourage you to eat better, to loose weight, to stop smoking. You won’t hear me say things like, “Those cigarettes are going to kill you!” and “My God you’re clogging up your arteries with all that fat and sodium you eat!” But you will hear me share what I can and do what I can to help my family and friends be healthier.
Trust me, you don’t want to have a heart attack. It BLOWS.
Learn these heart attack symptoms. Remember, you may not experience every symptom. I had zero pain radiating into my arms, shoulder or jaw. DON’T SCREW AROUND if you have any of these symptoms. If I’d waited just 20 more minutes to call 911, I’d be dead. If I’d waited 5 more minutes, I’d have more permanent heart damage. My cardiologist told me people die (usually men) every day because they wait too long to call 911. You can’t “tough out” a heart attack. You can’t will it away. Heck, I came *this* close to having my wife drive me to the ER. If we’d done that, we’d have missed out on all the medications the first responders can give you, missed out on the hospital having the EKG in their hands when I arrived. Missed out on crucial care in the first minutes of the heart attack. If you call 911 and it turns out you had indigestion or a panic attack, so what? At least you will be ALIVE.
And if you are like me — eating poorly, overweight, not exercising, pushing the blood pressure, have a lousy lipid profile (high cholesterol and triglycerides), or if you smoke at all, then please for the love of all things holy do something about it. If not for you, do it for your family and friends. You don’t have to go all vegan ultra-marathoner. Just start living healthier.
Sure, it may suck. Let’s face it, there is an awful lot to like about snarfing down two tacos and a Jumbo Jack at 2:00am and chasing it down with a cold sugary Coke or a frosty beer.
But there is a hell of a lot more to life than that. And I will gladly give up all the double-doubles on the planet for one more hug from my wife and kids. One more phone call or text or visit or email from a friend. One more day ALIVE and sharing all life really has to offer with friends and family…
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
It's hard to stay motivated paying off your debt. You sacrifice and send payments month after month, but your balances seem to inch down.
Creating milestones in debt plan can keep you from becoming discouraged. Milestones are mini-goals that you'll pass on your way to debt freedom. As you reach a milestone, give yourself a small reward to remind you of the great progress you're making.
Earlier this month, FHA mortgage insurance premiums (both annual and upfront) were dramatically increased for purchases and refinances with exception to *some* FHA streamline refinances. If you were preapproved with an FHA insured mortgage prior to April, you should check with your mortgage professional to make sure your preapproval is still valid with the increased mortgage payment. Remember, it’s your mortgage payment (debt to income ratio) and down payment that determines how much home you qualify for.
Upfront mortgage insurance premiums (typically financed) has been increased to 1.75% of the base loan amount.
Annual mortgage insurance for FHA loans with terms greater than 15 years (30 year fixed and adjustable rates) are now 1.2% of the base loan amount if your loan to value is 95% or lower; if your loan to value is greater than 95%, the annual mortgage insurance premium is 1.25% of the base loan amount.
For a 15 year fixed rate FHA mortgage, if your loan to value is 90% to 78.01%, the annual mortgage insurance premium is 0.35% of the base loan amount; loan to values over 90% will have annual mortgage insurance rates of 0.60%. NOTE: If you have a 15 year fixed FHA mortgage and your loan to value is 78% or lower, there is no annual mortgage insurance required.
If you have what’s considered an FHA “high balance” mortgage, which in the Seattle area, would be a base loan amount of $417,001 to $567,500 for a single family dwelling, annual mortgage insurance premiums are set to go up again effective on case numbers issued June 11, 2012 or later. HUD is scheduled to increase annual mortgage insurance premiums for FHA Jumbos/High Balance loans by an additional 0.25%.
Annual mortgage insurance is paid in your monthly mortgage payment. To determine how much your annual mortgage insurance premium will be, multiply the percentage reference above by your base loan amount and divide by 12.
**So how about those lucky folks I referenced above who may qualify for reduced FHA premiums?HUD is dramatically reducing mortgage insurance premiums for FHA streamlined refinances IF the FHA loan was endorsed by HUD before June 1, 2009. “Endorsed” is different than when your loan closed – it’s when HUD insured the FHA loan. This process often takes place several weeks AFTER the mortgage has closed – you may have closed your refinance on April 30, 2009 and if HUD endorsed it on June 1, 2009 (or later) you won’t qualify for the reduced rate.
Those who qualify will benefit from seeing their upfront mortgage insurance premium reduced to 0.01% and annual mortgage insurance reduced to 0.55%. This is effective on FHA case numbers issued June 11, 2012 or later. The good news is that you don’t have to wait to lock in your rate if your FHA loan qualifies for the reduced rate – you can start your application now! Your local mortgage originator can probably help you determine when HUD endorsed your FHA insured loan – I’m happy to help if your home is located anywhere in Washington state.
Toronto’s red hot real-estate market has helped deliver an unexpected boost to the city’s bottom line. The city will officially announce its year-end fiscals on Monday and it’s expected the surplus will be about $290 million, which is roughly double the $140-million surplus expected.
Coun. Denzil Minnan-Wong spoke to CBC News on Saturday and said much of the extra money comes from the land transfer tax, which is generating extra revenue as Toronto's real-estate market continues to surge.
Minnan-Wong cautioned that although he opposed the land transfer tax in the past, it might be too soon for the city to consider removing it.
“We have a quite a substantial debt,” he said. “The last administration spent $700 million for streetcars and didn’t have a way to pay for it. Until we have some way to pay for those large expenditures, it’s hard to make an argument to eliminate the land transfer tax."
The land transfer tax charges purchasers on a sliding scale base on the value of the property. A house priced at $500,000 would result in $5,700 in land transfer taxes.
First-time purchasers are eligible for a rebate of $3,725.
Would you like to know more about what's really happening in the Toronto real estate market?
There is now an email report available that shows all of the daily MLS® sales in the Greater Toronto Area as reported by the Toronto Real Estate Board.
Breaking up with a spouse or partner often means you have to separate things you once shared, including debt. It's typically better to separate debts before the divorce is final. That way you leave the marriage with only the debts you're responsible for.
KTVN Channel 2 News aired a piece on the market’s low level of inventory. Yours truly was asked to comment. And this blog got a mention. Check out the video below, or click on this link: Reno Real Estate: About … Continue reading →
RISMedia Partners with Pinnacle Quest Consulting to Manage its Top 5 in Real Estate platform; Appoints Verl Workman as President
Norwalk, Connecticut, April 23, 2012 – John Featherston, CEO and publisher of RISMedia and chairman and co-founder of the Top 5 in Real Estate Network announced today that RISMedia has entered into a strategic alliance with Salt Lake City, Utah-based Pinnacle Quest Consulting to manage the Top 5 in Real Estate Network® division of the company. Pinnacle Quest co-founder, Verl Workman, has been appointed as the new President of Top 5.
RISMedia’s Top 5 in Real Estate Network is a membership network of leading real estate professionals providing leading real estate information to consumers. More than just a sales-driven recognition program, the Top 5 in Real Estate Network meets a need that heretofore has never been addressed – helping consumers identify the most professional real estate agents in North America.
Pinnacle Quest Was Our First Choice
According to Featherston, RISMedia chose to partner with Pinnacle Quest because of their strong reputation in the real estate industry and long-standing relationship with top brokers and agents all across the country. “I’ve seen firsthand the impact Verl Workman and the rest of the Pinnacle Quest team have had on our industry,” said Featherston. “Their Getting REAL Results in an eCrazy World coaching program has helped literally thousands of men and women to become more professional, competent and successful real estate agents. That is exactly what our goal is with Top 5.” Featherston added, “Top 5 is all about recognizing the best-of the-best and then empowering them with the information services they need to stay on top in today’s Internet-driven society.”
Workman, who is a well-known real estate speaker and productivity coach agreed. “Top 5 is a game-changer in the real estate industry,” said Workman, “I believe that more and more of the top real estate agents are choosing to leave behind the traditional, outdated strategies that have been employed in the past. Information is power and forward-thinking agents who correctly understand how to use that information, will be the ones who come out on top.”
Top 5 Coaching Program to be Added
According to Workman, one key benefit that needs to be added to the current Top 5 program is coaching. “Effective immediately, we will offer group coaching to all new and existing Top 5 members at no additional charge,” said Workman. “Our plans are to bring the best agents together in a community of collaboration, coaching and the sharing of best practices. Pinnacle is honored to be at the center of this interaction.” According to Workman, the new Top 5 coaching program will be specifically geared to assisting Top 5 members in their professional development in areas such as lead generation, client relationship management, social networking, implementation of technology systems, and more.
About RISMedia
RISMedia is the leader in real estate information systems, providing the industry with news, trends and business development strategies for over 30 years through its flagship publication, Real Estate magazine, its leading website, RISMedia.com, and its renowned networking and educational events. Founded in 1980 by CEO and Publisher John E. Featherston, RISMedia has become the residential real estate industry’s definitive source for news and information for real estate’s most profitable and productive professionals.
About Pinnacle Quest Consulting
Pinnacle Quest Consulting combines the experience of owners Brent Gray, Stan Schreyer and Verl Workman to assist companies with operations, sales strategy and business growth worldwide. Its primary purpose is to assist individuals and companies in more rapidly and efficiently achieving their core objectives. Along with Verl Workman Seminars, Pinnacle Quest is one of the premier technology speaking and coaching firms in the real estate industry. To learn more or to book Verl to speak at one of your events, please visit www.PinnacleQuestConsulting.com.
After a recent post about asking for the sale, I got to thinking about closing sales. It is important to ask for a real estate sale, or you could end up in a situation where a sale is lost because no one can make a decision. But, it’s also...
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-Central VA real estate news, trends and opinions » read more ..
Thanks to Coy Barefoot for having me on his excellent Charlottesville – Right Now! show this afternoon. I tried to provide clear, quick analysis of the good, bad and possibly ugly in the Charlottesville real estate market – positivity framed with market realities and some context.
If every penny of your paycheck is already dedicated to something else, paying off debt seems out of reach. You can come up with the money to pay off your debt, but you have to be creative. For example, have you considered getting a roommate or boarder? What about selling some old things on eBay or Craigslist? I have a list that includes 77 ways to come up with extra money for your debt. Check it out.
(what’s this have to do with Charlottesville real estate? Nothing other than this is but one more thing that makes living in Charlottesville fantastic … if one can make time to participate and get involved. “Real estate” is about life and lifestyle. This Festival looks to complement and accentuate life in Charlottesville – for the better)
- The one about which I’m most excited – TTFF’s Innovation Track, in which they seek to explore Place Based Innovation, something about which I think Charlottesville really does (and should) excel. The Sustainable Design panel looks to be exceptional:
Our “Place Based Innovation” continues with an acknowledgement of the ways the well-being of future generations will be built on this generation’s choices. Charlottesville is home to groundbreaking pioneers looking at design, infrastructure, and resource development. These decisions not only help achieve ecological and cultural diversity; they help us stay productive. This discussion focuses on local innovations in sustainable design and product development, revealing the successes and barriers to increasing sustainable practices in our community.
A number of the speakers noted that Charlottesville has a variety of resources that could be better leveraged for social benefits.
“Charlottesville is such a great place to live, a paradise,” Nguyen said. “But the problem with a paradise is you can get complacent when you don’t have the pain to get you to do things.”
“Charlottesville has all the energy and talent to make this a great community for everyone, we just need to harness it,” Brown concluded.
* I’m not really sure what relevance the buffalo represents.
-Central VA real estate news, trends and opinions » read more ..
I’ve tracked the housing vacancy rate for homes actively on the market in the Charlottesville MSA irregularly over the past several years; it’s an indicator as to the health of the housing market. More occupied homes = a healthier market.
- 2271 residential properties marked as “active” in the MLS
- 525 of them are marked as “vacant”
- Simple math says that 23% of the active inventory is vacant.
I’ll take this decreasing vacancy rate as a very good sign for the Charlottesville economy. Here’s why:
- Fewer vacant homes means fewer deteriorating properties, theoretically fewer distressed homeowners as there are fewer people making two house payments, often pulling from savings, staving off what may be the inevitable end result ….
- Fewer vacant homes means there’s less of a psychological drag on the market.
- More of these vacant homes are being rented … those renters may one day be homeowners.
- Fewer vacant homes means the Charlottesville real estate market’s starting to recover.
But … (and this is where my conflicted mind starts to implode)
- What about the shadow inventory? What happens when prices start to rise (and in some parts of our market prices are rising) … and banks start releasing the massive inventory they are currently holding to the market?
PRE-FORECLOSURE Property in EILERS LN 1402, LODI, CA 95242 This is a Pre-Foreclosure property (Lis Penden) located at LODI, CA and Listed Price is $132505 The Property has 3 bed(s) and 2 bath(s) and the estimated market value of this...
The chart shows the market activity in Glendale Heights for attached homes & condominiums in the last 30 days based on information from the MRED Multiple Listing Service.
There are currently 108 active listings of attached homes & condominiums as of 04/18/2012.
BANK OWNED Property in E OSAGE AVE, MESA, AZ 85212 This is a Real Estate owned (REO) property located at MESA, AZ and Listed Price is $104500 The Property has 3 bed(s) and 2 bath(s) and the estimated market value...
PRE-FORECLOSURE Property in DARDENNE ST, CALABASAS, CA 91302 This is a Pre-Foreclosure property (Lis Penden) located at CALABASAS, CA and Listed Price is $1028645 The Property has 4 bed(s) and 4 bath(s) and the estimated market value of this property...
We were fortunate to be invited to consult on the local and international marketing of a beautiful luxury residential development project on the east side of San Jose, in the Central Valley of Costa Rica. From the Central Valley it is an hour to an hour and a half drive to either the Caribbean/ Atlantic coast or the Pacific coast. The mild climate is consistently in the low 80’s with relatively low humidity.
Our experience in meeting our clients and the various people we were introduced to was nothing less than enchanting. When discussing the various aspects of the project, each individual in charge was passionate about their expertise. In planning the site, the developers agreed to keep all the mature trees and bushes intact and incorporate them as part of the common areas. This included the coffee trees which had migrated on the property from the coffee bean plantation next door. The landscape architect also decided to identify the trees and plants by both their Spanish and Latin names. There are walkways designed to explore the grounds and benches to sit on where you can reflect upon the magnificent flora.
Our strongest impression on this adventure was the friendly nature of the people we met. Everywhere we went, kindness and acceptance was abundant. Time was not a pressing issue in the many meetings we attended. There was no sense of urgency or the feeling of being rushed. What was more important was feeling good about each other.
We asked our new friends, colleagues and clients, “What makes Americans and Europeans move to Costa Rica?” Here is what they said, essentially: “We have a strong sense of family, a deep caring for each other, and a slow paced lifestyle. Our people are well educated with a 94% literacy rate. We are also pro-business as we attract many companies who want to move here. These companies are aware of the value of an educated work force”.
Intel was offered as an example. They had identified 10 cities where they could open offices in the South and Central America’s. With everyone wooing them, Costa Rica was not even on their radar. The people rallied, as did the President and all other luminaries, to convince Intel to choose Costa Rica, which they finally did. Now, Intel continues to grow and expand there.
Advising our Costa Rican clients on marketing luxury real estate was a sheer delight and we have made some wonderful friends in the process. We encourage you to reach out and connect with your counterparts in this fine country.
BANK OWNED Property in S HACIENDA DR, TEMPE, AZ 85281 This is a Real Estate owned (REO) property located at TEMPE, AZ and Listed Price is $90400 The Property has 3 bed(s) and 2 bath(s) and the estimated market value...
-Central VA real estate news, trends and opinions » read more ..
As always, pay attention to the segment or segments that affect you. There is no “the market is up” or “the market is down.” Condos in the City of Charlottesville near the Downtown Mall are different than single family homes in Greene County – different trends, different factors affecting them, different economic engines and hubs, different schools, different property taxes … you get the picture.
I’ll be adding to this post this evening but wanted to get this out before my afternoon appointment. (priorities, you know?)
Most luxury real estate marketing professionals think of branding as a creating a new look for their product or service. But, the realm of branding actually occurs in the minds of your target market. And, it occurs in product or service categories. Whoever comes up “top-of-mind” in a category becomes the market leader.
For every product or service category that is meaningful to us, we have a category. Often there are many sub-categories in our mind. For example, personal computers have a sub-category for desktops, laptops and tablets. Some sub-categories even have their own sub-sub-categories.
For example, when Apple introduced that Mac Air, a very slim and light-weight laptop that runs on a Flash drive (not a hard drive) a new sub-sub-category was born. As Intel and many other companies jumped on the band-wagon to copy the success of the Mac Air, the category was given a name: “Ultrabooks”.
It can also be said that ultrabooks are a niche within the product category of computers. A niche is a specialized but profitable corner of the market Identifying and dominating an uncontested or under served market niche is the fastest route to market leadership in that niche. The operative word in the definition of niche is ‘profitable’. A niche would simply not exist if there was not a market for it that was profitable.
The iPad actually redefined the category of tablet computing, as there were several attempts at creating this new category prior to its launch. Apple has so outdistanced any of its competitors in both quality and quantity of units sold that it is next to impossible for any other company to catch up.
Only Amazon’s Kindle Fire which uses Android as its operating system, has been successful at making a dent. But, the Kindle Fire can only complete on price (not on features and not on the the number of available apps). Because, Amazon sells their tablet at cost or below they have made it very difficult for other Android based competitors to enter this category. And, other tablets using alternative operating systems, such as Windows 8, will have a very tough time entering the market.
We offer this discussion of market categories to get you thinking about potential uncontested or under-served market niches, as luxury real estate marketing professionals. Here is why: What is the first brand to come to mind when you think of the category of tablet computer? For most people tablet and iPad are synonymous. What would it mean to you if your name was synonymous with the profitable niche that you decided to dominate?
-Central VA real estate news, trends and opinions » read more ..
People want to be close to stuff, and they want to be able to get to that stuff easily. More often, in the City of Charlottesville and more urban parts of Albemarle, “getting to that stuff” includes bicycles. Now the Charlottesville MPO is seeking to capture data that will show how many are biking to places.
For the next month or so I’m going to be using the Cville Bike mApp to track my bicycle rides around Charlottesville and Crozet instead of MapmyRide.
On April 14th the Charlottesville-Albemarle Metropolitan Planning Organization (MPO) will release the Cville Bike mApp, a free, bike route mapping application for iPhone and Android phones. The App allows cyclists to record their trips and send the trip information to the MPO for transportation planning purposes. With an expected decrease in federal transportation funding, this data will help elected officials better determine where to target limited available funds for future cycling enhancements and improvements. This data input effort will also position the region to be more competitive for transportation grant funding. More specifically, the App will allow transportation planners to map cycling patterns, determine cycling corridors, identify cycling barriers and find appropriate locations for cycling facilities.
The MPO is offering valuable prizes for participation in the data collection period. If a cyclist chooses to enter the raffle and records 10 or more rides, he or she is eligible to win a gift card or service from a local bicycle shop. Participating shops include Blue Ridge Cyclery, Blue Wheel Bicycles, C’ville Bike & Tri, and Cville Bike Lab.
The MPO will be collecting cycling data over an approximately one month period – from April 14th to May 18th. Help local planners and elected officials improve cycling in Charlottesville and Albemarle by recording your bike trips using the Cville Bike mApp. Remember, mApp it for Better Biking!
I have no doubt that I could find significant and substantial data to support the opposite perspective, but in my practice, I have found that my clients value bicycle and walking paths and accessibility. Can I place a quantitative value on that? No; sometimes it’s a matter of “will they buy it?” Yes or No.
As we pointed out in our report, The Economic Benefits of Bicycle Infrastructure Investments, studies have shown that real estate property values increase with proximity to bicycle paths. People enjoy living close to bike paths and are willing to pay more for an otherwise comparable house to be closer to one. For example homes within a half mile of the Manon Trail in Indianapolis, Indiana, sell for 14 percent more than comparable houses farther away from the trail.
As promised, here is the slide deck from my presentation at RETSO (Real Estate Tech South). They won’t be a whole lot of good without the accompanying talk, but…
So sorry there wasn’t enough time to get to all the (great) questions. Feel free to drop your question in the comments and I’ll be happy to answer them. If you want your question to be private, email me.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
The posts on this blog have been a bit sparse in the last week or so. We’ve been working like crazy getting client work finished, and pulling together the Lead Conversion Engine™. And, we’re almost there! The video below...
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Will Chicago be the next big city to witness its housing market implode, virtually without warning?
Friday the Treasury Department set off alarms in the Windy City when it spotlighted Chicago's housing market in its monthly Housing Scorecard, describing its condition as "continued fragility."
"Fragile" is not a word Chicagoans like to hear others use to describe their homes. Within hours of the release of the Treasury Scorecard the Chicago Tribune carried a report on it, noting that it "shines a national spotlight on Chicago and paints a somber picture of President Barack Obama's hometown."
In fact, Chicago has been encountering a rising tide foreclosures over the past year, and they've had their impact on prices. The greater Chicago market's foreclosure count is up 43 percent over a year ago; one in every 302 housing units is a foreclosure, ranking it fourth in the nation, according to RealtyTrac. With an REO saturation level of 35.7 percent compared to 29 percent nationally and it ranks 13th among Clear Capital's lowest performing markets, with a median 4.4 percent year-over-year price decline. Moreover, foreclosure processing in Illinois, a judicial state, takes an average of 575 days which means distressed mortgages in Chicago remain unresolved in the foreclosure pipeline 50 percent longer on average than in other cities, the Treasury report said.
While much of the nation's foreclosure concern has been focused on the Sand States, Chicago has fallen victim to a stuttering economy and a high degree of negative equity. Nearly one in four residential properties in the Chicago six county region is underwater, with just under $25 billion of negative equity. The average underwater property has 31.8 percent more outstanding mortgage debt than the property is worth, according to the Woodcock Institute. In fact, Chicago's housing market faces a full plate of challenges including a high percentage of distressed mortgages, high vacancy rates, a surge in suburban poverty, as well as severely underwater mortgages.
As a luxury real estate marketing professional you can have a superior value proposition, but will you be able to capture the attention of your ideal client? As the world becomes more democratized with technology, the competition for attention has become one of the biggest marketing challenges. First, you have to capture the attention of your ideal clients, (so they can hear you loud and clear above the din of your competition), and then you have to hold on to it.
Here is a clear example from the world of wine. According to 2009 figures, over 20 billion bottles of wine were produced globally. Competition for attention is fierce. We recently discovered two Spanish wines produced by La Granja (the farm) 360 from Spain. Modestly priced at $3.99 and $4.99 a bottle, it is thriving in sales side by side with similarly priced California wines (California makes 90% of wines in the US). What makes is different is its message on the bottle.
Both wines have eye catching labels. The first bottle pictured above is a 50/50 blend of Tempranillo and Garnacha grapes. Wine connoisseurs describe it as, “An everyday drinking soft rounded juicy red wine, with rich ripe raspberry flavors, and great match for barbecue, roasted pork chops, spare ribs, sausages, grilled vegetables and cheeses.” The ordinary zebra has made itself extraordinary by painting his back end in red!
The second is a Syrah with a 100% juice Syrah grapes, planted for the first time in this region. Unlike its North American cousins, this wine is not jammy. Here is the review, “It’s ripe with blackberry-fresh-off-the-bramble flavor with hints of dried herbs and well-balanced tannins. And as the label of the rooster with the golden egg portends, this wine is provocatively irreverent… it keeps you pouring.” The rooster is crowing about producing a golden egg!
Like wine there may be several comparable luxury real estate marketing professional in your market place. This is where graphics and design come into play. Graphics are a shortcut to get the message across of how you are different, and to be great it has to convey your message at a glance.
According to the MLS 98,687 residential properties are available
The MRED MLS shows the following active listings as of April 9, 2012
Single Family Home 49,658
Attached Single Family Home 26,990
Multi-Unit Building (2-4 units) 5,084
Mobile Home 358
Vacant Land 10,940
Residential Rental 5,483
Deeded Parking Space 178
Multi-Family Building (5+ units) 934
In the last 30 days there were 7,402 closed sales of residential property. Based on the current level of absorption that means there is 13.33 months of inventory currently listed on the market for sale.
One of the key components of strategic branding and marketing, when marketing luxury real estate is thoroughly knowing the mindset of your target market and speaking to them in their language. That is what is known in marketing terms as messaging. When you can communicate your extraordinary promise of value succinctly, i.e., with an economy of words and graphics, and you can do so on an emotional level, with passion, your chances of success increase exponentially.
While we were interviewing the top brokers in Steamboat Springs for our series, 50 Top Luxury Real Estate Markets in the USA, one of the brokers told us about a local mountain sports and lifestyle clothing company called Smartwool. This company has their passionate messaging, the articulation of their unique promise of value, spot on! Here tis how they do it:
WE WERE
MADE FOR
EACH OTHER.
What you get from us isn’t just a product; it’s the ability todo more of what you love,for as long as you want. That’s our promise.
This value proposition zeros right in to the emotion core of mountain athletes who are passionate about their sports, those who aim for endurance or just want to be able to stay outside, longer. Messaging at its best is “speed matchmaking” And, that is what happens here.
The faster you can create an emotional bond with your target market the faster you can build trust. And, trust is the prerequisite for buying products or hiring a service professional.
Then, Smartwool goes on about “The Power of Comfort”. They say,
“When you’re comfortable, your body performs better, allowing you to forget about what you’re wearing and enjoy the moment”.
High performance is the archetypical quest of athletes, especially competitive ones. It also appeals to their spiritual side in that it addresses one of the greatest benefits of outdoor sports (and simply communing with nature, for that matter): quieting the mind and being in the present.
Smartwool as a company is obviously passionate about mountain sports and the outdoor lifestyle. Their messaging makes their passion palpable. Their ability to communicate their passion clearly, and with an economy of words that resonate within the heart and soul of their target market, is remarkable.
Do you know what you are passionate about? Do you know what your target market is passionate about? How can you communicate your extraordinary promise of value to your target market, as a luxury real estate marketing professional, succinctly so that they quickly bond with you and trust you? The sharper your messaging is, the more you deliver it with passion, the faster the matchmaking process can happen and that is what great marketing is all about.
Coming from the guy who “went” by the name of the real estate blogger, I am calling this game…
Real Estate Blogging is dying, fast.
If you want to learn more, contact me on Twitter – @tomroyce or call me at 770-755-1503.
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
As a luxury real estate marketing professional it is important to be well versed in all the cultures that surround us and particularly those in your marketplace. It is a great way to establish rapport with a potential client, and to become the go to person for that community. In our previous post, we discussed several spring events; here is one from Murcia, Spain that is delightful, and would be well worth attending if you find yourself in Spain.
One of the autonomous regions of Spain is Murcia. Murcia borders are the Mediterranean Sea, Andalucía and Valencia. Unlike its neighboring regions Murcia is a one province region. One of the notable festivals in Murcia is the “Entierro del la Sardina (Burial of the Sardine)”. This festival is held after Easter. This traditional parade began in 1850. A group of students decided to form a group whose leader is a sardine (symbolizing fasting and abstinence) in order to relive the Carnival Fiesta.
On the 14th of April 2012, a grand parade of floats representing the various sardine (Sardinero) groups, will be accompanied by musicians of every variety including Samba bands, costumed Giant heads representing the gods of Olympus, and all participants will be throwing thousand of toys to the crowds.
The evening ends in the wee hours of the morning with the burning of the papier-mâché effigy of the Lenten sardine in Plano de San Francisco.
What a great way to celebrate the end of the Eater holiday. Happy Easter Everyone!
As a luxury real estate marketing professional it is important to be well versed in all the cultures that surround us and particularly those in your marketplace. It is a great way to establish rapport with a potential client, and to become the go to person for that community.
The Spring Season is a time of celebration. It signifies rebirth, new life, and the beginning of a New Year. Here are a few of the rites of spring from around the world.
The Persian New Year is known as Nowruz. It is celebrated by the Iranians, as well other parts of the world, Central Asia, Crimea and some groups in the Balkans It is based on the Zoroastrian religion, and it celebrates the day of or the day after the spring vernal equinox, depending on the region.
The Buddhists celebrate the New Year with Buddha’s birthday on April 8th. In Thailand, Burma, Sri Lanka, Cambodia and Laos, the New Year is celebrated for three days from the first full moon day in April.
Easter is the Christian celebration of the resurrection of Christ. Emperor Constantine decided the date would be celebrated on the first Sunday after the first full moon of the vernal equinox. This date may fall in a 35-day range from March 22 to April 25.
The Greek Orthodox Christians celebrate Easter after Passover. The logic in their celebration is that Christ died after Passover, and this is a more accurate time to celebrate. This year the Greek Orthodox Easter will be celebrated on April 15th.
Passover is observed to commemorate the freeing of the Jewish people from slavery in Egypt. A special meal, (Seder) is prepared accompanied by a reading of the Passover story.
In South and Central America, Catholics celebrate Easter and La Semana Santa, or Holy Week as one of the highest holy days of the year. In Latin America and Spain, the week leading up to Easter involves solemn processions, prayer, masses and other preparations for Jesus’ rebirth. Cascarones or confetti eggs are made by hollowing out a chicken egg and filling it with confetti or small toys. The outside of the shell is also decorated. To have a cascarone broken on your head signifies good luck.
In the Sweden Walpugisnacht is celebrated. The legend is it that witches filled the skies on the eve of St. Walpurgis Day on April 30 or May 1st. Torches are made of rosemary and burned so that the smoke will repel the witches. This festival is also celebrated by the Czechs, Dutch, Estonians, Finns, Germans, Latvians, Lithuanians, and Austrians.
Get acquainted with the people who are buying. As the planet seems to shrink and people from more nations are in the market for luxury real estate here in the United States, it is important to learn the different customs and unique slants on luxury. Being knowledgeable of the various cultures of our planet gives you an appreciation for all the people who make up our global melting pot.
Jay’s Note: Here’s a nifty little video by Thompson’s Realty agent Kristin LaVanway with an update on the current Phoenix real estate market. Writing about market stats is difficult, and boring. Which is why you rarely find stats posts here. How does one make statistics interesting? Kristin does in this video. Hopefully there will be more to come!
Here’s the video synopsis, in Kristin’s words: The real estate market in Phoenix continues to return to a more “normal state” whatever that means. Prices are edging up especially in price ranges below $250K, and inventory has dropped below the 2 month mark. Yikes!
Think the shadow inventory is going to replenish the market – don’t be so sure. However you look at it, we are going to be low on inventory for a while. Buyers: get over the fantasy that another big price drop is going to happen here in Phoenix. All signs point to higher prices.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
-Central VA real estate news, trends and opinions » read more ..
Charlottesville is (still) a small town. It might seem smaller when you try to buy or sell a house.
Please. Please. Please. If you’re buying or selling a house, be aware that what you are posting on your social networks or blogs may be found by the buyer, seller or real estate agent … and may harm your negotiations.
Buyers – Don’t talk on Facebook/Twitter/G+/whatever about what houses you like or love. Until after you close. When you get a house under contract, don’t tell the world. (or do so to a very limited number of friends) — and don’t assume that you’ve locked down your Facebook privacy settings; they’re complex … see this creepy story if you don’t believe me.
Sellers – Don’t talk about what you’re doing to your house to get it ready. Unless it’s really awesome. Don’t talk about defects – leaks, cracked foundations, how you are covering up said leaks or cracked foundations (fix them!). While Virginia is a caveat emptor state and you don’t have to disclose anything, it’s probably not good practice to talk about what’s wrong with your house.
“It’s awkward” to be friends with someone on Facebook (moreso than Twitter or G+) but that’s ok … the transaction will be over soon.
Think about it – if I am working with a buyer and she discovers that it looks like the seller was transferred to Charlottesville a couple years ago, just completed a post-doc program at the University of Virginia … and they have three kids in high school who are looking at colleges … one could reasonably infer that these particular sellers are motivated.
Or … the Seller who just received an awfully low offer from Maryjanne Webstqr (sic )** — In this world, it’s natural to google the purchaser. We discover that she’s posted on Facebook (or Twitter, or Google Plus) (having not locked down her newly changed timeline/privacy settings) says that “I love this house! We went in low, but if they don’t take it, we’ll pay full price! It’s perfect and we need to be in before school starts!”* Think we’re going to ignore that in negotiations?
3. Use Google Maps (update: use Bing – it’s better and more up to date) to see what surrounds the house. Is the street tree-y? Industrial? How far is the nearest park? How far to downtown, UVA, etc? (ed note: check this out)
4. Google the street address + Charlottesville to get more information about the neighborhood. For example: Grove St. plus Charlottesville clued me into the Grove Square development (which I was unaware of because I’m new to C’ville). (ed note: don’t forget to visit Charlottesville Tomorrow for the most in-depth reporting on growth, development and politics in Charlottesville/Albemarle)
Or this – “I hope our house sells soon … we put an offer in on the house of our dreams in the place we’re moving to and couldn’t stand it if we lost it”*
Don’t tell the world what you’re doing and you’re going to be better positioned for the inevitable negotiations.
U.S. Secretary of the Treasury Timothy Geithner (right) told a subcommittee of the Senate Appropriations Committee March 28 that he believes officials at both Fannie Mae and Freddie Mac favor mortgage write-downs for underwater borrowers, despite resistance from the agencies' regulator, the Federal Housing Finance Agency, Bloomberg reported.
While the Obama administration has continued to pressure the FHFA to offer principal reductions, the agency’s Acting Director Edward J. DeMarco has persistently refused, explaining his contention that write-downs do not make economic sense for the two government-sponsored enterprises, Bloomberg reported. DeMarco noted that such an action could create a “moral hazard” where borrowers who are current on their mortgages would begin to strategically default.
At the end of 2011, 12.1 percent of mortgages were delinquent or in foreclosure, according to data from the Office of the Comptroller of the Currency. The mortgage delinquency rate was 12.4 percent in 2010.
Greater Toronto Realtors reported 9,690 sales through the TorontoMLS System in March 2012. This result was up by almost eight per cent in comparison to the 8,986 deals reported during the same period in 2011.
“The GTA resale market has not suffered from a lack of willing buyers this year. Buyers have been spurred on by the positive affordability picture brought about by low mortgage rates,” said Toronto Real Estate Board President Richard Silver. “The challenge has been a lack of inventory. Many listings have attracted multiple interested buyers. Strong competition has led to annual rates of price growth well above the long-term average.”
The average selling price in the GTA was $504,117 in March – up by 10.5 per cent in comparison to March 2011.
“The number of new listings was up last month in comparison to March 2011. However, based on the historic relationship between price and listings, the GTA resale market should be better supplied. If competition between buyers remains as strong as it is right now, we will almost certainly see an average selling price above $500,000 for 2012 as a whole,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.
This post is not legal advice. For legal advice, consult an attorney, not a blog.
Yesterday, Division I of the Washington State Court of Appeals (which handles appeals from King Co. north to Canada on the west side of the Cascades) handed down a decision that addresses the terms of the standard NWMLS Form 51 Rescission. This form is routinely used by agents to formally and definitively rescind one contract before a client enters into another. The Form, drafted by attorneys on behalf of the NWMLS, includes this rather self-serving provision:
RELEASE. The parties agree that the Agreement between them and all other agreements or undertakings between them in respect to the Property are hereby rescinded; and each releases the other and all real estate firms and brokers involved with this sale from any and all present or future liability thereunder and/or in connection with said sale, other than as set forth hereinafter, provided, that nothing herein shall be construed to terminate any existing agency relationships or agreements unless otherwise agreed in writing.
(Emphasis added.) There is no reason to include the release of the real estate firms and brokers involved in the transaction from any liability, other than of course to protect the real estate firms and brokers.
In the case of Hanks v. Grace and RE/MAX, the agent represented both the buyer and the seller. Notwithstanding the instructions from the seller to not present an offer contingent on the sale of the buyer’s home, the agent presented such an offer (albeit one without the correct addendum, the Form 22B, which specifically renders the contract so contingent; instead, buyer simply submitted an offer subject to a 22A Financing Contingency with the “contingent on sale of buyer’s home” box checked). Not realizing that the offer was contingent on the sale of the buyer’s home, seller accepted the offer. This happened in March of 2008.
Three months later, buyers having not sold their house — did I mention this was all happening in the spring of 2008? — the agent decided for reasons known only by the agent to buy the home himself. So they needed to formally rescind the prior PSA, and naturally the agent selected the Form 51 for this purpose.
Needless to say, the agent couldn’t complete the purchase either. Seller eventually sold the home two years later for $158k less than the amount of the original offer. When seller realized that the agent had attempted to get over on her by concealing the contingent nature of the original offer, seller retained counsel. Further investigation revealed a second interested buyer who expressed an interest in making a full price, non-contingent offer at the same time as the original buyers. But the listing agent never so informed the seller.
Following a jury trial on buyer’s claim of negligence against the agent, the agent was found liable and the seller was awarded $195.5k in economic losses and another $170.5k in non-economic (i.e. pain and suffering) damages.
Before the case got to trial, attorney for seller convinced the trial court that the release provision of the Form 51 was void and unenforceable as a violation of public policy. Otherwise, by having seller sign the rescission necessary for a new contract, the agent would have shielded himself from all liability to the seller arising out of his negligent representation. In a nutshell, the law should not — and now does not — tolerate an agent shielding himself unfairly in this fashion. It is not consistent with good public policy.
And the Court of Appeals agreed. It found that the release violates public policy, in part given the role of real estate agents in the purchase and sale of property.
Given this decision, any future attempt by a real estate agent to avail themselves of this shield from liability is likely to be unsuccessful. It remains to be seen if the NWMLS will simply revise the document to elimate the objectionable term. Certainly doing so is consistent with the role agents are supposed to fill and which they regularly hold themselves out as fulfilling, the protection of their client. That protection should not be sacrificed for the self-interest of the broker. Its simply not good public policy.
Steamboat Springs has a reputation as being one of the friendliest resort towns in the USA. The townspeople have a tradition of genuinely caring for each other, an “Old West” ranching tradition, that is engrained in the soul of the community. And, they are proud of it. Come Winter Olympics the entire town gathers to send off their local Olympic athletes. If a neighbor needs help they are there to help them.
-Central VA real estate news, trends and opinions » read more ..
Short sales still comprise parts of the Charlottesville area real estate market; in some segments they are a greater percentage, in others they are nearly nonexistent. I’m sharing this information with you so that you can be as well informed as possible. Short sales remain an adventure – for buyers, sellers and their Realtors – and hopefully this settlement signals some progress.*
You may have heard about the $25 billion mortgage settlement … for a look at some of the critical numbers in the settlement, ProPublica has a great breakdown, including:
60-200: documents signed daily by different individual loan processors working for Bank of America, according to the government audit.
12-18 inches: height of the stacks of documents one Bank of America employee signed “without a review.”
$1 million: fine to be levied on the banks for each violation of the terms of the overall settlement, escalating to $5 million for repeat violations. (Exactly how fines will be tallied is still unclear.)
But did you know that the settlement ostensibly makes short sales, often the bane of existence who are fans of things happening in a timely fashion, logic, reason and accountability … better?
1. Short Sale Timeline. The settlement contains short sale standards that are similar to the Treasury Department’s Home Affordable Foreclosure Alternative, or HAFA, program. A number of these standards will improve the short sale process including making short sale requirements publicly available, development of co-op programs to evaluate short sales prior to marketing the home, and the implementation of a 30-day response requirement after receipt of all required information and third party consents.
2. No Dual Tracking. As part of the settlement, the five servicers will no longer be able to proceed with a foreclosure sale if a short sale or deed-in-lieu of foreclosure has been approved by all parties (first lien investor, junior lien holder, and mortgage insurer, as applicable) and proof of funds or financing has been provided to the servicer. Servicers will also face strict foreclosure referral guidelines if borrowers have requested a loan modification.
3. Single Point of Contact. NAR has long called on servicers to establish a single point of contact for borrowers. This provision will not only assist in maintaining consistency and coordination of loss mitigation options, but will reduce the amount of time agents and brokers spend discussing individual short sale files with new negotiators.
4. Establishment of Loan Portal. Though processes have recently improved, many members report that lost documents requiring multiple submissions continue to cause delays. The five servicers have agreed to consolidate information for borrowers by developing online loan portals that will provide borrowers with access to information, eligibility factors for loss mitigation programs, and inform borrowers of required documentation that is missing.
5. Strong Enforcement Mechanism. The success of a number of well-intentioned programs has been hampered by voluntary servicer participation and a seemingly lack of compliance oversight. The five national banks party to the settlement will be required to regularly report compliance to an independent, outside monitor that reports to state attorneys general. State attorneys general and the U.S. Department of Justice can seek redress if the banks don’t follow the settlement terms.
When you are marketing luxury real estate, here is a fun way to impress your clients while driving them from property to property. Why not offer them an espresso?
Handpresso, a French company is the creator of an outdoor version of an espresso machine powered by a hand pump which is available in the US via importika.com, $199.95. This model comes with 4 cups, a serving flask, and two small napkins in an elegant black carrying case, As you are touring the gardens of a home you are showing, you can relax with your clients as you discuss the property and serve them a freshly brewed espresso. We would suggest packing a tin of biscotti and some chocolate to sweeten the deal making process. The coffee pods are also available in decaf.
The other gadget is a personal one. Since 2008, European drivers have had the advantage of being able to brew a creamy cup of espresso in their car. This is very handy when you are rushing out of the door and have no time to stop at your favorite coffee place. The new gadget, HandpressoAuto, made by French company Handpresso is due to arrive in the US later this year (Christmas present?) plugs directly into the cigarette lighter of your auto. It takes two minutes for the portable machine (size of an average thermos) to deliver a cup of espresso. All you have to do is pour water into the thermos, place a coffee pod, hit the “on” button, and enjoy the hit of caffeine. The personal one presently retails for 150 euros.
Recently there have been a lot of complaints in various forums and on blogs that the homes they are viewing in the prime neighborhoods of Seattle are all “Grandma Houses”. I’ve seen this phrase used both in The Redfin Forum and on Seattle Bubble. People are asking what is meant by “Grandma’s House”.
Sunday from Noon to 3 p.m I will be at this home, which is clearly NOT “Grandma’s House”. It may be a “McMansion”…but it is NOT “Grandma’s House”.
Hope to see you Sunday.
If you ARE looking for “Grandma’s House”…I will be listing one of those in Maple Leaf near the end of April for about $120,000 less than this one.
-Central VA real estate news, trends and opinions » read more ..
“I’d love to use you as a realtor, but my brother is a Realtor in another part of the state and to not use him would not make much sense for me. It makes viewing houses a bit more inconvenient, but it’s family!” or … “She’s my sister; I have to use her!” “I didn’t need to look for representation; my uncle is a Realtor”
Could you/would you fire your aunt?
Candidly and respectfully, “he’s/she’s family” is one of the worst reasons to hire buyer representation I have heard.
Hiring someone to represent you in what is likely the largest financial transaction you’ll ever make warrants asking some questions other than, “what did you get me for Christmas last year?” (hint: here are quite a few questions to ask if you’re interviewing buyer or seller representation)
Buying and selling a home can be extremely emotional, sometimes volatile, and the process necessitates complete faith, trust and competence.
1 – “Family” doesn’t = competence. He might be the best damn agent in that market, but that market isn’t this market. I would *never* try to represent someone in Northern Virginia, Hampton Roads or Blackburg. While my Virginia real estate license says I can work statewide, but I’d likely be practicing malpractice if I were to do so. (besides, the Realtor Code of Ethics says I can’t**)
2 – This market is sooo much different than that market. And this market is different than the one he used to practice in; competence demands practice and practice demands productivity.
3 – How many homes are going in that development? What are the traffic patterns? How is the commute? Are those woods always going to be there? Where can I find out? If he’s not from here, he likely doesn’t know.
5 – Which house/neighborhood is going to be best for resale? This is an almost impossible question, but knowing the market certainly helps guide appropriately.
Look, I know it’s family. When I bought my first house, my mother represented me … but she was (and is) an active Realtor in this market. When my sister bought a house in Falls Church, she and her husband hired their own buyer’s agent … they might have run things by my mother and me, but they had their own representation.
1 – Do they work with a buyer broker agreement? (depending on “family’ doesn’t necessarily mean “it’s confidential”)
3 – How many buyers have they successfully represented* in the past 18 months? (if it’s less than 3; I’d be inclined to say they’re not experts in today’s market.
4 – Having a license and access to the MLS does not equate competence. While this is clearly applicable to any and all Realtors, it’s especially relevant when evaluating a family hire.
* The definition of “Successful” is not necessarily “represented to closing”; sometimes it’s successful representation is telling a buyer when to walk away.
** From the Realtor Code of Ethics, Article 11 -
REALTORS® shall not undertake to provide specialized professional services concerning a type of property or service that is outside their field of competence unless they engage the assistance of one who is competent on such types of property or service, or unless the facts are fully disclosed to the client. Any persons engaged to provide such assistance shall be so identified to the client and their contribution to the assignment should be set forth. (Amended 1/10
While I don’t think the Realtor Code of Ethics has any teeth of enforcement (it’s up to Realtors to report each other … ) it is something.
Home prices have fallen a whopping 34.4% from the peak set in July, 2006.
The housing market started off the new year with a thud. Home prices dropped for the fifth consecutive month in January, reaching their lowest point since the end of 2002.
The average home sold in that month lost 0.8% of its value, compared with a month earlier, and prices were down 3.8% from 12 months earlier, according to the S&P/Case-Shiller home price index of 20 major markets.
“Despite some positive economic signs, home prices continued to drop,” said David Blitzer, spokesman for S&P. “Eight cities — Atlanta, Chicago, Cleveland, Las Vegas, New York, Portland, Seattle and Tampa — made new lows.”
Can you believe all that you hear about the "Housing Recovery" Some of us wonder "What Recovery, its Housing Hype".
A slew of new housing data last week disappointed the analysts and the stock market, and all of a sudden you started to hear concern that maybe housing wasn’t exactly in a robust recovery.
From home builder sentiment to housing starts, to home builder earnings right through to sales of newly built homes, there was not one hopeful headline in any of it (except perhaps if you invest in rentals, as multi-family housing starts made more gains, but that is a contrary indicator to housing recovery).
Understanding the mindset of your high net worth clients is a high priority when you are marketing luxury real estate. The ability to temporarily step out of your own mode of thinking and see the world through they eyes is one of the keys to becoming a market leader. It is essential to maintaining any great relationship.
People take different routes to arrive at the same place. They solve problems from different angles. They see the world through different paradigms or frameworks of thought. Your ability to see their way and demonstrate that you can solve problems using their methodology can go a long way in gaining their trust. You do not have to abandon your own preferences in the process. Most people just want to be understood.
Here is an example of how it works. Remember word problems in math? Some of you might cringe at at the thought. But, try this one for fun.
If you have 8 balls of yarn and it takes 2/3 of a ball to make a scarf, how many scarves can you make with this much yarn?
Using typical mathematic methodology this can be accomplished by dividing 8 by 2/3, which is the same as multiplying 8 by3/2 (inverting the fraction 2/3 to 3/2 and multiplying), 8/1 x3/2 =24/2 or 12 scarves.
Someone else might that I can get at least 8 scarves out of this because it does not take a whole ball to knit one. That would leave a 1/3 ball from each of those 8 scarves, and I need 2 of those remaining 1/3 balls to make another one. Since I have 8 (1/3 balls left, I need 2 of those for each additional scarf. I can divide 8 by 2 and get 4 more scarves for a total of 12 scarves.
Both approaches get you to the same place. Which method is right? Which method is best? Is there only one way to get there? Perhaps you prefer one method over the other. But if you can understand how others think and are willing to demonstrate that you understand their approach, you will find that they are suddenly more receptive to understanding your way, too. This can translate into more listings and more closed transactions.
What’s the secret to lead conversion for a real estate professional? Actually, there really aren’t any secrets. All you need to do is look around the Internet. All the real estate coaches stress lead conversion. Tom Ferry tells...
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I hate shopping for clothes and shoes and anything else I need to wear. I’m not sure why, but it’s always been that way. Don’t change the channel. This post is not really about my view of clothes shopping! Maybe I hate...
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Looking for some inspiration for the new year? Don’t become a dinosaur — learn what all the cool kids are doing in real estate for the new millennium at the Inman Agent Reboot seminar on Wednesday, March 28th at Meydenbauer Center in Bellevue.
Yeah, you’ve got to cross the bridge to Bellevue, but it will be worth it.
You may already use Twitter, FB and other social media, but are you seeing results? Join Katie Lance, Social Media Director & Contributing Editor and Chris Smith, Chief Evangelist, & Contributing Editor, plus other exciting speakers and hear about the latest tech trends and what you can do to jump-start your business in 2012.
Want more information? Make sure you listen to this live interview on Monday, March 26th, of Katie Lance by the Bellevue Business Journal on Spreecast.
Is it difficult to manage real estate leads? Based on the feedback from real estate professionals I talk to, it is. And, there are a number of reasons why. The Problems 1. There’s Rarely Time to Develop or Maintain a Truly Effective...
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During the first 14 days of March, Greater Toronto Realtors reported 4,215 transactions through the Toronto MLS system, representing a 7% increase compared to the same period in 2011. The number of new listings was down by 2% year-over-year to 6,970.
"Home buyers continue to benefit from the affordable housing situation in the GTA. Immigration to Toronto and surrounding areas adds to the pool of home buyers every year. The economic and ethnic diversity found in the GTA consistently attracts newcomers and foreign investment,” said Toronto Real Estate Board (TREB) President Richard Silver.
The average selling price for transactions between March 1 and 14 was $502,155 – up by more than nine per cent compared to the first 14 days of March 2011. On average, homes sold for 100 per cent of the asking price within three weeks.
“Strong competition between home buyers in many parts of the GTA has resulted in sellers realizing their asking price in a short period of time. The fact that homes are selling for 100 per cent of the asking price, on average, suggests that sellers are very much in tune with the current market situation and know the fair market value of their home,” said Jason Mercer, TREB’s Senior Manager of Market Analysis.
Jay’s note: This week last year I came upon an horrific accident scene that I was certain involved my only son. Shortly after I wrote this someone, I can’t remember who now, said I should revisit it in a year. So here it is. “Personally, I’m going to make a concerted effort to stop taking things for granted. To appreciate life more. To not sweat the small stuff,” was a pledge made in this article. I’ve done OK with that. Certainly not perfect, but the memories of this day are still strong, and many times I’ve found myself getting spooled up over something that doesn’t really matter in the grand scheme of things. I stop, think of the day this happened, and move ahead to focus on what really matters. So read on; think about it. Read some of the comments from others sharing similar stories — and try focusing on what really matters.
Imagine this…
You are driving down the freeway at ten o’clock at night. Up ahead you see the flashing lights of multiple emergency vehicles and traffic slows.
“Great, an accident. All I want to do is get home…” you may be thinking.
As you approach the scene, you see a flipped over and mangled car.
A car of the exact make, model and unusual color of what your 19 year old son drives.
By the time you can cross two lanes of traffic and pull over, you are well past the accident scene. So you slam the car into reverse and drive faster in reverse that you’ve ever driven before. You get out of the car and run toward the accident.
The entire time, all sorts of thoughts are exploding in your brain. You’re praying like you never have before. As you get closer to the scene and see that yes, it looks exactly like your son’s car, you practically lose your mind.
Two police officers approach you – you the grown man who has been reduced to a blubbering incoherent pile of goo on the side of the road. Out of breath with your heart pounding you say something to the police. You’re not sure exactly what but it must have been some combination of “my son”, “his car”, and “dead” with a whole lot of “Please God no’s” in there.
The police offer puts his hands on your shoulders and all you hear is, “Your son? No, it’s a girl. It’s a girl’s car. Not your son. Not your son. There was no male in the car.”
“Are you sure?”
“We’re positive.”
A cop walks you back to your car and takes your keys. “You can’t drive like this,” she says. “I’ll be back in a few minutes.”
So you sit in your car on the side of a road, thanking God and Jesus that your son isn’t involved when it hits you that someone’s daughter is lying zipped up in a body bag 50 feet away. How can you be so happy, and so relieved, sitting so close to death? Guilt sets in.
And you really start to think about things.
Lots of things.
I sincerely hope you only have to imagine this scenario, and not actually experience it because believe me, it sucks. I know, because I went through it 20 hours ago.
It still disturbs me greatly.
An experience like this makes you think. It puts a lot of things in perspective. Life is fragile, and short. Too short to go around pissed-off at what really is, in the grand scheme of things, not-so-important. Hell, it’s practically immaterial.
We get mad about lawsuits. We get angry with the NAR. Maybe we’re frustrated by a client or fellow agents that don’t “get it”. We bitch and moan about having to work too hard. We get upset over a stupid social media “debate” at a conference. We yell at our kids, or our spouses. We fuel “blog wars”. We complain about the housing market, and the government, and how things “just aren’t fair.”
We need to stop and think. We need to put things in perspective. Well, at least I do. I can’t tell you what to do.
The bottom line is this: is all this crap really that important? Is it worth expending time, effort and energy?
I had a really shitty experience last night. For about two minutes (that felt more like two hours) I honestly thought my son was dead.
I wept. I cursed. I prayed. I think I might have thrown up. I don’t remember a lot of details as apparently my brain shut down in those adrenaline overdosed moments of shear terror and gut-wrenching panic. Shutting down was an instinctive reaction – and a good thing because I might have just lost my mind if I could remember everything during those moments.
And I felt sorry for myself for having to go through this experience.
Sorry for myself? There are people out there right now who did know and love the young lady in that car last night. Those people are experiencing infinitely more pain than what I went through last night.
They have something to be pissed-off about. They have the right to feel that things “just aren’t fair.”
When you get right down to it, all the trials and tribulations most of us go through on a daily basis are nothing. They are inconsequential. People like the friends and family of the young lady involved in last night’s accident, people like Clint and Angela Miller who are undergoing a torturous battle against testicular cancer, those people have something worthy of complaining about.
Us? Not-so-much.
I’m not trying to make light of anyone’s personal situation. I know times are tough out there for a lot of folks. I’m just suggesting that when you get upset, when you think the world is against you, when some person, some thing, some situation makes you angry, sad, bitter or hell-bent on vengeance, try taking a step back and putting things in perspective.
Personally, I’m going to make a concerted effort to stop taking things for granted. To appreciate life more. To not sweat the small stuff. I’m not saying that we should all join hands and sing Kumbaya – that’s not realistic, and perhaps not even healthy. It’s OK, good in fact, to be passionate about something. To be emotional. The world would be a pretty boring place if we all agreed with each other and no one voiced their opinions.
Maybe I’m being Pollyannaish, but it does seem like there is a lot of negative energy out there of late, a lot of bitterness, jealousy, and animosity. I know I am guilty as charged.
Perhaps it is time to step back and reassess priorities. Time to appreciate more fully all the goodness that life has to offer. To enjoy time with loved ones, or time alone.
Sitting on the side of the road last night made me think.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
What you are about to read may very well blow a few minds across the real estate Internet space. Or not. We’re about to find out…
Ready?
Earlier today, I accepted a full-time position with Zillow.
No, really. Soon I will be Zillow’s Director of Industry Outreach & Social Media.
Interesting, isn’t it?
Why? When? Where? What?
Why? In a nutshell, because I love a challenge, and I love working with ridiculously smart people. And trust me, this will be a challenge and Zillow is full of ridiculously smart people.
When? Soon, very soon. There isn’t an official start date yet because much needs to be done around here first. Primarily, the lovely Francy Thompson, Master of the Real Estate Universe and Queen of Brokerage Operations is going to be adding, “Designated Broker, Thompson’s Realty” to her job title.
I can’t work for Zillow full-time and be the DB of Thompson’s Realty, there just aren’t enough hours in the day. So Francy (who really has been “The Boss” since Day 1) is going to put even more work on her plate.
She’s a tough chick, she can handle it. Last night she enrolled in broker licensing classes (God help her) on the three-week plan. By the end of April she will have a freshly minted Arizona Broker’s License.
This isn’t a good time to get me started on everything that is wrong with being able to get a real estate broker’s license in three weeks — and actually, believe it or not, you can do it in 9 days. But people would die if she tried to complete it in 9 days. Hence the three-week plan. Here’s a post I wrote about my experience in broker licensing classes over 4.5 years ago. Whoops, I digress.
Francy will be the broker, Thompson’s Realty won’t really change for the foreseeable future, and I will be doing something completely different.
Where? My job at Zillow will require some travel, and a lot of time in Seattle (where Zillow is headquartered). For a long time now I’ve wanted to try out the “urban living” lifestyle – living right smack in the middle of a thriving and vibrant downtown community — and now is my chance. I’ll be renting an apartment in downtown Seattle (I’ve found several possibilities on, ahem, Zillow.com), and Francy will make frequent visits there and I will make frequent visits back here. This will be a big change for us, but we are both really excited about the opportunity.
What? Like “What the heck is he thinking?” or “What the heck will he be doing?” What I’m thinking is I have an opportunity to work with an amazingly talented team in a sector of the real estate space that has always fascinated me. While it may seem odd to some to give up control of a successful real estate brokerage, sometimes you have to take a big leap into something different and just follow your passions.
I have always loved education and training, and if you’ve followed any of my travels about the interwebs it should be no surprise that I am a bit of a social / new media enthusiast. I think — strike know — that I can help Zillow progress, improve and grow as well as help agents all across the country understand and develop their business. And Zillow and those agents can help me do the same.
But, it’s Zillow…
Believe me, I know what some agents think of Zillow. I got yelled at on the NAR Annual trade show floor for wearing a Zillow t-shirt (which BTW is too small now. Wonder if I can get a new one? Or a hoodie!). Granted, I have freely admitted that I don’t fully understand the fear of Zillow some seem to have (I wrote this almost five years ago. And this, over five years ago). I think it’s mostly the unknown. Or the misunderstood. So what say we try to fix that?
I have written about Zillow since they launched. I’ve met many people that work (or worked) for Zillow and consider some of them good friends. So why not join the Zillow team and see if we can’t just change some perceptions and help out some agents and brokers? I think we can. And I can’t wait to start.
The bottom line is this — I’ve pondered this change long and hard and decided why not follow my passions and see where they take me? Life is a journey, and this is just one more step along the path.
Mark Twain may have said it best…
20 years from now you will be more disappointed by the things you didn’t do than by the one’s you did. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.
It’s time to explore, dream and discover!
As always, your thoughts and comments are appreciated. Don’t be shy!
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
It doesn’t happen very often, but occasionally a home seller will decide that they don’t really want to sell their home after all.
What can they do?
If your home is only listed for sale and there isn’t a pending offer, then you can cancel your listing agreement. Maybe. It depends on the brokerage you have listed your home with and how your listing agreement is written.
Thompson’s Realty will let a home seller cancel their listing agreement with no strings attached. We realize that sometimes situations change. Be advised, not all brokerages will let you cancel a listing agreement. You should be able to at least take your home off the market. Check your listing agreement. Some brokerages may charge you for expenses they have incurred to market your home. Your options should be spelled out in your listing agreement. Read it carefully…
What if my home is under contract for purchase?
Well, you’ve got a problem. The purchase contract you signed is a legally binding agreement to sell your property under the terms of the contract. Breaking such a contract is generally considered a breach of contract:
Breach of contract n. failing to perform any term of a contract, written or oral, without a legitimate legal excuse … Breach of contract is one of the most common causes of law suits for damages and/or court-ordered “specific performance” of the contract.
Ugh. Law suits for damages. Court orders. Sounds expensive, and it is.
What is the home buyers recourse if you breach your contract and decide not to sell your home?
Typically the home buyer will seek court-ordered relief in the form of “specific performance”. In short, they take you to court and ask the judge to force you to uphold your end of the deal. And the vast majority of the time, they will get exactly that. Should you fail to sell the home after the judge tells you to, well now you are looking at contempt of court charges and all the fun and expense that entails. In this case, you might not need your home anyway as you may well have a new place to stay in The Big House.
Specific performance n. the right of a party to a contract to demand that the defendant (the party who it is claimed breached the contract) be ordered in the judgment to perform the contract. Specific performance may be ordered instead of (or in addition to) a judgment for money if the contract can still be performed and money cannot sufficiently reward the plaintiff.
Here is a great article, written by an attorney, with more information on specific performance.
The vast majority of the time, a seller being sued for specific performance is going to lose. After all, you entered into a contractual agreement to sell your home. The buyer has more than likely paid out of their own pocket for inspections, an appraisal, and possibly some mortgage fees. In addition, they may have sold their own home, or arranged to terminate their lease. Not to mention that they stopped looking for a home because you promised to sell them yours. Your real estate agent or the buyer’s agent might even be able to come after you for commissions due since they procured a willing, able and ready buyer for your home.
Occasionally a seller might win a specific cause complaint, but typically that only happens if the seller can’t sell the home. Not because they don’t want to, but because they can’t — as in they no longer can convey clear title.
Any other options?
You could always try asking the buyer if they would agree to a mutual cancellation of the purchase contract. It’s pretty unlikely that will fly because, as previously mentioned, the buyer already has significant monetary “skin in the game”. Maybe if you agree to reimburse them for their costs, and maybe if they are getting cold feet and/or are the nicest people on the planet then they might agree to a mutual cancellation. In the current Phoenix real estate market where many buyers have submitted offers on multiple homes, only to have their hopes and dreams dashed by being outbid, I think that it is pretty unlikely that a home buyer under contract is going to say, “No problem. I’ll just go back to the stress and pressure of finding another home”.
If you do manage to get a buyer to agree to a mutual cancellation, I would strongly suggest having an attorney draft the cancellation agreement so that you are ensured the buyer can’t come back later and sue for specific performance anyway.
In short…
If you are a seller looking for a way out of selling your home, you need to speak to an attorney. Breach of contract can have serious legal and financial implications. Don’t screw around with it. Your agent probably isn’t an attorney. Seek your agent’s advice (which should be, “speak to an attorney…”). If your agent says, “Eh, no big deal, happens all the time!” then… well, good luck. You’re going to need it (and a healthy checking account balance as well).
Disclosure: I am not an attorney, in any way shape form or fashion. And an attorney is exactly who you need to be speaking to if you’re considering breaching your home sale purchase agreement. The above is based on my professional experience. Laws and real estate purchase contracts vary by state and possibly city. Get off the Internet now and find an attorney if you are considering breaching a contract.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
We dug into the numbers on the Estately blog to see if we could make sense of the Seattle real estate crunch we’ve been hearing so much about. The summary: the market looks healthier this year than in the previous two and, in the first week of March, a whopping 1 in 3 homes sold for above the original listing price. We are looking at homes (not condos or townhomes) in Seattle and King County (excluding Seattle).
The numbers paint the picture of a recovering market:
1. Increasing numbers of homes sold, year-over-year…
Pay no attention to the silly article title. It’s purely a play on what is making news today.
Yep, even the Phoenix real estate stuff, though it is buried under the earth-shattering and life-changing news about “the latest new iPad” (apparently it’s real name) and Peyton Manning and a bunch of… people… trying to get elected.
While all that is going on, the Phoenix housing market is picking up steam.
Just ask anyone currently looking for a home in Phoenix.
Just ask any real estate agent with a listing. Or with buyer clients.
One of our agents activated a new listing last night at Midnight. She just told me the calls, emails and text messages from buyer’s agents started at 7:00am. And there is already an offer submitted on the home — that the potential buyer has never seen. That buyer agent is attempting to apply pressure for the seller to accept their offer; because they know more offers will be rolling in shortly.
It’s like 2005 all over again…
It’s crazy out there! Insanity. A veritable feeding frenzy.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
In the following press release the Metropolitan Police (London, UK) announced that a fraudulent mortgage broker has been sentenced to two and a half years in prison following an investigation by financial investigators from the Metropolitan Police Service.
Olakunle Okubote (left), 50ys - 03/11/1961, of Broughton Avenue, Finchley N3 3EH was jailed and forced to hand over more than £23,000 on 24 February, following a five-week trial at Wood Green Crown Court.
“I am pleased the prosecution team were able to successfully conclude the criminal proceedings.”
The investigation began in 2008 when London Crime Squad identified a mortgage broker with a lavish lifestyle in a million pound property in Finchley, North London. He owned a Bentley and Land Rover. As a result, Territorial Policing Payback Unit commenced with a proactive financial investigation into the affairs of the broker, subsequently identified to be Olakunle Okubote trading as ‘First Channel’.
The mortgage broker assisted criminals to obtain mortgages providing them with false documents and information. He secured cash discounts on new builds, which he kept, with the knowledge of the conveyancing solicitors, ranging between £10,000-£20,000 on each property.
The lenders and borrowers were unaware, which resulted in the borrower obtaining a mortgage larger than the purchase price. He concealed his activities by transferring funds between bank accounts in various names and identities. The documents were verified by other brokers, believed in an attempt to conceal his involvement.
Okubote received £15,000 after securing a mortgage for Michael Kolawole. That person was identified to have been imprisoned for 18 years in America in the name of Kola Ajibade for Drug Trafficking.
Akin Olojo was arrested by the Territorial Support Group, based in Finchley, in possession of about £2,000 cash.
TSG Payback Unit commenced with financial enquiries into Akin Olojo’s financial affairs and discovered that he had obtained mortgages in two different names, one of which contained false employment and identity documents, brokered by Okubote.
Hertfordshire Police arrested two others in a connected prosecution, who had a mortgage brokered by Ola Okubote.
All of these investigations were joined, and enquiries were undertaken into the mortgage broker’s affairs.
The conveyancers have been independently dealt with by the Solicitors Regulatory Authority.
Olakunle Okubote, Michael Kolawole (aka Kola Ajibade) and Akin Olojo (aka Akin Latunji) were convicted after a five-week trial at Wood Green Crown Court.
Michael Kolawole, 51ys - 13/06/1960, of Winchester Close, SE17 was imprisoned for 12 months. He was ordered to pay £2,000 costs and a confiscation order is ongoing.
Akin Olojo, 28ys - 26/11/1983, of Foyle Road, N17 received a suspended sentence on the 13 January 2012. He was ordered to pay £2,000 costs and a confiscation order is ongoing.
Further civil proceedings are underway to remove all the other available assets from Okubote, whose assets are restrained.
Detective Sergeant Jason Aldridge, in charge of the investigation, said:
“Olakunle Okubote was a confident criminal. I am pleased that the prosecution team were able to successfully conclude the criminal proceedings, under the leadership of Jonathan Wright from Castle Chambers.
“We plan to take away all their available assets through confiscation and civil recovery to ensure that every available asset is taken away from these individuals.”
In the following press release Zane David Memeger, United States Attorney for the Eastern District of Pennsylvania announced that Robert Coyle, Sr., 66, of Glassboro, New Jersey, was charged today by Indictment with four counts of loan fraud, announced United States Attorney Zane David Memeger. Coyle owned and/or rented more than 300 properties in Philadelphia and operated a real estate business out of 2332 E. Allegheny Avenue. Among his business entities were Landvest, LLP, Alivest, LLP, and Otay, LLC, to name few.
Robert Coyle, Snr - Coutesy of Philly.comAccording to the Indictment, Coyle, through his business entities, borrowed more than $3 million from East River Bank (“ERB”) and more than $6.6 million from Republic First Bank (“RFB”). Polonia Bank was a 49% participant in the ERB loans after settlement. The purpose of the loans was purportedly to refinance existing loans, make improvements on some of the properties Coyle owned, and/or to allow Coyle to pursue other real estate opportunities. Coyle pledged approximately 71 properties to secure the ERB loans and approximately 117 other properties to secure the RFB loan. The banks anticipated that the loans would be repaid through rental income that Coyle was collecting and, if necessary, through the sale of the collateral properties.
But the indictment alleges that Coyle did not hold good title for all of the properties he pledged since he had entered into various ownership agreements with the then current occupants of several of the properties. In addition, in submissions to the banks prior to settlement of the loans, Coyle allegedly inflated the amount of rent he was collecting on some of the properties and listed vacant properties as occupied. The indictment further alleges that Coyle submitted to the banks forged leases and fake letters to tenants that purported to raise their rent. The alleged fraud on the banks is more than $10 million.
If convicted the defendant faces a maximum possible sentence of 120 years in prison, five years of supervised release, $4 million in fines, and a $400 special assessment.
The case was investigated by the Federal Bureau of Investigation and the Economic and Cyber Crimes Unit of the Philadelphia District Attorney’s Office and is being prosecuted by Assistant United States Attorney Mary Kay Costello.
In the following press release on Monday, March 5, 2012 Duval County (FL) Sheriff Rutherford announced the arrests of three suspects [Rhonda Johnson (R), Cleveland Stevens (L), and former Mayoral Candidate Warren Lee]. All four are alleged to be involved in a long-term investigation into squatters who [occupied and] then leased out residential properties they did not own.
Currently there is an active warrant out for outstanding suspect, Marcellous Dunbar (no picture).
Photo’s courtesy of Jacksonville Sheriff and Jacksonville.com (Lee).
The Sheriff’s press conference can be seen below.
A video news report from First Coast News can be seen below.
Anyone with any information about the whereabouts of this outstanding suspect or similar crimes taking place is asked to call the Jacksonville Sheriff’s Office at 904-630-0500 or email us at JSOCrimeTips@jaxsheriff.org. To remain anonymous and receive a possible reward, contact Crime Stoppers at 1-866-845-TIPS or email them at rewards@fccrimestoppers.com.
Now, there is controversy over Pinterest and the exposure users could have to being sued. Did you read every word of Pinterest’s terms of service? Uh, no, I didn’t either. But, if any of us actually did that, we’d discover...
***Visit the BRER Real Estate Marketing Blog to get the rest of the story!***
Greater Toronto Realtors reported 7,032 sales in February 2012 – up 16 per cent compared to February 2011. New listings were also up over the same period, but by a lesser 11 per cent to 12,684. It is important to note that 2012 is a leap year, with one more day in February. Over the first 28 days of February, sales and new listings were up by ten per cent and six per cent respectively.
“With slightly more than two months of inventory in the Toronto Real Estate Board (TREB) market area, on average, it is not surprising that competition between buyers has exerted very strong upward pressure on the average selling price. Price growth will continue to be very strong until the market becomes better supplied,” said Toronto Real Estate Board President Richard Silver.
“It is important to note that both buyers and sellers are aware of current market conditions. This is evidenced by the fact that homes sold, on average, for 99 per cent of the asking price in February,” continued Silver.
The average selling price in the TREB market area was $502,508 in February – up 11 per cent compared to February 2011. The Composite MLS® Home Price Index for TREB, which provides a less volatile measure of price growth compared to the average price, was up by 7.3 per cent compared February 2011.
“If tight market conditions continue to result in higher than expected price growth as we move into the spring, expectations for 2012 as a whole will have to be revised upwards,” said Jason Mercer, TREB’s Senior Manager of Market Analysis. “While price growth remains strong, the average selling price remains affordable from a mortgage lending perspective for a household earning the average income in the GTA.”
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
Hello Phoenix Real Estate Guy. Can you tell me why you have my listing on your web site?
The short answer is because YOU authorized it when you entered the listing.
Apparently though, there are a number of real estate agents and even Designated Brokers that do not understand IDX (Internet Data eXchange).
How it is possible in this day and age for agents to not understand the fundamentals of IDX is mind-boggling. That Designated Brokers don’t understand it is… well, it’s incomprehensible. Yet many don’t seem to get it.
Given that, here is the long answer…
What is IDX?
IDX is the system and technology that allows agents and brokers to share real estate listings on IDX enabled websites. There are, according to ARMLS (Arizona Regional Multiple Listing Service), “thousands of Broker/Agent Websites that display ARMLS IDX listings on the Internet”.
So you see, not only is your listing displayed on my site, it is also displayed on thousands of sites in the Phoenix metro area (as well as national listing aggregation sites).
And that’s a good thing, right? I mean you are trying to get your listing sold aren’t you? You found your listing on my site — and so can potential home buyers. In marketing-speak that is called “exposure”.
But what if I don’t want my listing shown on other websites?
Easy-peasy, just opt out of IDX. You have two options:
In ARMLS, agreeing to display your listings via IDX is the default. If you don’t want your listings displayed on other IDX enabled real estate sites then you need to opt out of the program.
Option 1
For individual listings you can opt out of IDX by UNchecking a box when you enter the listing in the MLS. Here is a screen shot of the ARMLS listing entry “Export” tab:
See where it says, “Listing Export Options”? And under that is a checked box labeled “IDX”? Just uncheck that box, click save and that particular listing will not be sent out in the IDX data feed to thousands of web sites. I’d be sure to disclose to your seller however that your marketing plan includes removing their listing from those thousands of websites. They’ll probably want to know that.
Option 2
If you are a Designated Broker, you can complete an opt out form and submit it to ARMLS to have ALL of your current and future listings removed from the IDX feed. Of note, opting out of IDX completely also means that you cannot display other brokerages listings on your IDX enabled real estate site.
There you have it
*I* can’t remove your listing from my site. You authorized it to be displayed on my site, so only you can have it removed from the data feed that puts it here. If you don’t want your listing exposed to potentially thousands of prospective home buyers, go into the MLS listing and uncheck the box, or opt-out of IDX altogether. Just remember, you owe it to your sellers to explain what you are doing, and why you are doing it.
Of Note: Both IDX providers that we utilize on this website (Diverse Solutions and FlexIDX) are authorized and approved by ARMLS and are fully compliant with all ARMLS IDX rules and regulations. If you have heartburn over how listings are displayed here, you need to take that up with ARMLS. We don’t change or manipulate the authorized IDX displays in any way, form or fashion.
Further Reading:
I strongly recommend reading the following web page and document. They explain IDX in detail. You owe it to yourself and your clients to fully understand how IDX works — it’s a HUGE part of Internet marketing in real estate.
Originally posted on Phoenix Real Estate Guy. If you are reading this anywhere but inside your RSS feed reader or your email client, the site you are on is guilty of stealing content.
I started a new hard money loan this week, bringing my current outstanding loan count to 4.
This one is on a single family home in San Pablo. It is currently occupied. It's a 2 bedroom, 1 bath, 856 square foot home built in 1950. The roof and foundation look to be in good shape and, other than the garage, the paint is in good shape. We were unable to see the inside of the home, but pictures of the interior on MLS show it seems to be in good shape. The landscaping is in good shape too. It appears to have newer windows and the kitchen has been redone with granite and stainless steel appliances.
The property was listed as a short sale on the MLS at $175,000. There is another property down the street, similar in size and condition, that is also listed as a short sale for $175,000. It sold in seven days, but we don't know what the actual contract price was since it was a short sale. The neighborhood is just OK. My partner's helper rates it a "C". The property is near a large regional park, so there aren't many nearby houses for comps. The original owner bought the property in 2004 for $378,000. There was competition at the auction for this property, so other investors wanted it. Our borrower got it for $129,000. Our loan is for $105,000. We conservatively are valuing it at $160,000. That makes our LTV 65.6%. My investment in this property is smaller than normal, since it's being done with funds from my daughter's UTMA account, as I mentioned a couple weeks ago.
There was a time (when I was active) everyone I know seems to know "someone" who is in real estate. Mom, friend, niece, nephew, relative.. all sorts of relationship labels. Just because you know this person via a person close to you, doesn't mean that this agent is good for you.
So how can you tell if your agent is right for you? Washington Post Express got it down to a few things important when you're looking for someone to represent you (buying or selling).
Patience and personality.
Demeanor is a huge part of what makes an agent great (or awful)
Good communication skills, an encyclopedic knowledge of the area, self motivation, honesty and tech savvy.
In this day and age of Internet and social media, "agents use of online tools is more important than certifications they have," says Jon Heithaus, CMO of Metropolitan Regional Information System.
An open letter to the National Association of Realtors members from one of our readers.
Dear REALTORS,
With their latest press release, it seems that the National Association of REALTORS has completely given up being a credible source of housing data. Therefore, I would strongly advise against using any of their data or information that they disseminate from their offices. And I would definitely not cut and paste their propaganda into anything you send out to clients and customers via blogs, Facebook or any other social media platform. It will almost certainly turn out to be incorrect if not completely fabricated.
The press release claims that sales have increase 4.3% in January. This might be true but that is highly unlikely. Why do I say that? Because last month they reported sales increased 5% in their initial press release. However, this was actually not the case as they readjusted the number for December during the current month to actually show a decrease in December sales of .5%. So either they are massaging the numbers to tell the story they want to tell or they are incompetent. I will go with the former.
So don’t be surprise in March when they report February sales and adjust January down., there is a chance the number you are quoting today will be absolutely incorrect. And it is funny but it always seems to be adjusted down. That is how a propaganda machine works. One direction. Late last year they had to adjust sales for 4 entire years worth of data. The adjustment was 14% down. No surprise there. What was the reason the data was so wrong for so long? Drift. That is what Lawrence Yun, Chief Spin Doctor for the NAR called it. Another WTF moment.
The NAR can no longer be trusted by us. It is therefore our responsibility to report the correct numbers for our individual markets. And we should do so with honesty and integrity. No spin. No propaganda. No Drift. It is well known by everyone that each real estate market has its own characteristics. Real estate is truly local. I am of the belief that reporting any national numbers for real estate sales is confusing at best and destructive at worst. But until the leadership of NAR is changed and propaganda is no longer tolerated, we must fight to maintain our credibility despite the actions of NAR.
Tony Arko
President, Dulles Area Association of REALTORS
Un-Proud NAR member since 2004
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
Developed using data from the Multiple Listing Service®, the MLS® Home Price Index (or MLS® HPI for short) allows you to see trends in home prices for a specific type of house in a given neighbourhood. The Home Price Index will allow you to better understand real estate market trends — and how they can affect the market value of your home.
More importantly, it helps you approach one of life’s most important decisions — buying or selling a home — with greater confidence.
The MLS® HPI is calculated using a sophisticated statistical model that takes into account a home’s quantitative (e.g., the number of rooms it has) and qualitative (e.g., whether it has a finished basement) features.
The MLS® HPI approach provides a less volatile measure of price than averages and medians, which can swing dramatically in response to changes in the share of very expensive or inexpensive home sales from one time period to the next.
Each month, there will be two key outputs published using the MLS® HPI:
1. A series of price indices – The MLS® HPI price indices work in a similar fashion to the Consumer Price Index (Canada’s measure of consumer price inflation). The indices have a base month/year of January 2005, where the indices are equal to 100. In January 2012 the TREB’s composite HPI was 143.1. This means that the composite price index grew by 43.1 per cent between January 2005 and January 2012.
2. A series of benchmark home prices – The MLS® HPI has also been used to establish benchmark homes down to TREB’s Community level of geography for major home types including single family (detached and attached, townhouses and apartments). A benchmark home is composed of a set of attributes typical of homes in the area where it is located, and remains constant over time. This allows for an apples-to-apples comparison of price over time.
As Another Investor predicted about 2 hours before it actually happened, investors in the Houston apartment complex got a request to contribute more cash. The management company is asking for a total of $250,000 more from investors to make it through the year.
Management sent out budget projections for 2012 through 2014. The projections assume the complex will be sold at then end of 2014. (The original plan at purchase was to look at selling the property after 5 years, or in 2013.) Also, buried in a footnote, it says the projection also assumes no distributions of cash flow will be made to investors during 2012, 2013, and 2014. The monthly projection for 2012 shows the property losing money each month until June, when it returns to profitability for the remainder of the months of the year. Still finishes the year with an overall loss though.
The analysis also includes a look at the Houston economy and apartment market. In short, its been a very bumpy ride. Unemployment drops for a few months, then shoots back up one month, then drops for a couple more months. Occupancy at the property has consistently trended about 3 percentage points higher than the Houston apartment market in general, so that's one positive. However, that appears to be a result of having rents about $10 to $35 lower per unit than the market average.
Management predicts 2012 will be a turnaround year and the property should achieve breakeven status mid-year and return to profitability for 2013 and 2014. Management continues to defer their management fees to help keep expenses down. (Their contract gives them a percentage of the profit when the property sells, so they have a vested interested in getting the property back in the black.) The property itself is in good physical condition and should benefit from an improving economic environment.
Looking at selling the property at the end of 2014 using a 6.5% cap rate, they figure investors will get an annualized ROI of 10.77% on their initial investment. Just for the heck of it, I went back and looked at the original projections made at the time of purchase. The sale price after 5 years was $2 million higher than the current sales price projection and the investor's ROI was 20%.
Of course, management is trying to paint a rosy picture. Everything pretty much depends on the Houston economy picking up again. It looks like it is on the mend, but it is a very slow process which seems to be subject to frequent setbacks.
So.. Where does that leave us investors? Management says the property is operating very close to break even and with an additional $250,000, should be able to make it through 2012, after which they see the economy picking up. Investors are being asked to contribute a pro-rata share of $250,000 based on their initial investment amount. The investment was sold in $50,000 blocks, so they are asking for an additional $4,545 per block that you own. Investors are not required to contribute more, but if they do not, management warns that "alternative financing sources will be considered," which may or may not be available and will probably come with high interest rates and/or investment participation (meaning the lenders would become part owners of the property in exchange for lending funds). If any members do not fund their pro-rata share, the members that are contributing more will be contacted to see if they are willing to make up the shortfall before any alternative funding is obtained. Of course, everyone's ownership percentage will be adjusted to reflect any additional capital input. And should all that fail, losing the property to foreclosure is a possibility.
I think I'm going to pass on this. I might have contributed had the projections included some cash flow back to investors at some point, but it doesn't. I've always looked at this investment as a capital gains play. While I do appreciate the potential capital gains, over the past couple of years investing, I've realized I enjoy cashflow more than capital gains and I believe I can put my funds to better use elsewhere. That said, there are risks involved with not providing the additional funding. If the other investors do not step up, management might be forced to get a loan at a high interest rate, further reducing profits and increasing the time it takes to turn the property around. Or, they might need to give up some ownership of the property, which would reduce my share and hence, my return on my investment. And foreclosure is always a possibility, although I seriously doubt it will come to that.
This is not something that will only be asked by native New Yorkers to the rubes visiting from out of town.
Instead, Empire State Realty Trust, owners of the Empire State Building have announced it will take the company public. Yes, you too can own the most iconic building in Manhattan.
Empire State Realty Trust, owners of the iconic Empire State Building, filed to sell up to $1 billion of its Class A common stock, giving ordinary investors a chance to own a piece of the building that has been fought over by billionaires.
The tower, once the tallest in the world, has seen several owners over the decades and had been at the centre of a legal battle among the Malkin family, property tycoon Donald Trump and real estate heiress Leona Helmsley.
The Malkin family bought the property in 2002 and, after much wrangling, gained total control of the 102-story building in 2010.
In November, Malkin Holdings had said it would likely file to become a publicly traded real estate investment trust within three months.
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Wow.. I can’t believe I haven’t updated this blog since December! Truth be told, there isn’t much happening. My three outstanding hard money loans continue to pay on time. I haven’t received an update on the Houston apartment since last time, so there isn’t a whole lot to tell there. I’m assuming performance of that still sucks or we would have heard something. I did make a decision to go a bit further into hard money lending. I’ve got some money in a UTMA account for my daughter that has been languishing in the stock market for the past 5 years. I finally got fed up with seeing it sit there doing nothing and have liquidated the stocks and will be switching those funds to HMLs as soon as the trades settle and my brokerage can get me a check. I have noticed in the paperwork I get for some of my existing loans (trust deeds and recorded docs and such), other people I lend with have done the same thing.
In somewhat-related news, my self-directed IRA is getting up there in value. I think in the next couple of months, I’ll split that investment into two loans just to provide a bit of diversity. It’s not diversity in the stock market sense of the word, as both loans will be in the real estate sector and the same geographic area (probably), but the loans will be on two different properties, possibly with two different borrowers. I need a couple more months of interest payments before doing this though, in order to satisfy the minimum balance requirement for my bank account before I withdraw the funds.
The market seems to be picking up in the California Bay area. My partner says for the first time in a long time, he has more requests for loans than money to fund them.
The meme has hit the real estate world, courtesy of Brian Copeland and Maura Neill the folks at RETSO.
See home many real estate memes you can find…
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In the following press release Cuyahoga County Prosecutor Bill Mason announced that Blaine Murphy (aka Bryce Peters, III and Martin J. Franks) and Bryce Peters Financial Corporation, Inc. were indicted on charges of illegally “flipping” 235 houses in Cuyahoga County by filing forged deeds to these properties. Murphy, 43, of Naples, Florida, forged the deeds as an individual named Bryce Peters, III. The indictment includes properties located in 14 other Ohio counties.
Murphy (pictured left) was the key participant in this nationwide enterprise that includes real estate in many states with the most activity occurring in Ohio, Michigan, Pennsylvania, Missouri, and Texas. From 2005 to 2010, the purpose of the enterprise was to make a quick profit by selling houses in Cuyahoga County, and the enterprise did so by filing forged deeds and engaging in related conduct. Of the 235 houses sold in Cuyahoga County, 186 properties were in Cleveland, 31 properties in East Cleveland, 5 properties in Warrensville Heights, 4 properties in Euclid, 3 properties in Cleveland Heights, 3 properties in Shaker Heights, 2 properties in Maple Heights, and 1 property in Garfield Heights. 96 properties fell into Tax Foreclosure for a total tax delinquency of $1,032,849.84.
Murphy and his company were indicted on charges of engaging in a pattern of corrupt activity (RICO), possessing criminal tools, money laundering, and tampering with records. Murphy is also indicted on charges of acting as an officer of an unlicensed foreign corporation, and operating an unlicensed foreign corporation. The indictment seeks forfeiture of the 79 properties currently owned by Murphy’scompany. This is the first time a “houseflipper” has been charged for using fictitious identifications to forge deeds and other documents.
The enterprise existed in two phases. First, acquisitions were made with little or no regard for the condition of each property. In his quest to make a fast profit, Murphy ignored property code violations and payments of taxes at the expense of these communities in Cuyahoga County. Secondly, Murphy sold these properties in bulk or individually for a quick profit to various buyers, essentially in the same manner as these properties were acquired.
The forgeries hid the real identity of Murphy and made it difficult, if not impossible, for communities in Cuyahoga County to make contact with the individual or individuals responsible for the condition and maintenance of the properties. In an attempt to combat repeated housing code violations, Cleveland Municipal Housing Court Judge Raymond Pianka held Murphy and his corporation in contempt of court and levied fines for failure to appear in the amount of $9.5 million dollars. These forgeries aided the defendants in avoiding detection. The Cleveland office ofthe FBI investigated this matter in cooperation with the Cuyahoga County Prosecutor’sOffice.
Cuyahoga County Prosecutor Bill Mason said, “Cuyahoga County has brought to justice an individual who is responsible for causing millions of dollars in damages and ruining whole neighborhoods across Ohio and the Midwest. Today is a triumph of justice over greed.”
The investigation of others who aided and abetted Blaine Murphy (aka BrycePeters, III – aka Martin J. Franks) and Bryce Peters Financial Corporation, Inc. continues.
In the following press release Carlie Christensen Acting United States Attorney for the District of Utah announced that a federal grand jury returned a 19-count superseding indictment Wednesday evening charging Portia R. Louder, age 40, and Chad Louder, age 42, both of Highland, with violations of federal law in connection with what the indictment alleges was a scheme to profit from loans fraudulently obtained from mortgage lenders. The superseding indictment also adds Portia Louder’s brother, Dustin Wilcox, age 35, of Highland, as a defendant in the case.
In the initial indictment returned in October 2011, Portia Louder was charged with three counts of false statements to financial institutions; three counts of wire fraud; and one count of money laundering. Chad Louder was charged with two counts of false statements to financial institutions. The initial indictment focused on three homes in Alpine, Draper, and Highland.
The new indictment, which adds four additional properties to the alleged scheme, charges Portia Louder with five counts of false statements to financial institutions; eight counts of wire fraud; three counts of money laundering; and one count of conspiracy. Chad Louder is now charged with four counts of false statements to financial institutions; four counts of wire fraud; three counts of money laundering; and one count of conspiracy. Wilcox faces one count of false statements to financial institutions; two counts of wire fraud; two counts of money laundering; and one count of conspiracy.
According to the indictment, the defendants targeted expensive homes for purchase. They looked for homes being sold by owners and often those that had not been listed on the Multiple Listing Service. This way, the indictment alleges, the defendants could, through the substitution of nominees and straw parties, raise the purchase price of a home without the lender’s learning of the sales price set by the owner. The indictment focuses on the purchase of seven homes in Alpine, Draper, and Highland.
According to the indictment, after finding a home to purchase or have purchased, the defendants offered to purchase the home at or near the seller’s asking price. The defendants, the indictment alleges, typically told or had someone tell the seller that there was a new buyer for the property who would purchase the home for substantially more than the original sales price, but that the original seller would get only the price agreed upon between the seller and a defendant or a nominee. Portia Louder typically used a straw party or nominee to form a joint venture with the original seller of a property. The joint venture, acting at the direction of Portia Louder, would become entitled to a payment from the loans eventually obtained at an artificially inflated price.
Portia Louder, according to the indictment, commissioned appraisals on properties even though she often was not listed as the purchaser or the seller. The indictment alleges she paid as much as $5,000 for an appraisal even though an appraisal on an average home would often cost $500 or less and an appraisal on a high end home often cost about $1,500. During 2006 through 2007, the indictment alleges she paid about $380,000 to appraisers.
By concealing the initial sales price, the defendants were able to artificially increase the prices of the homes disclosed to lenders. For example according to the indictment:
The sellers of a property on [997] West Pfeifferhorn Drive in Alpine received $1,340,000 in June 2006 and the transaction closed for $2,205,000.
The sellers of a property on [6021] Dry Creek Circle in Highland received $1,500,000 in September 2006 and the transaction closed for $2,500,000.
The sellers of a property on [1747] Sage Hollow Drive in Draper agreed to sell for$1,095,000 on or about September 2006, and the transaction closed for $2,700,000 in April 2007.
The sellers of a home on [354] Deerfield Drive in Alpine agreed to sell forapproximately $839,000 in January 2007 and the transaction closed in March 2007 for$950,000.
The sellers of a home on [891] Healy Homestead Circle in Alpine agreed to sell for$900,000 in May 2007 and the transaction closed for $2,300,000 in July 2007.
The sellers of a home on [381] East Wayne Court in Alpine agreed to sell for approximately $725,000 in late 2007 and the transaction closed for $1,585,000 in December 2007.
The sellers of a home on [1814] Somerset Ridge Drive in Draper received $1,115,000 in December 2007 and the transaction closed for $2,400,000.
The indictment alleges Portia Louder recruited straw purchasers, including the defendant Chad Louder, as well as others, to submit applications to obtain mortgages on the properties listed in the indictment. These mortgage loan applications were false and fraudulent because, at times, the buyer was a straw buyer not purchasing the property for himself or herself but at the direction of Portia Louder so she could inflate loan proceeds from mortgage lenders; the straw buyer had not made a down payment or invested his or her own funds, transferring all of the financial risk in the purchase and loan transaction to the mortgage lender; the straw buyer was to be paid a kickback from the loan proceeds as an inducement to apply for the loan; the straw buyer had no intention of living in the house or making loan payments; the straw buyer had a materially smaller income than represented on the application; and the loan closing documentation created the false appearance that the straw buyer had made a down payment to purchase the property – among other things.
The indictment includes a notice of intent to seek criminal forfeiture in the amount of $3,900,000 million in currency received and diverted by Portia R. Louder in connection with the conduct alleged in the indictment. Prosecutors are seeking $2,450,000 million in currency received and diverted by Chad Louder and approximately $2,160,000 from Dustin Wilcox.
The potential maximum penalty for false statements to a financial institution is up to 30 years with a potential fine of up to $1 million. Wire fraud carries a potential penalty of up to 20 years in prison and money laundering is up to 10 years in prison. Conspiracy carries a potential penalty of up to 10 years in prison. These counts have potential fines of up to $250,000.
Indictments are not findings of guilt. Defendants charged in indictments are presumed innocent unless or until proven guilty in court.
The case is being investigated by special agents of the FBI and IRS Criminal Investigation and prosecuted by Assistant United States Attorneys in Salt Lake City.
In the following press release B. Todd Jones, United State Attorney for the District of Minnesota announced that in federal court, a 66-year-old Bloomington man was sentenced in connection with his participation in a $2.5-million mortgage fraud scheme that involved the sale of condominiums in the Sexton Lofts building in downtown Minneapolis.
United States District Court Judge Patrick J. Schiltz sentenced Gerald James Greenfield to 50 months in prison on one count of conspiracy to commit money laundering and fined Greenfield $10,000. In addition, Judge Schiltz ordered Greenfield to forfeit to the United States assets valued at hundreds of thousands of dollars which were involved in the money laundering conspiracy. Greenfield was indicted, along with Nicholas Ryan Delon Smith, on February 10, 2010, and pleaded guilty on May 3, 2010.
On January 25, 2011, Smith, age 32, of Prior Lake, was sentenced to 40 months on one count of conspiracy to commit mortgage fraud through the use of wires and one count of money laundering. He also pleaded guilty on May 3, 2010.
In his plea agreement, Greenfield admitted that beginning in September of 2006, he conspired with an individual by the name of Brett A. Thielen, and others, to launder proceeds of the mortgage fraud scheme Thielen was executing at Sexton Lofts. Pursuant to the scheme, Thielen sold condos during a market downturn by recruiting financially unqualified buyers and fraudulently inducing mortgage lenders to lend those buyers money. To further the scheme, the condo prices were artificially inflated, creating substantial profits that Thielen needed to hide. Greenfield admitted helping hide those profits, even while knowing they were derived from unlawful activity.
Specifically, Greenfield wired the illegal profits to an unindicted Australian attorney through whom he had previously laundered money. Then, at Thielen’s direction, Greenfield instructed that attorney to wire portions of those profits to other places to make it appear as if they came from legitimate sources. For example, Greenfield directed the Australian attorney to wire a substantial amount of the illegal funds to a brokerage firm for the purpose of purchasing stock in a company called Digital Town, Inc.
During the investigation into Greenfield’s possible wrongdoing, an undercover law enforcement officer met with him at Manny’s restaurant in Minneapolis on June 30, 2009. In his plea agreement, Greenfield admitted that while at the restaurant, he also agreed to assist the officer in laundering $50,000 in supposed drug trafficking profits by converting the funds to Digital Town stock.
As for Smith, he admitted participating in the mortgage fraud scheme from August of 2006 through April of 2007. During that time, he was the sole owner of Heloc, Inc., a mortgage brokerage company in Minneapolis. In that capacity, he falsified income and employment information about his straw buyers in an effort to convince lenders they were credit-worthy loan applicants. Smith also knew the prices of the condos were greatly inflated, and that those prices were supported by fraudulent appraisals.
For his participation in the scheme, Smith received kickbacks from loan proceeds following the sale of condo units. On December 5, 2006, Smith wire transferred $25,500 in illegal proceeds from his company’s bank account to a third party during a transaction to purchase an automobile.
On December 21, 2010, Thielen, age 43, of Savage, was sentenced to 27 months on one count of conspiracy to commit mortgage fraud through the use of wires and one count of money laundering.
This case is the result of an investigation by the Internal Revenue Service-Criminal Investigation Division. It is being prosecuted by Assistant U.S. Attorney David J. MacLaughlin.
In the following press release by the FBI Field Office in Buffalo, NY U.S. Attorney William J. Hochul, Jr. announced today that Lori J. Macakanja, 35, of Dunkirk, New York, who was convicted of mail fraud and theft of government money, was sentenced to 72 months in prison and three years’ supervised release by U.S. District Court Judge Richard J. Arcara. Judge Arcara also ordered the defendant to pay $298,639.00 in restitution to the victims.
Courtesy of Buffalo News.comAssistant U.S. Attorney Trini E. Ross, who handled the case, stated that Macakanja, in her capacity as a housing counselor employed by HomeFront, Inc., inappropriately requested money from clients. The defendant told HomeFront clients that the money would be used toward loan modifications to prevent foreclosure on their homes. However, after receiving the funds, Macakanja used the money for her own personal use, including gambling, and failed to obtain the loan modifications for the victims. A total of 136 HomeFront clients were defrauded with losses totaling approximately $300,000. In addition, Macakanja also obtained federal grant monies from the Buffalo Urban Renewal Agency (BURA) for HomeFront clients. On two occasions, she diverted $2,000 worth of BURA money to pay her own personal mortgage.
“Many Americans are struggling to hold on to the American dream, ownership of a home,” said U.S. Attorney Hochul. “The victims turned to the defendant for help in keeping their home. Instead, the defendant abused their trust and stole their money. Unfortunately, because of the defendant’s actions, some of the victims lost their homes. Our office, along with our federal law enforcement partners, will work vigorously to protect federal funding targeted to help those who are struggling. We will also continue to prosecute those, like this defendant, who attempt to take advantage of those who are most vulnerable.”
“Lori Macakanja abused her position and violated the trust of distressed homeowners in the interest of personal gain,” said Cortez Richardson, Special Agent in Charge, U.S. Department of Housing and Urban Development, Office of Inspector General New York Region. “Her actions further jeopardized the assets of the Federal Housing Administration and unnecessarily complicated the lives and financial security of individuals already feeling the adverse impact of a volatile housing crisis. Today’s judicial action signals HUD’s Office of Inspector General’s firm commitment to working with our law enforcement partners to investigate and prosecute any individuals seeking to profit illegally from the nation’s mortgage crisis.”
“Macakanja preyed on the most vulnerable homeowners,” said Christy Romero, Deputy Special Inspector General for SIGTARP. “While an employee of a federally approved housing counselor, she illegally solicited and received payments from 136 homeowners facing foreclosure with the promise that the funds would be used to secure mortgage modifications. Little did the homeowners know, the payments were being used by Macakanja to support her gambling habit and to pay her own mortgage. SIGTARP will aggressively investigate and pursue those who exploit the federal government’s aid to homeowners under TARP and, with the help of its partners in law enforcement, ensure that they are brought to justice.”
SIGTARP investigates fraud, waste, and abuse related to HAMP and all other TARP-funded programs. HAMP encourages loan servicers and investors to modify mortgages to reduce the monthly payments of homeowners who are risk of default. There is no fee to homeowners to apply for a modification under HAMP.
The plea is the result of an investigation by the Mortgage Fraud Task Force of WNY, which includes agents and personnel from the U.S. Postal Inspection Service under the direction of Inspector in Charge Robert Bethel; the Housing and Urban Development Office of Inspector General, under the direction of Cortez Richardson, Special Agent in Charge, New York Region; SIGTARP, under the direction of Special Agent in Charge John Feiter; the United States Secret Service under the direction of Special Agent in Charge Tracy Gast; the Federal Bureau of Investigation under the direction of Special Agent in Charge Christopher M. Piehota; and the Internal Revenue Service under the direction of Special Agent in Charge Charles R. Pine. The Mortgage Fraud Task Force of WNY is led by the U.S. Attorney’s Office and also includes Veterans Affairs Office of Inspector General and the U.S. Bankruptcy Trustee.
In the following press release the Oregon Department of Consumer and Business Services announced that it had revoked the license of Fuqua Homes of Bend to sell manufactured homes, and fined the company $155,000 for failing to deliver on purchased homes or refund deposits to customers. The department, through its Building Codes Division, also decertified the company from producing homes.
Following an investigation prompted by consumer complaints, the department’s Division of Finance and Corporate Securities (DFCS) found the company had closed its manufacturing facilities in February 2011 but was still accepting customers’ deposits for home purchases. The company collected $500,000 through 26 deposits for the purchase of structures that were never built. Fuqua Homes accepted the deposits between October 2008 and August 2011.
“When violations of state law are discovered, it’s important for the department to take steps to ensure the fraud won’t continue,” said Patrick Allen, acting director of the Department of Consumer and Business Services.
The $155,000 penalty was for 26 violations ($5,000 each) for accepting the deposits and failing to either deliver on the homes or refund the money, and five violations of fraud at $5,000 each.
In one case, Fuqua Homes told a customer it would give him a discount if he paid for the home in full before production; the customer lost nearly $137,000 for a structure that was never built.
“This is a reminder that consumers should investigate a company before making a major financial purchase,” said David Tatman, administrator of DFCS. “While most businesses are honest and reputable, it’s still important to check with state regulators or the Federal Trade Commission about complaints.”
Fuqua Homes was operating a factory in Bend and a Eugene Super Sales Center in Coburg. Fuqua’s president and owner, Phillip R. Daniels, has been barred for five years from obtaining a license as a manufactured structure dealer or from working in an administrative or managerial capacity for any time of manufactured structures dealer.
Tatman urges consumers to verify the license of a dealer and investigate companies they are working with. Those who sell manufactured homes must be licensed in Oregon. Call the Division of Finance and Corporate Securities at 1-866-814-9710 (toll-free) or visit www.dfcs.oregon.gov.
In the following press release Christopher R. Thyer, United States Attorney for the Eastern District of Arkansas announced today that Scott Keith Voss, 43, of Jonesboro, Arkansas, was sentenced by U.S. District Judge Brian S. Miller to serve 33 months in prison, followed by five years of supervised release. Judge Miller also ordered Voss to pay restitution of $450,000 to the First Bank of Owasso and $148,564.94 to the Internal Revenue Service (IRS).
Voss, who served as pastor and president of First Pentecostal Church of Jonesboro, pled guilty to one count of bank fraud and one count of willful failure to pay over tax on November 9, 2011. Voss admitted during the plea hearing that from September 2007 until June 26, 2010, he devised a scheme to defraud the First Bank of Owasso. As part of the scheme, Voss applied for a loan from the First Bank of Owasso, pledging as collateral the Jonesboro Worship Center real estate. Voss then failed to obtain appropriate board of directors’ authorization to so encumber the church real estate. Voss used the funds to retire previous unauthorized loans for his own personal use, and to obtain additional funds for expenditures not approved by the board of directors of the Jonesboro Worship Center.
Additionally, Voss admitted that from 2006 through 2010, First Pentecostal Church of Jonesboro withheld tax payments from its employees’ paychecks. However, through this same period, the church failed to make any payments to IRS of these withholdings. Voss was the person responsible for the collection and pay over of the church’s payroll taxes. This investigation was conducted by the FBI and IRS Criminal Investigation.
Are you ready for a real estate investment conference that is not on big sell and spam fest? Are you tired of every speaker from the stage pitching their product instead of teaching you?
Well, your conference has arrived. Josh Dorkin and the crew over at BiggerPockets is putting on a truly amazing conference on real estate investing with the focus on giving you the tools and techniques to create a firm foundation for your business.
It really is that simple…
What you will not get is the hype of 20 products that will create miracles in your business and cure cancer at the same time.
Now, I do not want to pressure you, but I messed up. I told Josh, who is a friend and mentor, that I would put this post up weeks ago. But, as you know life gets in the way.
However, in the mean time space is filling up and I would hate for you to miss this conference. Josh told me he is keeping the conference small so that everyone who attends can get the most value out of it.
I remember the first RETechSouth conference that was like this one. I made more connections that helped my business in 1 day than I had the first 3 years I was blogging. Flagship conferences like this one from BiggerPockets will reap benefits for years if you take the initiative to attend.
The price is reasonable, the location is in Denver, Colorado (home of inexpensive flights and lots of fun), and the date is a little over a month away (March 23rd–24th).
So click on the link below to learn more and sign up for the conference.
P.S. Look for me on the floor, I am pulling strings to get out of every coaching assignment and obligation to get out there. It is so good that, even though I do not invest in real estate myself, I know I will learn a great deal and increase my knowledge of the real estate industry.
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In the following press release from the FBI Field Office in Miami Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; and Tom Grady, Commissioner, State of Florida’s Office of Financial Regulation, announced the sentencing of defendant Marlon Baugh, 32, of Pembroke Pines, Florida. On Friday, January 27, 2012, U.S. District Judge James Cohn sentenced Baugh to one year and one day in prison for mail fraud in connection with his participation in a mortgage fraud scheme. The defendant previously had pled guilty to one count of mail fraud, in violation of Title 18, United States Code, Section 1341.
According to information presented in court, defendant Baugh was a mortgage broker licensed by the State of Florida’s Office of Financial Regulation. Baugh was a partner at National Foreclosure Center, which was in the business of completing loan modifications for homes that were in foreclosure or about to go into foreclosure. Baugh and others engaged in a scheme to enrich themselves by fraudulently causing real estate to be bought and sold through straw buyers. Baugh and others falsified the Uniform Residential Loan Applications that were submitted on behalf of the straw buyers in order to fraudulently qualify the straw buyers for mortgages. Baugh also submitted false employment verification letters to support the false information on the loan application.
Mr. Ferrer commended the investigative efforts of the FBI and Florida’s Office of Financial Regulation. This case is being prosecuted by Assistant U.S. Attorney Laurence Bardfeld.
In the following FBI press release it was announced that former R.I. attorney James D. Levitt, 66, pled guilty in federal court in Providence today to three counts of bank fraud and two counts of filing false tax returns for his role in a million-dollar mortgage fraud scheme. Levitt faces up to 96 years in federal prison and a fine of up to $3.3 million dollars when he is sentenced by U.S. District Court Judge John J. McConnell, Jr., on April 19, 2012.
Levitt’s guilty plea was announced by U.S. Attorney Peter F. Neronha; Cortez Richardson, Special Agent in Charge of the HUD Office of Inspector General; Richard DesLauriers, Special Agent in Charge of the FBI’s Boston Field Office; and William P. Offord, Special Agent in Charge of the Boston office of the Internal Revenue Service, Criminal Investigation.
At today’s change of plea hearing, Levitt admitted to the court that between July 2006 and November 2007 he applied for and received, based on fraudulent information, three mortgages totaling more than $1.1 million for two properties in Providence and one in East Providence. He used two of the mortgages to buy the Providence properties from an acquaintance that was experiencing financial problems and was facing foreclosure on the properties. Levitt admitted that he offered to assist his acquaintance by purporting to obtain a buyer for the properties who was qualified to obtain financing to purchase the properties.
In order to finance the purchases, Levitt admitted that he induced a business associate to apply for the mortgages by representing to him that they would be partners, would refurbish the properties as condominiums and sell them at a profit. Levitt admitted that the mortgage applications and settlement statements contained false information; including failing to identify the true purchaser of the property and falsely stating that the buyer was putting a down payment in excess of $100,000 for each property.
Levitt admitted to the court that he conducted the closings on the properties despite his financial interest and despite the fact that he was a disbarred attorney. After the closings, Levitt obtained and deposited the majority of the proceeds of the sale of the properties, approximately $270,000, into bank accounts which he controlled. He provided $25,000 of the proceeds to the seller of the properties shortly after the closing, and he later made periodic payments. However, Levitt admitted that he used the majority of the proceeds for his business and for personal expenses. The two properties eventually went into foreclosure.
Levitt admitted to the court that he used the third mortgage to buy a property from another company he controlled. He applied for the mortgage in his own name. The application also contained false statements and omissions, including an affirmation by Levitt that there were no outstanding judgments against him when, as he admitted to the court, he knew that there was an outstanding judgment against him of approximately $432,728 by the State of Rhode Island, which represented restitution owed to the State on a prior criminal conviction.
Levitt also admitted to the court that he failed to disclose to the Internal Revenue Service in tax filings in October 2007 and October 2008 derived income from the ventures as well as from other sources.
The case is being prosecuted by Assistant U.S. Attorney Luis M. Matos.
The matter was investigated by the U.S. Department of Housing and Urban Development Office of Inspector General, Federal Bureau of Investigation, and Internal Revenue Service-Criminal Investigation.
The new home sales data was released and the results are less than stellar. For 2011, there were only 302,000 new home sold nationwide. For perspective, in the South the numbers were the lowest since 1966, and that is the good news. In both the Northeast and the West, sales were the worst in recorded history.
So when you are talking with builders, be kind. They have had a very rough few years.
Purchases of single-family properties decreased 2.2 percent to a 307,000 annual pace, figures from the Commerce Department showed today in Washington. The median forecast in a Bloomberg News survey of economists called for a rate of 321,000 home sales. Last year marked the worst year for the industry in records going back to 1963.
The threat of further price declines may be dissuading some Americans from buying a new home even with mortgage rates near all-time lows and more people finding work. Following a lull in 2011, a wave of foreclosures may hamper the recovery in real estate as more distressed properties are put on the market.
“Builders continue to contend with a number of existing homes that are deeply discounted,” said Anika Khan, an economist at Wells Fargo Securities LLC in Charlotte, North Carolina. “We’re expecting a bit of a pickup in 2012, but we won’t see a meaningful increase as long as new homes are competing with those existing homes.” via Bloomberg
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In the following press release the United States Attorneys Office in Miami, FL announced that a loan officer was sentenced Friday by U.S. District Court Judge William P. Dimitrouleas in Ft. Lauderdale, Fla., for his participation in a nationwide $2.5 million reverse mortgage fraud scheme.
Louis Gendason, 42, of Delray Beach, Fla., was sentenced to 70 months in prison, five years of supervised release and ordered to pay over $2 million in restitution. Gendason was the mastermind of this complicated reverse mortgage fraud scheme, which was designed to lure financially distressed elderly homeowners into applying for reverse mortgage loans, to create fictitious equity in their homes with fraudulent appraisals, and ultimately to steal that false equity from the seniors and their lenders. Gendason cultivated relationships with each of his co-conspirators and they executed their respective roles in the scheme at his behest.
Kimberly Mackey, 47, of Pittsburgh, and Marcos Echevarria, 29, of Palm Beach, Fla., received prison sentences of 60 and 24 months, respectively, on Nov. 3, 2011. A third co-defendant, John Incandela, 25, of Palm Beach, was sentenced to 41 months in prison on Dec. 16, 2011. Gendason was the final defendant in the scheme to be sentenced.
“This reverse mortgage loan modification scheme robbed elderly homeowners of more than just their homes,” said Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida. “It also robbed them of the American dream of home ownership, their peace of mind, and in some cases, their life’s savings. Through these prosecutions, these fraudsters have been brought to justice.”
“The stiff sentence the court imposed on the leader of this reverse mortgage fraud scheme sounds a cautionary note to those who prey upon elderly, distressed homeowners,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “We will not waver in our commitment to investigate, prosecute, and hold accountable those who try to victimize our nation’s most vulnerable consumers.”
A reverse mortgage, also known as a Home Equity Conversion Mortgage, allows borrowers who are at least 62 years of age to convert the equity in their homes into a monthly stream of income or a line of credit. Unlike the traditional mortgage loan scenario, in which borrowers make monthly payments to a mortgage lender in satisfaction of their outstanding loan, in a reverse mortgage loan scenario, the mortgage lender purchases borrowers’ equity and makes installment payments to the borrower.
According to the information and statements made during the August 2011 hearing in the case, from May 2009 through November 2010, the defendants engaged in a reverse mortgage scheme that defrauded unwitting borrowers, Genworth Financial Home Equity Access Inc., and the Federal Housing Administration (FHA). As the scheme’s ring-leader, Gendason, along with loan officers Incandela and Echevarria, solicited seniors to refinance their existing mortgages with a reverse mortgage loan financed by Genworth. To qualify the borrowers for these loans, Gendason altered real estate appraisals to fraudulently inflate the value of the borrowers’ properties. In fact, however, none of the borrowers had sufficient equity in their properties to qualify for a reverse mortgage. The defendants then submitted the fraudulently inflated appraisals to Genworth. Based on the false documentation, Genworth approved and the FHA insured more than $2.5 million in reverse mortgage loans.
As part of the scheme, Mackey, a licensed title agent, fraudulently closed the Genworth loans and did not pay off the borrowers’ existing mortgage loans. Mackey attempted to conceal the fraudulent loan closings by preparing false settlement documents that showed that the existing mortgages had, in fact, been paid off. The defendants divided up the loan proceeds and each used the money for his or her personal benefit, including for such things as gym memberships, vacations, and casino gambling.
The defendants further engaged in a loan modification scheme to conceal the existence of the Genworth reverse mortgage transactions from the original mortgage lenders, whose loans remained unpaid. To this end, Gendason, Incandela and Mackey conspired to create fictitious offers to buy some of the borrowers’ properties in the form of “short sales.” A short sale is a sale of real estate in which the sale proceeds are less than the balance owed on the loan to the mortgage lender, but avoids foreclosure and related costs. In other instances, to hide the existence of the Genworth reverse mortgage loan from the original lenders, the defendants made monthly mortgage payments to the borrowers’ original lenders. Many of the elderly homeowners that trusted the defendants anguished for years over whether they might lose their homes after learning that the defendants had stolen their reverse mortgage loan proceeds.
The case was investigated by agents from the U.S. Department of Housing and Urban Development Office of Inspector General, the Internal Revenue Service’s-Criminal Investigation, the U.S. Postal Inspection Service, the FBI and Florida’s Office of Financial Regulation, with assistance from the U.S. Secret Service and Genworth Financial Home Equity Access. The case was prosecuted by Kevin J. Larsen, a Trial Attorney in the Justice Department’s Consumer Protection Branch, and Assistant U.S. Attorneys Jeffrey H. Kay and Thomas Lanigan of the Southern District of Florida.
In the following press release from the FBI Field Office in Philadelphia it was announced that Bonnie Sweeten, 40, of Pennsylvania, was sentenced today to 100 months in prison for fraud schemes in which she stole in excess of $600,000 from her employer and family members. Sweeten pleaded guilty June 21, 2011 to wire fraud and aggravated identity theft. In addition to the prison term, U.S. District Court Judge William H. Yohn, Jr., ordered Sweeten to pay restitution in the amount of $1,091,831 and a special assessment of $200. Sweeten remains in federal custody.
Sweeten stole funds from family members, from the law office where she had been employed, and from the law firm’s clients. She used the identity of another person and posed as another person while using false identification and forging signatures on various documents including a property settlement.
Additionally, Sweeten stole the identity of a friend and fellow employee and used the identity to facilitate her flight from the jurisdiction. She also forged a signature of a judge on a court order for the purpose of fraudulently withdrawing client funds from a bank. As part of her scheme to defraud, Sweeten concocted an elaborate hoax that she and her daughter had been kidnapped in order to deceive family members and law enforcement as to her whereabouts.
The case was jointly investigated by the Federal Bureau of Investigation and the Bucks County District Attorney’s Detectives. It was prosecuted by Assistant United States Attorney Denise S. Wolf.
In the following press release by the FBI Field Office in Norfolk, VA it was annouced that Kathleen Harps, 51, of Chesapeake, VA, was sentenced today in Norfolk federal court to 54 months in prison for operating a foreclosure rescue mortgage fraud scheme.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after Chief United States District Judge Rebecca Beach Smith imposed the sentence. Harps previously pled guilty on August 23, 2011.
According to court documents, during 2006 Harps owned and operated the now defunct Hampton Roads businesses, New Beginnings Group, LLC, and IMAK Group, LLC, which specialized in “foreclosure rescue.” Through these businesses, Harps and others solicited homeowners in financial distress and facing foreclosure, to agree to sell their homes to Harps or straw buyers working with her. Harps promised the homeowners that, during a one year period after the sale, they could remain in their homes without having to pay the mortgage, while simultaneously putting their financial affairs back in order, so that they could buy back their homes at the end of the year. This, however, failed to occur. Instead, court records show that Harps and her straw buyers made assorted false statements to fraudulently obtain mortgage loans, upon which they later defaulted. As a result, foreclosures soon followed and the homeowners lost both their homes and substantial sums of homeowner equity, which was siphoned out of the closing transactions and paid to Harps’ businesses.
This case was investigated by the Federal Bureau of Investigation. Assistant United States Attorney Robert J. Krask is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on http://pacer.uspci.uscourts.gov.
Typically when you think of a battle between a house and a Prius, you add a dose of a drunk driver and a garage and you are done… But not today.
It looks like that super efficient windows are reflecting so much energy onto a car parked in Southern California that it is melting the plastic exterior parts of a lady’s Prius parked outside of the building.
A SoCal woman says the energy efficient window installed in a neighbor’s condominium is melting the plastic components on cars parked in her carport. Heather Patron of Studio City was dealing with a mystery regarding her Toyota Prius.
“The side view mirrors were melting,” says Patron. “Anything that was plastic on the car was melting.” Patron then observed a powerful beam of light that was reflecting off the window of a next door condominium, casting a concentrated beam over her carport.
CBS2’s Randy Paige placed a thermometer in the pathway of the beam on a partially cloudy day. The temperature registered over 120 degrees in less than five minutes.
“I’m positive that this window is what is causing the damage to my car,” says Patron.
Patron is not alone. Reports across the country have alleged damages brought on by concentrated sunlight reflected off of energy efficient windows. The National Association of Home Builders is now conducting a study on the matter. via CBS LA
There is no regulations against these types of windows but it will be interesting. And it makes me wonder if we are going to see melting Prius’s around the country in the coming years.
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
In the following FBI press release Thomas G. Walker, United States Attorney for the Eastern District of North Carolina announced that in federal court today, Chief United States District Judge James C. Dever III, sentenced ERIC OMAR JONES, 41, of Clinton, North Carolina, to 151 months’ imprisonment followed by five years’ supervised release. Additionally, the court imposed restitution of $142,145.85.
A federal grand jury returned a superseding Criminal Indictment on February 2, 2011. On April 21, 2011, a jury convicted JONES of all counts of the indictment, which included one count of conspiring to commit bank fraud and to make false statement to influence a bank on a loan, 15 counts of bank fraud, and two counts of making false statements to influence bank loans.
In determining JONES’ sentencing guidelines range, the court found that he had received more than $1 million in gross receipts from financial institutions as a result of the offense. It found that the defendant was the leader of a criminal activity that involved five or more participants or was otherwise extensive. It found that the defendant abused a position of private trust through his interactions with unsophisticated investors. It also found that he obstructed justice through perjurious testimony at his trial.
At trial the government’s evidence showed that between 2002 and 2004, JONES participated in a scheme to defraud Omni National Bank and other banks. JONES used the credit of straw purchasers to obtain loans from Omni National bank in the name of those individuals. He then used that loan money to purchase properties through his company, University of Hard Knocks Investments, Inc., and then immediately resell them to the straw purchasers, whom he referred to as investors. Six straw purchasers testified at trial. David Pikul, the closing attorney who handled these transactions, also testified at trial. On April 11, 2011, Pikul pled guilty to conspiring with JONES to commit bank fraud and to make false statements to an FDIC insured bank. JONES enticed the straw purchasers to participate by promising them that he would make mortgage payments on the properties, take care of repairs, and sell the properties at a profit. These promises were untrue and fraudulent.
Further evidence showed that to obtain loans from Omni and other banks, JONES made numerous false statements on the HUD settlement forms that were submitted to the banks. These forms hid the fact that the bank’s money was being used by JONES’ company to purchase the property. They also often falsely stated that a down payment was being made, when, in fact, there was none. Sometimes the HUD forms falsely stated the seller of the property. As part of this scheme, on at least four occasions, JONES sold the same property to the same straw purchaser a second time for a higher price. In addition, JONES was living in one of the properties he had sold to one of the straw purchasers. He was doing this without her knowledge and without paying any rent or mortgage. This straw purchaser ultimately had to evict him.
JONES, testifying at trial, admitted he had 10 years of experience in the mortgage and real estate industry at the time of the crime. He also admitted receiving and signing many of the false HUDs–knowing they were false. He claimed that the closing attorney, David Pikul, had come up with this idea and had told him that it was a correct way of doing things. He admitted receiving a lot of money through University of Hard Knocks Investments and using that money, considered by him to be his business “profits,” to take several gambling trips to Las Vegas, Atlantic City, South Carolina, and New Orleans.
The Federal Bureau of Investigation and the North Carolina State Bureau of Investigation participated in this investigation. David A. Bragdon and William M. Gilmore represented the United States.
When buying a home, one of the key components is the down payment. Back a few years ago when the housing bubble was hitting it’s peak, there were no money down loans floated out there, but those are ancient history. Now you need hard money to make the loan.
Lending Tree commissioned a study and measured the states on what the average down payment for a home was in each state. From the low 3.5% down FHA and VA loans to the private loans that are looking for 15% to 20% or higher, the range for all the states in the country range from the high in New Jersey of 13.71% down to the low of West Virginia at 11.86%.
To be honest, I was a bit surprised the difference between the states is so little. This tells me that lending standards are tightening up, borrowers are having enough skin in the game to protect the banks from losing too much in foreclosure, and that the lending environment is becoming healthier.
This is all good news for the real estate industry.
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
I wasn't going to write about this, but since it's the holiday season, I figured now would be a good time.
About a year ago, I came across Kiva.org, a microlending site. It's similar to Prosper.com in that it works by people lending money to other people. The difference is the other people are in third world countries and are taking small loans to help improve their situation by opening or expanding a business. Kiva charges no fees and 100% of the money you lend goes to the borrower. Like Prosper, you can search lists of people looking for loans and select the ones you want to lend to. But, and here's the reason I originally wasn't going to write about this, the lender (you or I) gets no interest. There is no return on investment for the lender other than the satisfaction of helping someone in another country improve their lot in life.
Kiva works by teaming with field partners in various countries who are the ones who actually fund the loans and collect payments. More information can be found here. The borrower does pay interest on the loan, but that is kept by the field partner.
As with Prosper, there are risks - namely that your loan won't be repaid. Additional risks involve currency exchange rates, political unrest, and all the other risks that come with investing in another country. But Kiva lets you start lending with as little as $25, which is what I've started with. If my loan defaults, I'm only out twenty five bucks. I can handle that. I've made one loan so far to a woman in San Salvador to expand her business of selling cosmetics and small household appliances. The loan was for 20 months and is 55% repaid. My sister-in-law has been lending through them for a couple of years and has made 3 or 4 loans so far.
If this sounds like something you are interested in, please check out Kiva.org. Have a happy holiday season!
As real estate professionals, your goal is a healthy and vibrant real estate marketplace. Lots of selling and buying of homes is a good thing, as is a healthy credit report and sufficient cash on hand by your buyers and large amounts of home equity with your sellers.
But if the last few years has taught us anything, that is not always the case. Heck, in some markets, that rarely is the case.
So being a real estate professional you also end up answering many questions about people having their homes underwater at this year’s Christmas Parties.
Economic editor Megan McArdle writing in the Atlantic has a very thought provoking post out today discussing “When Should You Default on Your Mortgage?” Here is an excerpt but you should also go read the whole article. It is an issue that is on the table for many of the people in your marketplace and may help you as a trusted real estate professional giving solid and powerful advice.
As you can see, I think that people who are in financial trouble and cannot make their mortgage payment have a perfect right to walk away–and to do so as early as possible if there is no reasonable likelihood that their circumstances will change. On the other hand, I think that if modest lifestyle changes like less steak and more hamburger, less cable and more library books, can make your mortgage payment affordable, I think you have an obligation to make those changes. And if those changes aren’t even necessary–if the default is purely and simply because you would like the bank to eat the lost equity rather than you–I don’t think that’s right.
But for all the discussion of those people, I’m not sure how many of them there are. Some, undoubtedly–in a country as big as the US, there is always some jerk doing almost anything you can imagine. But given what we know about bankruptcy, I tend to think that the overwhelming majority of people walking away from their houses are doing so because they cannot support both the home, and a basic decent life for their families. Obviously, I also tend to think that’s how it should be.
And if you have any suggestions from the trenches on Megan’s advice, leave them in the comment section. Odds are there will also be people fighting through a rough mortgage right now reading this post and they will appreciate any and all help you can offer.
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
According to CoreLogic the number of homes sold as reported by the National Association of Realtors could be off by 20% over the past 5 years.
Heads should roll, but they probably will not over this.
The National Association of Realtors said a benchmarking exercise had revealed that some properties were listed more than once, and in some instances, new home sales were also captured.
“All the sales and inventory data that have been reported since January 2007 are being downwardly revised. Sales were weaker than people thought,” NAR spokesman Walter Malony told Reuters.
“We’re capturing some new home data that should have been filtered out and we also discovered that some properties were being listed in more than one list.” via Reuters
My biggest problem with this is that it is the fox watching the hen house. You have an advocacy group reporting declining numbers that affects their dues paying members. It was in the best interest of the NAR to be “off” a little bit each month to make the numbers look better.
Just as the Labor Department reports the unemployment numbers each week and then quietly revises them upwards after the news cycle is over, so it seems that the NAR is doing the same with the housing numbers.
And what a surprise, they are reporting this during the Christmas lull so it can be old news when the selling season starts.
Thanks for reading this post. If you would like to see more articles like this, please come visit The Real Estate Bloggers. where it was originally published.
Rob doubles up his gig as a Realtor and head of Safe Haven, a non-profit organization based in Falls Church. Rob hangs his real estate hat at Long & Foster's Annandale office.
I first met Rob at a volunteer event hosted by a mutual friend of ours, in Reston. In our conversation, he mentioned that he works for this non-profit that serves meals for the poor. It just so coincidence that in my sparetime, I sometimes do volunteer work (outside my political activism) for organizations that serve meals for the poor/homeless. But in that capacity, I had never really seen the faces because most of the time we work behind-the-scene, until... last week.
So I decided to pay a visit to his organization last week.
On weekdays, Rob is wearing the hat as the Director for Safe Haven, "a non-profit day shelter that provides food and comfort to the hungry and homeless in the Falls Church area of Fairfax County," according to their website. Safe Haven is falls under the umbrella of First Christian Church of Falls Church. (He didn't tell much about his real estate business. We talk most of the time around the organization he works for).
Safe Haven was founded 10 years ago by Bill LaLiberte who decided at the age of 83 that he wanted to do something for the area homeless with the help of his church.
While waiting for Rob to finished up his meeting, I talked to Erin McKenney, who works as his assistant. At the time, Erin and a volunteer were working the table registering and counting how many people actually showed up that day for breakfast and lunch.
She told me that day they have at least 100+ people. "We have 153 people show up today," she says. People would come and go. "Sometime you see the same people come to the site, sometime they would come one day and never show up again."
Safe Haven serves meals (breakfast and lunch) on Thursdays for most months of the year. However, during the cold winter months they add another day - Tuesdays - to the schedule.
Rob came to Safe Haven from another non-profit gig he had not far from where his office is now, where he taught financial literacy to the low income (mostly unemployed). He's been with the organization since mid 2010.
On the menu was pasta, salad, and cakes for dessert. So after they served the homeless, we - the volunteers and us - got to taste the food for lunch. Yum! The quality of the food was really good. The salad was fresh. With the exception of cakes, think the salad and pasta were prepared by volunteers from scratch - at Safe Haven's kitchen.
"One day, one of my friends who I haven't seen in 20 years, read about what I do now from Washington Post - and sent us a check - which was enough to feed them for 6 months!" Rob says. Every month, volunteers from different churches in the area come to help them out - whether working the kitchen, washing dishes or serving meals. There's usually one week a month that Safe Haven have to provide the meals upon themselves.
In addition to working to help the homeless, Rob also loves to help homeless animals. He saved his then someone's dog from a foreclosed home.
Rob would like to see next year - budget permitted - that Safe Haven expands their services into job training in addition to the ESL (English as a Second Language) that recently was added to the program. "People just need jobs. They want to work," he says. For him to expand their services into job training, they would need to pump up funding from private donations. Because right now, the small grants they received from the County covers only expenses for staffing up the program. There's no funding to cover the job training program yet.
If you want to help, donate and/or volunteer, you can reach them via their website [www.fccfc.org]. You can also find them on Facebook [www.facebook.com]
WISH LIST for Safe Haven
Here is the list that was put together by one of the volunteers. You can drop your donation off at Safe Haven, 6165 Leesburg Pike, Falls Church - Tuesdays and Thursdays from 9am to 3pm.
We just got our latest look at existing home sales from the National Association of Realtors. Sales rose 1.4% to a seasonally adjusted annual rate of 4.97 million in October from 4.9 million a month earlier. That topped expectations for a reading of 4.8 million. We saw strength in most of the country, with sales up 2.1% in the South, 2.8% in the Midwest, and 4.4% in the West. Sales fell 5.1% in the Northeast.
Single family transactions led the way with a gain of 1.6%, while condo and coop sales were flat on the month. The supply of homes for sale dipped to 3.33 million from 3.406 million in September. That was equal to 8 months of supply at the current sales pace, down from 8.3 a month earlier. Meanwhile, the median price of a used home fell to $162,500 from $165,800 in September. That was also down 4.7% from a year earlier.
The housing market is showing a slight improvement in tone these days, with builder optimism and now, used home sales perking up. Strength was broad based in October, led by the core single-family market. That said, we're still talking about a low level of activity overall. Pricing also remains weak, and distressed inventory continues to find its way into the market courtesy of an ongoing wave of foreclosures.
We also have to watch the credit markets closely. The European chaos is spreading into more and more corners of the banking sector and capital markets. That could lead to tightening credit standards in the mortgage market, exactly what potential home buyers DON'T need right now.
But in a dramatic about-face, Redfin has begun buying advertising again, this time paying for such key words as “Seattle Real Estate” and apparently appropriating the name of my own business “Seattle Dream Homes” in an advertising campaign using Google Adwords.
What is the cause of this sudden advertising campaign and why the likely appropriation and use of a tiny competetors exact business name?
As the Business Journal points out, Redfin is not in the top 10 of most-visited real estate sites, which gives them perhaps a 1% market share.
They recently accepted another $14M, even though in interviews Kelman claims Redfin is profitable and doesn’t need it.
Zip Realty recently converted their employees to independent contractors and also discontinued making rebates to buyers. If Zip couldn’t make it, how could Redfin, with their 100’s of employees and 50% commission rebate? With that kind of business plan, they need to make up the refund with volume, which could explain the sudden backtracking on advertising.
Interesting enough, they don’t seem to be advertising in every city, just Seattle. I suspect that is because Seattle remains their cash cow and the media here is particularly friendly to them. A certain tech writer reports every burp and fart and that continues to give the company free publicity. They also seem to have the most employees located in Seattle and they seem to be very top-heavy in administration and technical support here, and they are advertising for dozens of new jobs in the Seattle area.
It’s interesting that Redfin appears so desperate as to try to siphon off my customers using the exact name of my business in their Google Adwords. Could this really be the business plan of a successful and profitable company with 100′s of employees and millions of dollars, to try to skim business from one little tiny real estate broker? Wow.
Update: It was pointed out to me that one gets similar results when one searches for Seattle discount brokerage “Findwell“
Thinking about remodeling your home? In today’s housing environment, whether you are buying or selling, a renovation may be the key to substantially increasing your home’s value. And the difference between this home or that other home – if you’re on the market to buy.
You've got the option to fix up the outside of your home, the inside or both. You can also have a small makeover project that can “wow” people like changing fixtures, painting or updating lighting. Or do a large scale project that include complete kitchen or bathroom remodels, the addition of hard wood flooring or the finishing of a basement area. Whatever you decide.
Here is the challenge. Renovation planning can be time consuming, confusing and overwhelming, it requires careful planning with a financial and time management budget. Chain stores with limit stock options can lead to long waits and delays in renovation projects. Driving from store to store searching for the perfect price and checking ever changing stock can be a waste of time when homeowners have options like a Direct Buy membership.
Why Direct Buy membership makes “cents?”
Direct Buy Membership offers one stop shopping in a local showroom or online at directbuy.com at prices up to 50% off retail. Direct Buy membership gives members access to over 1 million products at direct from the manufacturer prices.
Direct Buy uses its member’s collective buying power to purchase merchandise at wholesale prices then passes that savings along to its members. Direct Buy members have the ability to choose from a wide variety of merchandise from flooring, fixtures and cabinets to jewelry and furniture. Direct Buy reviews praise this innovated and simple way to shop at greatly discounted rates. Direct Buy Reviews also found Direct Buy’s no pressure sales force friendly and knowledgeable.
An episode of HGTV’s “House Hunters” featuring Seattle resident Valerie Sloane and her friend Mary Jo Reynolds will air Monday, November 7th at 11pm, and again later at 2am.
I played the real estate broker. It was a stretch, but I made it work.
You’ve probably seen House Hunters before where the premise of the show is a buyer decides to make a home purchase and then the agent “presents” 3 homes to choose from. By the end of the 30 minute show, the buyer decides which home to buy.
Valerie was renting a house in West Seattle and realized she wanted to move closer to the city and she was ready to be a homeowner. I showed her homes in the Central District, Seward Park, Mt. Baker, Madrona and Capitol Hill.
The HGTV producers try to create some drama about what the buyer will decide and even show the buyer and her friend making the big decision. However, it’s all faux, as the buyer has already bought and closed on the house by that time! That’s why some of the shows look like the buyers and the agent are acting. Because they ARE!
In real life, I took Val to look at dozens of homes, she bought one and then they went back and “re-enacted” the home search for the film crew.
Then, after Valerie moved in to the new home and fixed it up, the film crew came back and filmed an “after” segment to show how cute her new home is.
The buyer, Valerie Sloane, is a private tutor, but the family she works for did not want their children on the show, so my son Sam David, a student at St. Joseph’s School in Seattle, was the stand-in stunt double.
Don’t have cable? You can watch the House Hunters episode from the comfort of your computer screen HERE.
It took just about a week, but my funds from HML #17, which closed on the 21st, have found a new home.
Our best borrower picked up a triplex at a foreclosure auction. The property is in San Lorenzo, California and went at auction for $331,000. Our loan is for $210,000. The property square footage is about 2,600 although the MLS listing for it does not give a square footage.
As we did with the last property, we pulled comps using both residential and income property searches on the MLS. Income property comps show up at $315,000 for a 4-plex that is smaller than the subject property and another 4-plex listed at $725,000 but that's bigger than the subject property. There is a triplex that sold recently for $329,000 that was smaller.
On the residential comp list, we had about 12 properties, all that were smaller than the subject and all on smaller lots. Highest priced one sold for $335,000.
Based on rents of single family homes in the area, my partner estimates the monthly rental income to be about $1,200 per unit. (The subject property is really a single family house with a duplex in back.)
Our borrower estimates the property to be worth $500,000. I'm not sure how he gets a figure that high, but he knows the area better than me and comps are pretty hard to come by, as usual for triplexes. The property has tenants in place and they have indicated they want to stay. We have not seen the inside, so we don't know the condition. The roof appears to need some work. Our borrower has experience in the area - he actually rehabbed the property right next door, which is a 1,000 square foot SFH that he sold for $280,000 back in August. My partner was his lender on that project too (although I wasn't).
Our LTV based on the sales price is 63%. Should we have to take over the property, we'd get an income-producing property generating about $29,000 per year for $210,000. Not bad. Our loan terms are our standard - 12% interest only loan, 1 year term. And with this deal, all my funds are fully invested again!
The law offices of Steven J. Baum, a firm that specializes in foreclosures and is under investigation by the NY Attorney Generals office, had a Halloween party and the New York Times has published a series of photos that shows the costumes: people dressed as the new homeless. Wow.
We just got the latest data on home sales and pricing, and it was a mixed bag. New home sales rose 5.7% to a seasonally adjusted annual rate of 313,000 in September from 296,000 in August. That topped forecasts, and it leaves sales at the highest level since April. Sales rose in two of four regions (the West and South), and fell in the other two (the Northeast and Midwest).
But the median price of a home fell off the table, dropping 3.1% on the month, the third straight decline. Prices were also down 10.4% from a year ago, the biggest monthly drop in more than two years. At $204,400, median prices haven't been this low since last October. The raw number of homes for sale remained at a multi-decade low of 163,000, while the "months supply at current sales pace" indicator of inventory dipped to 6.2 from 6.6.
We continue to get mixed data on housing, with sales stabilizing at relatively low levels but home prices coming under significant pressure. It seems the only way to generate volume in an era of falling consumer confidence, tighter lending standards, and stiff competition from distressed inventory is to slash prices. And that's precisely what new home builders appear to be doing.
We have managed to cut new home inventory to the bone. So once the supply of used homes falls significantly, builders will be in a stronger pricing position. But that's a process that will take a couple of years, rather than months. If you're a home builder, you have to stay lean and mean if you want to survive.
Well, since the last loan fell through due to the property owner filing bankruptcy prior to the foreclosure auction, I had some funds available for a loan. Luckily, my partner found a good one fairly quickly.
This is an occupied duplex in Hayward, California. As it's occupied, we don't have any indication of the state of the interior, but the exterior looks to be in good shape and looks to be well maintained. The building is about 2,100 square feet and was built in 1957. It's got a 2 bed /1 bath unit and a 1/1 unit. The property was listed for sale back in 1999 for $280,000 but it did not sell. The comments in the listing indicate there is a studio behind the main building, so this might actually be a triplex. However, as we are unable to verify that, we are evaluating it as a duplex.
Rents total approximately $2,000 a month, although this is not confirmed. (Figure is based on the old MLS listing trying to sell the property in 1999.) The sell price at the auction was $233,000 - the opening bid price. Our mortgage is for $137,000. My partner pulled comps for both residential properties and income properties. Comps are a little spotty, as there are not many similar properties nearby. The city is average, but the property itself is close to Castro Valley, which is an above average city, so that will help the property value. Comps vary from $270,000 to $600,000, but there are none that are a good match. Our conservative estimate of value is $275,000, but my partner thinks that could be off by $50,000 in either direction. The buyer, our good customer again, thinks it's worth $325,000. Overall, this actually appears to be a safer investment then the one that was canceled last week.
Pros: Borrower is our good customer who typically pays early. He's got a well-established history of success and paying on time. He is personally guaranteeing the loan. Based on the sales price, our LTV is 58%. If we had to take over this property for non-payment, we'd get an income-producing property generating about $2,000 a month on a $137,000 investment. That's a pretty good worst-case scenario.
Cons: Our borrower is personally guaranteeing over 40 loans. It's unclear what the current leases are and what the interior condition is. Comps are hard to come by. If we had to foreclose, duplexes take longer to sell.No one else at the auction bid on this. Do they know something our buyer doesn't?
After going over the 10 pages of documentation my partner sent me, I decided to go ahead and invest in this one. This one I'm labeling hard money #21.
In other news, hard money loan #17 was paid off on Friday, so those funds are now looking for a new home. Back in May, when we made the loan, we estimated the after-repaired value of the property to be $195,000. The actual sales price was $210,000, so our estimate was pretty conservative. No problem with that, but I just like looking at how our estimate compares with the actual sales price. The borrower was a new customer for us and it's good to see he seems to know his stuff.
We just got a look at September existing home sales figures. Total sales fell 3% to a seasonally adjusted annual rate of 4.91 million from 5.06 million in August. That was right in line with the estimates of economists polled by Bloomberg. Single-family sales dropped 3.6%, while condo sales rose 1.8%.
The "months supply at current sales pace" indicator of inventory inched up to 8.5 from 8.4, while the raw number of homes for sale dipped 2% to 3.48 million. Meanwhile, the median price of an existing home fell sharply to $165,400 from $171,200 a month earlier. That was down 3.5% from a year ago.
September was another lackluster month for the housing sector, with used home sales falling slightly and home prices slipping a bit. Tighter lending standards and ongoing weakness in the labor market are combining to cap demand, while an ongoing influx of foreclosed properties is keeping the supply of homes for sale from declining sharply. The result is continued pressure on home pricing, and a stagnant buying climate.
The September housing starts figures were just released and they popped by a surprising 15%. The 658,000 seasonally adjusted annual rate of starts was well ahead the median forecast of 590,000 and the highest since April 2010. We saw broad-based regional strength as well, led by the West with a gain of 18.1%.
However, the strength was mostly in the multifamily sector, where starts surged 51.3%. The less-volatile single-family market was more subdued, with a gain of only 1.7%. On the building permits front, we saw a slide in both the multifamily (-14.5%) and single-family (-0.2%) sectors. That left permits at a five-month low, portending a slowdown in future construction. The West led with a 9% decline in permits.
Construction of multifamily properties like apartments, condos, and town homes perked up in September, helping push housing starts to the highest level in 17 months. However, permitting activity slipped and the less-volatile single-family market remains subdued. So once again, we're left with a mixed bag of news on the housing front. It will take a more vigorous rebound in the labor market, an improvement in consumer confidence, and a loosening of lending standards to really rev up the housing market's engine again. Unfortunately, those forces don't appear to be coming together.
Shopping for your next second-home property? Here's an idea for you. The Economist's Online Fairs business just annouced that they will host an online event that showcase listings that represents a unique collection of the world's most exclusive properties. You can check these properties out from the comfort of your home. How cool is that?
From ski homes, to golf estates to urban luxury living, the Fine Properties Fair offers attendees access to important information about global vacation second-homes in top locations like the Carribean, Florida, Central America, Europe, Australia, Canada, and more. In addition to browsing real estate listings, visitors can also meet online with real estate experts participating in the event. Visitors can join webminars focused on trends on international real estate investment.
If you haven't attended virtual event, think of it like going to an exhibition except instead of real booths you have virtual booths, where you can participate in whatever activities they have on there.
Realtors can benefit from this kind of luxury properties Fair. Who knows your client is interested in buying their second, third homes - internationally?
"Purchasing high-end real estate is never an easy decision," said Isaac Showman, Vice-President and head of Online Fairs. "The Fine Properties Fair provides all of the information potential buyers might need to make an informed decision and does so in just one place."
Got a request from an escrow company for a payoff amount on hard money loan #17, so that should be closing soon. Another short loan - just 5 months.
Got an update on the Houston apartment complex a couple of weeks ago for the month of August. It wasn't a good month. Our occupancy stayed stable at 93%, but expenses were up. The main culprits were higher utility bills during the summer - water and electricity are running about $10,000 more per month than they cost in the winter months. The good news here is that those bills should start declining. Management has said the September bills are running about $7,000 lower than August.
Another expense was an "extraordinarily high" number of counter top resurfaces for the 22 units that were turned over. Not sure if these were just really destructive tenants or if these units were just getting to the point where this needed to be done after several tenants had lived there. And, as mentioned previously, our loan payment has switched from interest only to principle and interest, so our mortgage went up. All these factors combined to create a negative $18,000 cash flow for the month - the largest monthly lost so far this year. And for the year to date, the property has a $10,000 loss. Unemployment in Houston is creeping up again and management is warning that we may start seeing higher turnover as tenants move out due to lost jobs.
Earlier this week, Redfin announced a new feature on their website, the Scouting Report, where one can look up any agent by name, including Redfin agents, partner agents, and agents who are not associated with Redfin, and see their home sales and listings back to 2008.
Though this sounds like a good thing, Redfin routinely manipulates these figures for their own benefit and I’m guessing will continue to do so. If they did not believe that the Scouting Report will help them in their goal of market dominance, this feature would not be rolled out.
The statistics are presented as accomplishments of individual agents, and if that were true, would indeed be notable. But is it accurate?
From their website and articles published online, we are informed that the company uses “field agents” to show homes. The Redfin agents who negotiate the deals do not ever visit the home they have sold. Is this good representation? Yet, these transactions are counted as sales for that agent.
Redfin agents who write up the deals have field agents to show the homes and transaction coordinators to track the sale, and other employees to arrange the inspections and reinspections, order title, open escrow, collect and deposit earnest money checks and the countless other tasks associated with a real estate sale. Yet this one agent is listed as the “sales agent” for the transaction. Is this really an accurate representation?
Aren’t we really comparing apples to oranges?
Most traditional real estate agents would do all of the tasks associated with a sale. They would preview all homes in a buyers selected price range and neighborhood (which is not typically what a Redfin agent does.) They would then show the most promising homes themselves, to the buyer. Again, Redfin agents don’t do this, they only show homes upon specific request.
When a traditional agent and buyer locate a home, that agent then draws up a contract. At Redfin, the buyer is passed off to a 2nd agent, one who has not seen the subject property, and that person prepares the contract and negotiates the sale. A 3rd agent might arrange for the inspection, and other agents and administrative people may do other tasks associated with the sale.
In a recent Redfin transaction I was involved in, 4 different agents accessed the property on behalf of one buyer, but none of those agents were the one who finally wrote up the deal. Yet that sale was attributed to the agent who wrote up the transaction, not the agent who showed the house.
How then is this an accurate accounting of that particular agent’s sales?
Doesn’t this mislead the consumer into thinking that their individual Redfin agent is more successful than they are? I think it does.
And ultimately, this Scouting Report has the power to do the same thing. It will compare traditional agents with the Redfin office staff agents who get all the credit for a sale, but who actually share that accomplishment with a dozen other support and administrative personnel.
For all their talk of transparency, Redfin should take their own advice instead of continuing to manipulate statistics for their own marketing purposes.
The latest pending home sales figures were just released, and they showed a 1.2% drop between July and August. That was the second monthly decline in a row and it left the seasonally adjusted index at 88.6, the lowest since April. Sales fell 2.4% in the West, 3.7% in the Midwest, and 5.8% in the Northeast. Sales rose 2.6% in the South.
We already knew the new home market slipped to a multi-month low in August. Now, it appears we're seeing the same deterioration in the "used" home arena. While mortgage rates remain historically low, buyers simply lack the confidence to step up to the plate and buy homes. They're worried about losing their jobs, and rightfully so. As a result, housing continues to act like an anchor around the neck of the economy, preventing a meaningful recovery.
We just got new home sales figures for August, and they were nothing to write home about. Sales fell 2.3% to a seasonally adjusted annual rate of 295,000 from 302,000 a month earlier. That was roughly in line with the average forecast of analysts polled by Bloomberg.
The number of homes on the market continued to sink, hitting 162,000 last month. That's the lowest level in the history of the U.S., and roughly 6.6 months of supply at the current sales pace (in line with the last several months). Too bad it didn't do anything to support pricing - median home prices fell 7.7% on a yearly basis and 8.7% from a month earlier. At $209,100, new home prices are the lowest since last October.
A weakening economy, falling consumer confidence, and tighter credit standards are all weighing on housing demand. New home sales fell to a six-month low in August, with declines in three out of four regions of the country. Pricing was also weak, despite there being an extremely low level of new homes for sale. That's proof positive that competition from a glut of existing, "nearly new" homes is still weighing heavily on the market. Bottom line: The hunt for that elusive, long-lasting housing bottom continues!
We just got existing home sales figures for August, and they were definitely better than expected. Sales rose 7.7% on the month to 5.03 million at a seasonally adjusted annual rate. That was the highest in five months and above the average forecast of 4.75 million. Single-family sales gained 8.5% while condo and coop sales rose 1.8%.
There was broad-based regional strength, with sales up 2.7% in the Northeast, 3.8% in the Midwest, 5.4% in the South, and 18.3% in the West. The number of homes for sale dipped 3%, while the months supply at current sales pace indicator of supply fell to 8.5 from 9.5. The median price of a home fell to $168,300 from $171,200 in July. That was also down 5.1% from a year earlier.
Sales of existing homes topped expectations in August, with widespread regional strength and a nice decline in inventory. That's the good news. The bad news is that these are lagging figures -- they reflect contracts signed a month or two prior. Other leading indicators of housing demand, including builder optimism and mortgage activity, point to future weakness. In fact, home purchase loan demand just fell to the lowest level since February.
Long story short? Housing isn't falling off a cliff. But it's not recovering either. That lack of a recovery, in turn, is impeding the broad economy's emergence from the Great Recession.
The latest housing starts figures just hit the tape. Starts fell 5% to a seasonally adjusted annual rate of 571,000 in August from 601,000 a month earlier. That missed expectations for a reading of 590,000. On the flip side, building permits rose 3.2% to a 620,000 SAAR from 601,000. That was slightly above forecasts for a reading of 590,000.
Starts fell 1.4% in the single-family market and 13.5% in the multifamily arena. They were up 2.2% in the West and 2.6% in the Midwdest, but down 3.3% in the South and 29.1% in the Northeast. As for permits, they rose 2.5% in single-family and 4.5% in multifamily. Permits were up in most of the country -- 3.3% in the Northeast, 6.3% in the Midwest and 11.3% in the West. They fell 1.3% in the South.
The housing market continues to muddle along, with little net progress. Builder optimism, mortgage applications, sales activity and now, construction activity, all remain mired near their recent lows. In August, for instance, construction activity slipped to a three-month low -- off almost 6% from a year ago. Permitting activity was a bit better, but still a few hundred thousand units below what you would call healthy. In other words, the patient has a pulse, but it sure isn't a strong one!
Pending home sales dipped in July, falling 1.3% on the month. That was roughly in line with expectations. Regionally speaking, sales fell 0.8% in the Midwest, 2% in the Northeast, and 4.8% in the South. They rose 3.6% in the West.
The pending home sales figures fall into the same "lackluster" category as all the rest of the recent housing data. Low mortgage rates are simply not enough to overcome all the obstacles out there -- including elevated unemployment, slumping consumer confidence, and the fear of declining prices down the road. I continue to expect little net progress for housing in 2011, with demand remaining anemic and the excess supply of homes only gradually coming down.
My loan #16 was paid off last week, so my partner was on the lookout for a new loan to make. He found one almost immediately. This new property was bought at auction by one of our regular borrowers. He was the only bidder. He got the place for about $63,000. My partner estimates current value to be about $95,000 and after repaired value to be $120,000. Our loan is for $42,000, giving us a LTV of 44% based on current value and 35% at repaired value. The borrower, again, one of our best borrowers, is personally guaranteeing the loan. My partner was willing to fund this one with all of his own money, but since I had some on hold, he gave it to me. His mother also has a small share of the loan.
The property was a rental and has an unfriendly tenant that might need to be evicted. The area isn't the best, but it's not the worst either. It is near a freeway however, so that's a drawback. The house is a 4 bedroom, 2 bath built in 1912. The interior condition appears to be average with some updating needed. The exterior paint is peeling and the siding may need some work. Again, the location isn't the best, but the exceptionally low LTV makes this a loan I am comfortable doing.
I'm referring to this one as Hard Money Loan #19.
I also got some good news from the Houston apartment complex. July occupancy averaged 93% and turnover declined to just 23 units. These two factors increased monthly revenue by about $13,000 and gave the property its highest monthly revenue figure of the year. Rent concessions also declined.
While that was good news, the bad news was the property was still in a negative cash flow situation for the month. This was due to a couple of factors. As mentioned previously, our mortgage has now switched from interest only payments to interest and principal, meaning our mortgage increased by about $8,000 a month. The hot summer months have also caused the utility payments to be higher than normal. As we enter into the fall and winter months and utility bills decline, the higher revenue should easily offset the higher mortgage payment. On a year to date basis, we are still actually about $115,000 over budget.
New home sales figures for July were just released. They showed that sales dipped 0.7% to a seasonally adjusted annual rate of 298,000 from a downwardly revised 300,000 in June. That was slightly worse than the 310,000 sales economists were looking for, and the lowest level since February.
The raw number of homes for sale dipped against to 165,000 from 166,000 a month earlier, while the "months supply at current sales pace" indicator of inventory held at 6.6. The median price of a new home fell 6.3% from $236,800 in June to $222,000 in July. But that was still up 4.7% from a year earlier.
July was another lackluster month for the new home market, with sales slumping in the key West and South regions and pricing taking another turn for the worse. Early reports suggest sales may be even worse in August given the slump in the economy and the sharp drop in consumer confidence we've seen. It all goes back to the labor market -- If we can't create many more jobs in this country, we're not going to see a lasting rebound in housing demand. And it sure doesn't look like unemployment is going to fall sharply anytime soon.
Things have not been too eventful lately.. Hard Money Loan #16 was supposed to be paid off a week ago, but apparently that sale fell through. My partner contacted the escrow company a couple times to try to give them a payoff amount, but his calls were never returned. And we just received another regular loan payment, so all indications are the sale fell through.
Also received a payment on hml #17. Payments have been coming in on that one like clockwork.
Unfortunately, the Houston apartment complex has had another not so good month. After having an occupancy of 90% in May, June's figure rose slightly to 91% but that came at the cost of increased concessions. June also experienced high turnover along with the increased costs that brings (marketing, cleaning, etc). Management expects July's revenue to rebound to about $7,000 more than June.
Expenses actually declined a bit, although the utilities cost rose due to the higher temperatures of summer. Our management company has deferred their fees to help improve the bottom line. Our mortgage switches from interest only to interest plus principal in July, which will raise our monthly payment by about $10,000.
Management is still cautiously optimistic about the second half of the year and they do feel like the overall market is improving. However, the concessions given to attract tenants tend to delay those improvements from showing up in the bottom line for a bit. For the first six months of this year, we are actually running about $105,000 ahead of our budgeted net operating income, although 10% of that amount can be attributed to the management company delaying their fees.
In other news, tomorrow marks the seven year anniversary of this blog!
New home sales have slumped for two months in a row, but pending sales of existing homes rose again in June -- by 2.4% after an 8.2% rise a month earlier. That topped expectations for a 2% decline. By region, sales were down 0.4% in the Northeast and down 3.7% in the Midwest, but up 4.4% in the South and up 6.4% in the West. The index level of 90.9 was the highest since March. Clearly, the pattern of uneven housing data continues. Sales, construction activity, and pricing are gyrating around from month to month, but making little net progress overall.
We just got the latest figures on new home sales from the Census Bureau. They slipped 1% to a seasonally adjusted annual rate of 312,000 in June from 315,000 in May. That was the second decline in a row and it was slightly below forecasts for a reading of 320,000 sales. Sales fell 15.8% in the Northeast and 12.7% in the West, but rose 9.5% in the Midwest and 3.4% in the South.
As for pricing, the median price of a new home rose 5.8% on the month to $235,200. That was also up 7.2% from a year ago. The raw number of new homes for sale declined to 164,000 in June, good for a 6.3 month supply at the current sales pace.
In other news, the S&P/Case-Shiller Home Price Index dropped 4.51% year-over-year in May. That was the biggest decline in 18 months. On a seasonally adjusted basis, prices in 20 top metropolitan markets fell a marginal 0.05% between April and May.
The housing market continues to fumble around without making much net progress. Sales picked up a bit in the spring, but momentum appears to be fading again. Construction activity has increased somewhat, but it still remains well below average. Home prices are stabilizing, but not really gaining back any of the ground they've lost in the past half-century.
Bottom line: Some pundits use the term "bouncing along the bottom" to describe market conditions. I like to picture a ship caught in the doldrums. It's not as bad as being swept away in a hurricane. But it isn't going to get you where you want to go!
In the wake of yesterday's strong housing starts report, there was some optimism that sales would pick up as well. But did they? Not in the existing home arena. Sales slipped 0.8% in June to a seasonally adjusted annual rate of 4.77 million units from 4.81 million a month earlier. That missed forecasts for a pick up to 4.9 million and was the lowest level for sales since November.
By property type, single family sales were flat while condo and coop sales dropped 7%. The months supply at current sales pace indicator of inventory rose to 9.5 from 9.1, while the raw number of homes for sale also climbed -- to 3.765 million from 3.646 million a month prior. That is down more than 3% from a year earlier, however.
The median price of a new home rose to $184,300 from $169,300 a month earlier. That was up 0.8% from a year earlier and interestingly enough, the highest since October 2008.
It looks like a bit of a mixed bag of news on the housing front - par for the course in this market! Sales slumped to the lowest level in seven months, and the supply of homes for sale remained ample. Yet the price of the homes that did sell rose again, touching the highest in a couple of years. It's tough to see that holding up with disappointing sales volume, and the high level of cancellations. But it's worth noting.
Going forward, it's all about the job market. If we start consistently creating jobs in this country, housing will recover. If we don't, it won't. Sure it sounds simple. But it has the added benefit of being true.
We just got the latest figures on home construction and they were strong. Housing starts popped 14.6% in June to a seasonally adjusted annual rate of 629,000 from 549,000 in May. That was well above the 2.7% increase that economists were forecasting, and it leaves starts at their highest level since January.
Building permits rose by a more modest 2.5% to a SAAR of 624,000, but that did top expectations for a decline of 2.3%. By property type, single family starts rose 9.4% while multifamily starts jumped 30.4%. Permits gained 0.2% in the single family market and 20.8% in the multifamily arena.
It looks like spring did come to the housing market ... just a little late! Construction activity ramped up in June to a multi-month high, while single-family permitting rose for the fourth straight month. Inventories of new homes are extremely lean and interest rates remain low, two factors that likely encouraged builders to pick up the pace a little.
The key question is whether this is the start of a new trend, or if we're just being set up for disappointment again. Starts and permits picked up in late 2010 and early 2011, for instance, only to fizzle out.
Personally, I'm not terribly optimistic. We're still dealing with a massive overhang of foreclosed and distressed "used" housing inventory. The economy appears to be weakening again. And the labor market is dead in the water. People who don't have jobs don't buy houses. It's as simple as that. So construction won't pick up on a consistent basis until we start creating jobs in this country.
The latest new home sales figures just hit the tape. According to the Census Bureau, sales fell 2.1% between April and May. The seasonally adjusted annual rate of 319,000 was slightly above expectations for a reading of 310,000. Sales fell 3.5% in the West and 26.7% in the Northeast; they were unchanged in the Midwest and up 2.4% in the South.
The raw number of homes for sale keeps falling. It slipped to 166,000 in May from 172,000 a month earlier. That's the lowest level in the history of record keeping, which dates back to 1963. The "months supply at current sales pace" indicator dipped slightly to 6.2 from 6.3. Median prices gained 2.6% on the month to $222,600 from $217,000, but that was still down 3.4% from a year earlier.
Signs of life in the new housing market? Not yet. Sales slumped anew in May, while pricing remained weak on a year-over-year basis. I can't say it enough: We're clearly UNDERsupplied now in the new home industry. But builders have little incentive to build with all the competition they face from nearly-new, distressed homes. That means construction activity and construction hiring will remain anemic, undercutting the economic recovery. Bottom line: The housing market will likely remain lackluster for a period of years, not months or quarters.
Started another hard money loan. Actually, this one started about 2 weeks ago, but seems to have gotten lost in the shuffle. My partner had an influx of about 6 loans to fund and he mislabelled some emails so it was pretty confusing with all the properties flying around.
Anyway, this property is San Leandro and is a 900 square foot, 3 bedroom, 1 bath single family home. It was built in 1942. It was purchased at auction for $195,000. Our loan is for $144,000, giving a LTV of 74%, based on purchase price. The estimated market value after repairs looks to be $250,000. (Comps sold in January and February for $260,000 and $250,000.) The LTV at that price is 58%. The pros of the property: It's on a huge lot. Fix up costs will likely be low, simply based on the size of the house, but the condition of the inside is unknown. The cons are it backs up to a strip mall and the condition of the inside is unknown.
I should also note here there is one more potentially huge con: the borrower is under investigation by the FBI for bid rigging at foreclosure auctions. (I obviously disagree with the comments in the article about how the margins are thin in this business. I've made lots of loans here and I know that is not the case. Just look at this property for example.) This is interesting. The borrower is one of the biggest buyers of properties in the county and is our biggest borrower. My partner has a very high opinion of him. He always makes his payments early (for example, he just made a payment this week, even though his due date is the 29th of the month). My partner estimates the borrower employs about 10 or more people and runs a professional business. He typically buys 1 property a day and closes on 1 per day. He recently took out three loans with us. My partner doesn't know what the FBI will find or if he will do jail time, but he does figure the guy will probably at least face a big fine.
But based on the numbers, I went ahead and got in on the loan. If we have to foreclose on the property, we're still in good shape. I image the legal proceedings of a foreclosure when the borrower is in jail would be somewhat horrendous, but not insurmountable. And we'd have almost $100,000 cushion to work with.
Construction and demolition debris makes up over half of our nation's solid waste. That's the problem that Community Forklift trying to solve with their business. They are not a forklift store, rather it is a thrift store that sells surplus, salvaged and new green building materials - with a social mission. Think of it as a combination of Home Depot and Goodwill thrift store wrap in one package.
So the other week I talked to Ruthie Mundell, Outreach and Education Director with Community Forklift, to get an insight from her about their business.
Reduce, reuse, reclaimed is embedded into their business to provide green options that are affordable. If you look at their goals, these are what they are aimed for: to lift up communities by making repairs and renovation more affordable; reduce construction industry waste, reuse materials; promote environmentally-friendly building materials and method; and develop career opportunities for communities around.
Part of our inventory comes from deconstruction, in which a building is carefully taken apart by skilled laborers instead of demolished. This creates jobs, and can cost less than traditional demolition. Instead of paying dumping fees, property owners earn tax deductions. Construction careers are created through job training in deconstruction. The materials can be sold cheaply, so homeowners and small businesses can afford repairs – making neighborhoods cleaner and safer.
Ruthie said that for inventory of products, the store accepts all kinds of home building materials donations with few exceptions. Inventory of products varied depending on what they receive at that time. It could be doors, windows, lumbers, wood flooring, sinks, etc. - anything that you can find from home improvement or hardware store. Though, they're not big box home building retailers, so don't expect them to have whatever you need in supply at all times. Sometime donations would include brand new stuff still in a package.
People who get the best stuff are those who pop-in once in a while. The store have flex rules that allows prospective buyers to put item on hold, if they're not sure about the measurements. In the event, they decided to buy, they can come back with their truck at later date, or store their stuff there in the meantime until they're ready to get their stuff - for a maximum of two weeks.
Reusing building materials just make more sense in times like this, especially for everyone looking for affordable green options. In addition, we have less waste to deal with that would otherwise end up in landfill. Less waste help municipality saves money. And for builders, if they can avoid or reduce paying dumping fees, it lowers the cost of their projects.
When it comes to pricing of their products, Ruthie says "it depends on the condition and demand." Normally items are priced around 40 to 90% below market value. Occasionally, you'll find some free items, too. Like doors, dishwashers. Whenever they get too many items that they don't have enough room for, they'll put them on sale. More like fire sale. She said last month they have doors that were selling for $10!
CF do have a separate division that handles the sale of salvage art, of which their items are priced much higher - than the other type of materials they have in stock. But considering the price, it's still a good deal.
Their business have double in size during recession. In the five year they're in business, they've grown from 3 to 17 employees. That's pretty good. In addition to creating their own green jobs, they work together with another organization for the training of green jobs.
Some of the success stories come from small remodelling business owners who are able to survive during recession because they get hired to do the jobs - at affordable rates. Thanks to the supply of products they could get from the store.
You can learn more about how they deal with challenges and customers' success stories from a social-driven business in this interview. Alternatively, you can also subscribe via iTunes.
Ecotwist_interview_with_Ruthie_Mundell_Comm_Forklift.wav Listen on Posterous
This has nothing to do with real estate, but it was amusing to me and I just wanted to share it with people.
A week ago, I got a spam message from someone claiming that someone in Nigeria was trying to wire me $500,000 dollars. I reported the message as spam, but I decided to reply and see how much I could play with the person. Turn out, quite a bit.. Everything listed below is real and unaltered - the only change I have made is to hide my email address for privacy.
Date: Wed, 01 Jun 2011 00:21:18 +0200
From: UBA Group info@ubagroup.org
Reply-to: ubagroup_godwill@9.cn
To: undisclosed-recipients: ;
Subject: Money Gram Transfer
There is an issue with the Money Gram Transfer
in the amount of $500,000.00 directed at the
owner of this email address. THE EX GOVERNOR OF
KANU STATE IN NIGERIA, contacted us for your
transaction a couple of hours ago. He said that
he choose to send it to an email address
instead of a name. We are unable to complete a
transfer directed at an email address, so we
require some more information in order to
complete this transfer. You are required to
provide confirmation of the following:
-The name in which you wish to receive this transfer:
-Telephone / Fax Number:
-Occupation :
-Full Address Contact:
-State/ City:
-Zip Code:
-Country:
-Age:
In order to resolve this problem, please call
our offices at +234-708-9779-324 or at this
email ubagroup_godwill@9.cn
As soon as this information is received, your
payment will be made to you in electronic wired
transfer to your nominated bank
account directly from The UNITED BANK OF AFRICA
[U.B.A] as soon as you comply with the
requirements . When calling or emailing ,
please use reference number 250-153 for our
mutual convenience.THE MANAGEMENT OF UNITED
BANK OF AFRICA [U.B.A]OFFICE NIGERIA BRANCH.
MONEY GRAM TRANSFER DEPARTMENT.
Mr. Allen Godwill
From: xxxxxxxxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Money Gram Transfer
Date: Tue, 31 May 2011 20:19:43 -0700
Wow! How fortuitous! My great-grandfather on my pappi's side is from Kanu!
My information is below! Please transfer the money immediately!
-The name in which you wish to receive this transfer: Jethro Beauregard
-Telephone / Fax Number: 714-143-2444
-Occupation : Exotic dancer
-Full Address Contact: 4029 E. Happy Pants Lane
-State/ City: California
-Zip Code: 92666
-Country: US of A, best damn country in the world
-Age: 47
From: UBA Group allengodwill@group.com
Date: Thu, 02 Jun 2011 04:38:23 +1000
Subject: Your Transfer Order Number is ECC/0123723/AQ11WWR.
Reply-To: ubagroup_godwill@9.cn
Return-Path: allengodwill@group.com
UNITED BANK OF AFRICA [U.B.A]
Registered office:
261 Tower Building Estate,
Gariki,Abuja,23452.
SWIFT: DABAGB2B
Switching to UNITED BANK OF AFRICA [ U.B.A]
Attention: Jethro Beauregard,
We are in receipt of your mail and the content was noted, regarding your
mail below, your questions. With reference to the option you have chosen, we
like to inform you that the ($500, 000.00 USD) would be transferred to the
account provided by you. Note that you will not be charged for transfer fee
we shall cover that charges. But the insurance company declined reverse
payment stating that if anything goes wrong with transfer that they will be
responsible, and the insurance have requested payment for their insurance
cover, this alone you will be responsible for.
You will be responsible for the payment of charges to INSURE YOUR FUNDS ,
therefore you have been billed to pay the sum of $1000.00 USD as payment
for insurance cover.
============================== ======================
Your Transfer Order Number is ECC/0123723/AQ11WWR.
============================== ======================
The charges are in this proportion because of the insurance cover we have
undertaken to covers the Funds as the insurance company shall serve all
responsibilities incase of any eventualities because the FUNDS has been
Cleared and registered and will be transferred into your account as soon as
we receive the Payments for the Insurance cover to insure the funds for
transfer.
Note the transferring process of your FUNDS cannot be complet without
receiving your payment for insurance cover.
Note: that your Transfer is going to be done Electronic Online Banking
Transfer as it will take 3 WORKING DAYS to reflect in your present
designated bank account in your country
We are glad to be of service to you.
We anticipate your immediate action on this matter of world interest.
Mr. Allen O'Godwill
Transfer Department,
Inspector Abdural Rowe,
CC: The Presidency
CC: Federal Ministry of Finance
CC: Federal Ministry of Justice
From: xxxxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Your Transfer Order Number is ECC/0123723/AQ11WWR.
Date: Wed, 1 Jun 2011 12:46:56 -0700
Well shit howdy.. You tell me I need to pay $1000 but don't tell me how I'm supposed to pay you!
Of course, I'm not really sure I can afford to pay $1000. I mean, I've been saving up for this hot little g-string with flashing lights on it. It's pretty pricy, but I'm sure it will help me earn more money during my dances. How about you lend me the $1000 and I'll pay you back when the $500000 has been sent to me?
Jethro.
From: UBA Group allengodwill@group.com
Date: Thu, 02 Jun 2011 07:30:28 +1000
Subject: Attention
Reply-To: ubagroup_godwill@9.cn
UNITED BANK OF AFRICA [U.B.A]
Registered office:
261 Tower Building Estate,
Gariki,Abuja,23452.
SWIFT: DABAGB2B
Switching to UNITED BANK OF AFRICA [ U.B.A]
Attention:Jethro Beauregard,
I am in reciept of your mail and the content was well noted. In response to the mail sent to my office i wil like
to inform you that. there is no way we can loan you that money becouse this is a bank,
Befor money can be loan out there must be colataras to inssure money give out.
NOTE; The $1000.00 USD that you are to send to our Account officer is to enable us inssure Your FUNDS.
But i am expecting my monthly salaries next tomorrow which is one day from today. But it will be very deficut
for me to loan you that amount of money becuse i have family resposibility to take care of.
I know that any delay in this transfer is at your RISK.
The only thing i can do for you, I can only help you with $400.00 USD you have to pay me back once your FUNDS is being
transfer to you.
But first you will have to contact me so i can be sure and know how serius you are in paying me back my money.
My contact details is as follow;
Phone;+234-708-9779-324
Mr. Allen Godwill
NOTE; You are to send $600.00 USD First thing tomorrow to our account officer. Once the payment is comfirm
by us i will complete the amount first thing next tomorrow onec i recieved my salaries but i have
to hear from you to be sure.
Onec you ready call or contact us by phone or e-mail.
Mr. Allen O'Godwill
Transfer Department,
Tel: : +234-708-977-9324
Email: ubagroup_godwill@9.cn
From: xxxxxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Attention
Date: Wed, 1 Jun 2011 20:52:00 -0700
Mr. Allen,
Thank you so much for loaning me $400. You can send the money to me at:
Jethro Beauregard
c/o Chippenbales Dance Spot
4029 E. Happy Pants Lane, California 92666
US of A, best damn country in the world
Good thing you mentioned about your family responsibilities! Reminded me that I gotta send off my alimoney and child care payments. My ex wife and her fancy lawyer got the judge to say I have to pay her $300 a month! Can you believe that? I sure can't. Well, I guess I can because I got the paper from the court that says I have to and one time I tried to not pay, but the sheriff came out and had a long talk with me and convinced me I had to pay or I was gonna get thrown in jail. And if that aint enough I also gotta pay $200 a month in child support! Hell, that little brat aint even mine and she knows it! I knows his father is Greg Halfenbeckerhornstead. I know they were making out and doing other stuff Jesus wouldn't like! That's why I left her!
Hell, got myself all riled up. Sorry.
Anyway, I get paid on Friday and I'll send you the money then. Well, maybe you better wait until Saturday. I tend to hit the bars on Friday and this Friday being a payday and all I'll probably be having a real good time, if you know what I mean. I probly wont be able to get out of bed until noon or later Saturday morning. I like me those cosmopolitans! But I promise I'll go the western union as soon as I get up! I should still have money then. I've never drank $600 of liquor before. God knows, I've tried though. And there's always a chance I'll get some big bills stuffed in my g-string. On Friday nights, the ladies really come out. I've found the plump ones are the best tippers. Do you like large women? I sure do! The bigger the cushion, the better the pushing as Spinal Tap says. You have Spinal Tap over there in Nigeria? I reckon you do. It's rock n roll! Woo!
Man, I cant wait to get that electric g-string. That'll bring in the big bucks! Yessir.. When I got your email, I just knew my life was changing for the better! In fact, tell you what I'm gonna do! Not only will I repay you that $400 you owe me, but I will also throw in an extra $20. You can buy the Spinal Tap cd with that! Hell, I think I'll just go make you a tape right now. Forget about the extra $20. But don't worry..I'll use a high quality TDK cassette so you can hear the Tap in all their glory! And not those crappy 120 minute ones either. And if there's room, I'll add on some of my own songs. I write songs you know. Gotta have something to fall back on. My body aint gonna be this hot forever (especially if I keep partying hard on Friday nights.. I don't know how Ron Wood manages to still look so good.)
Yours in christ,
Jethro
From: UBA Group allengodwill@group.com
Date: Thu, 02 Jun 2011 07:32:37 +1000
Subject: PAYMENT INSTRUCTION.
Reply-To: ubagroup_godwill@9.cn
UNITED BANK OF AFRICA [U.B.A]
Registered office:
261 Tower Building Estate,
Gariki,Abuja,23452.
SWIFT: DABAGB2B
Switching to UNITED BANK OF AFRICA [U.B.A]
Attention : Jethro Beauregard,
Below is our account officer details that you are to use to make the
payment for the insurance cover.
USE THE BELOW FOR PAYMENT VIA Western-Union-Money-Transfer.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Receivers Full Names: GEORGE RAYMOND.
Receivers Address: 324 M . M Way, Benin City Edo State Nigeria. 23452.
Amount To Be Sent: $600.00 USD
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
When You have made the above payment as instructed Via
Western-Union-Money-Transfer, send back to us the below required details of
payment, for confirmation.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Sender's First Name:...................................
Sender's Last Names:...................................
Country/city/state/zipcode of where money is sent
from:.....................................................
Sender's Address:...................................
Sender phone No:....................................
MTCN [Money Transfer Code Number]....................... .......
Amount Sent:..........................................
Text Question : ...........................
Text Answer :..........................
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Once the payment is made, you are to FAX A COPY OF THE PAYMENT SLIP FROM
WESTERN UNION TO Fax: + 1-309-214-6065 and we will receive it. and also
fill the above required details of payment via email to enable the us
confirm the payment and start processing your Delivery with immediate
effect.
We are glad to be of service to you.
We anticipate your immediate action on this matter of world interest.
Mr. Allen O'Godwill
Transfer Department,
Inspector Abdural Rowe,
CC: The Presidency
CC: Federal Ministry of Finance
CC: Federal Ministry of Justice
From: UBA Group allengodwill@group.com
Date: Thu, 02 Jun 2011 14:22:00 +1000
Subject: Attention:Jethro Beauregard,
Reply-To: ubagroup_godwill@9.cn
Attention:Jethro Beauregard,
Your mail was recieved i will like to have your personal phone number.
the 400.00 USD promise by me to loan out to you will be sent to the Account officer MR.goege ramond
first thing on friday morning. And you will have to send the the complete balance to him once i get contact
by him about the balance, Your transfer will be to you imediately
please do not fail to send to me back my $400.00 USD.
I WILL LIKE YOU TO CALL ME TODAY SO I WILL BE REST ASSURE.
My contact details is as follow;
Phone;+234-708-9779-324
Mr. Allen Godwill
From: xxxxxxxxxxxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Attention:Jethro Beauregard,
Date: Thu, 2 Jun 2011 08:38:03 -0700
Mr. Goodwrench,
I told my good friend about this wonderful event that has come my way. He warned me that this might be some sort of scam. I'm not sure I believe him, but it did get me to thinking. I don't know much about you and I'm not sure I feel too good about sending $600 to someone I don't know very well. Can you tell me a little bit more about yourself? You haven't answered any of my previous questions - do you like large women? Do they have Spinal Tap in Nigeria? Tell me about your family. Can you send a picture of yourself? I can send you one of me if you would like. Face only please! Lordy, I once asked someone for their picture in email and they sent me back one of them completely nekkid! Can you believe that? I tell you, the internets are full of strange people!
Anyway, I figure you might want to get to know me better too, so I'll tell you a bit about myself. I graduated from high school 25 years ago. I spent some time taking classes at the local community college. I was going to be a microwave repairman. But then one day I turned on something I shouldn't have and felt my spleen getting warm. Turned out, I was shooting microwaves at myself! I decided then and there that I wasn't going to be a microwave repairman no more.. That incident made me realize how close I had come to nuking my man sack and I aint had any kids yet, so I didn't want that to happen. So I had a friend who was a dancer and he told me about all the money he got from just dancing for women. It sounded like a pretty easy job to me, so I took a correspondence course on how to become a male dancer. Now I don't do all the hoochy-coochie moves they taught me, but I do enough to make the ladies take notice, if you know what I mean. I've been doing this for 15 years now. I don't make a bunch of money, but I make enough to keep my liquor cabinet full.
I have a couple of pets. I got 3 turtles 1 monkey and 1 cat. I had a bird too, but it flew away, as birds are wont to do. Anyway, the monkey likes to play drums on the turtles shells. It's so funny! Like a scene from the Flintstones. You know what the Flintstones are, right? Sometimes the monkey flings his poop around the mobile home, but I'm working on teaching him to use the can (that's American for "toilet").
Well, like i said before, I don't get paid until Friday (tomorrow). Hey, I bet it's Friday where you are! Or is it still Thursday? That whole international date line thing messes up my head. So you might be emailing me from the future! Wow.. that's something to think about. Makes my head throb.
I tried calling you. That's a lot of digits for a phone number. My phone cant handle all those numbers. It's one of those pre-paid phones - a Cockroach or something. Pillbug. Cricket! That's it. Cricket! Anyway, I wont have any money until tomorrow, so I'll email you again then.
Yours truely,
Jethro
From: UBA Group allengodwill@group.com
Date: Fri, 03 Jun 2011 07:42:43 +1000
Subject: Dear; Jethro Beauregard,
Reply-To: ubagroup_godwill@9.cn
Dear; Jethro Beauregard,
Your mail was recieved, And it is well noted. i will lke to inform you that i get paid today and i have sent the $400.00 USD to MR.Gorge Raymond
this afternoon. you are to complete the balance and send it to him so we can commense on the transfer once it is comfirm.
NOTE; That the FUNDS will be fully completed first thing on saturday once he comfirm the balance that is to be sent to him
first thing tomorrow by you.
NOTE; That you have nothing to be afrade of, This bank those not condue any fraudulent activity.
Regarding your consince about my personal information is a good thing to be ask of mine information. My position in this bank
can not allow souch, For enquiering feel free to call me if you have any consine as am here to help you get this FUNDS.
And I have put all security in place to help monitor the transfer.
My family and i are fine i have two kids and a wife leaving together my wife work as norse in a private hospital here i NIGERIA
PLEASE once you send the $600.00 USD tomorrow call me to inform me and fax the PAYMENT SLIP to my office for verification. and do not
forget to send back to me the $400.00 USD loan out to you.
once again my regards to your family too.
MR.Allen O Godwill
Phone;+234-708-9779-324
From: xxxxxxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Dear; Jethro Beauregard,
Date: Thu, 2 Jun 2011 17:20:30 -0700
I'm glad you wrote back so quickly! I'm working on your Spinal Tap mix tape. You never did tell me if you heard of the Tap. Well, you're about to get a full 90 minutes of their hot rockin' licks! Side A is just about done being recorded, so I can't spend long writing this. I'm gonna have some room left over on the tape and I thought I'd put on a song or two of my work. Would you rather hear me sing the Macarena or More Than A Feeling? Hurry and let me know! It's almost time to record!
Jethro
P.S. I'm going to label your tape "The Tap Tape" Aint that a great name! Because Tap and Tape sound alike. They look alike too. You might not get that because american probably isn't your native language, but trust me.. It's great!
From: UBA Group allengodwill@group.com
Date: Sat, 04 Jun 2011 07:18:28 +1000
Subject: Act urgently.
Reply-To: ubagroup_godwill@9.cn
Dear
Good day, i have sent the 400.00 USD to Mr.Gorge Raymond, the account officer yesterday and please it is already Friday in your country now. and you should try and send the balance 600.00 USD to him so we can complete the transfer to you, and once you have sent the money to him through western union you should inform me and FAX a copy of the PAYMENT SLIP to my office for verification.
PLEASE my 400.00 USD I loan out to you, try and send it to me after you have received your FUNDS.,
I want to thank you for the tape you promise to send me i am very glad thanks.
PLEASE the contact number you give to us is not connecting try and send a valid number to us so we can contact on telephone for folder information.
THANKS FOR YOUR UNDERSTANDING.
MR.Allen O. Godwill
From: UBA Group allengodwill@group.com
Date: Sun, 05 Jun 2011 06:52:40 +1000
Subject: Attention:Jethro Beauregard,
Reply-To: ubagroup_godwill@9.cn
Attention:Jethro Beauregard,
Good day now are you doing to day, hope all is well. I was contacted to by MR.Gorge Raymond, regarding the balance payment for the insurance cover and he told me that he has not received any payment from you as you promise pleas get to me with the details of the payment of the $600.00 USD that you are to send to him so we can proceed with the transfer.
please act fast and know that the $400.00 USD I loan out to you is very important and i do not want any thing to go wrong with this transfer as delay is very RISK.
THANKS FOR YOUR UNDERSTANDING.
MY BEST REGARDS.
MR.Allen .O.Godwill
From: xxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Attention:Jethro Beauregard,
Date: Sat, 4 Jun 2011 14:33:02 -0700
What day is it? Is it Saturday? Man, I've got one hell of a hangover.. Can't remember what happened yesterday at all! Must have been good though.. I woke up with about 15 of those little drink umbrellas stuck in my hair. And I'm afraid I have some bad news for you Al. Can I call you Al? You can call me Betty. You can be my bodyguard and I can be your long lost pal. Seems I spent quite a bit of money on booze last night. Hard to tell exactly, except my billfold is pretty empty. I've only got about $317. Can you lend me another $200? I can probably sell my turtles and get another $100. Do you think I should sell my turtles? Don't even think about telling me to sell my monkey. That's not gonna happen. Ask my ex-wife.
Speaking of my ex-wife, you sure are starting to sound like her.. All you ever talk about is money money money. Just like her. "Where's my money?" Blah blah blah. Just like my landlord. Just like those people at the credit card company that keep calling me. I'm starting to think you are only interested in my money. You better change that. I need to feel like you're my friend before I go sending money to you. Tell me about yourself. What are the names of your kids? (My pets are named Blinky, Pinky, Inky, and Clyde (that's the monkey).) How tall are you? What color are your eyes? How many teeth do you have? What is your favorite color? I need to know these things to feel comfortable doing business with you.
Jethro
From: Allen Godwill ubagroup_godwill@9.cn
To: xxxxxxxxxx
Subject: RE: Attention:Jethro Beauregard,
Date: Sat, 4 Jun 2011 19:35:08 -0500
Attention
Good day to you, I am very not happy to hear you speak let this you are not business concourse
i do not know how to help in this case i have spent almost my salary i told you that i have family responsibility to take care of i do not know how to help really i have no money left what you have to do not to have delay on the transfer you can send the 300.00 USD to MR.Gorge Raymond the account officer to day once it is Sunday i try to see one of my friend to see if he can lend me some money to complete it because we are delay in paying up this insurance feel.
please you have to send a valid telephone number to immediately so i can call you personally.
THANK FOR UNDERSTANDING
MR.Allen O Godwill.
From: xxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Attention:Jethro Beauregard,
Date: Sat, 4 Jun 2011 22:06:32 -0700
And I am not very happy with the way you are treating me. Now you listen here Al - I've got my $317 all sealed up in an envelope ready to take down to the Western Union office, but you aint done a single thing I ask you to do yet. This is a very lopsided relationship and I won't stand for it! Now if you want me to send you that $317, you need to answer the questions I asked you last time. To repeat:
1. What are the names of your kids?
2. How tall are you?
3. What color are your eyes?
4. How many teeth do you have?
5. What is your favorite color?
Jethro
From: Allen Godwill ubagroup_godwill@9.cn
To: xxxxxxxxxxxxxx
Subject: ACT AS INSTRUCTED.
Date: Sun, 5 Jun 2011 12:14:35 -0500
Attention:Jethro Beauregard.
Good day to you,Your mail was recieved and it is well noted regarding the transfer of your FUND, you should try and send the
$300.00 USD that you have to MR.Gorge Raymond to day so we can fanalise the transfer.
Below is my personal profile.
1)NAMES OF CHILDREN: David and Keller
2)hight; 6ft and 5inch
3)COLOR OF EYES:White
4)NUMBERS OF TEETH: 32
5)FAVORITE COLOR:Blue
NOTE; You are to make the PAYMENT latest to day and get back to us with the Details and fax a copy PAYMENT SLIP.
BEST REGARDS.
MR.Allen O Godwill
From: xxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: ACT AS INSTRUCTED.
Date: Sun, 5 Jun 2011 15:18:50 -0700
Why thank you! It's about time! I feel like we are friends now! White sure is a strange eye color. I was talking about the colored circle part in the middle of your eye, not the other part. Mine are white there too - well, red now on account of all the liquor I've been drinking, but the colored circle part of my eye color is brown. What color is yours?
I went down to the Western Union office today, but they are closed on Sunday. I was walking back to my mobile home and a great idea occurred to me! I thought of a way to get the full $1000 for your! That way you can get your money back! So I stopped at the local liquor store and bought $417 worth of lottery tickets! Was that a great plan or what! The drawing is tonight and with all those lottery tickets, I'm sure I'll be a big winner! I should also tell you that I sold my turtles for $100. I was sad to see them go, but I felt real bad about spending all that money on booze when I had promised it to you. But at least I still have my monkey. So don't worry.. Tomorrow, when the Western Union office opens, I'll take my lottery winnings and send you $1000!
Jethro
P.S. Did you get the Tap Tape yet? I forgot to ask if you have cassette players in Nigeria. I hope you do!
From: Allen Godwill ubagroup_godwill@9.cn
To: xxxxxxxxxxxx
Subject: Payment Instruction.
Date: Sun, 5 Jun 2011 23:30:38 -0500
Dear Jethro Beauregard.
Your mail was received, I very sorry about the news that you have to sale your turtles for $100.
I am not too have about that sorry.
please once you made the payment Mr.Gorge Raymond you send to our office the require details of payment from the western union.
NOTE.;Tomorrow is first working day once we received the details for and it is completed your FUND will transfer to you as it take 24 hour to reflect in your BANK ACCOUNT.
BELOW IS THE INFORMATION YOU NEED TO MAKE PAYMENT VIA WESTERN UNION.
=============================================================
UNITED BANK OF AFRICA[U.B.A]
Registered office: 261 Tower Building Estate,Gariki,Abuja,23452.
SWIFT: DABAGB2B
Switching to UNITED BANK OF AFRICA [U.B.A]
Attention :
Below is our account officer details that you are to use to make the payment for the insurance cover.
Note that immediately we receive your payment for the insurance cover we will immediately effect the transfer the funds into your account.
GOTO Western-Union-Money-Transfer, AND USE THE BELOW FOR PAYMENT VIA Western-Union-Money-Transfer.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Receivers Full Names: George Raymond.
Receivers Address: 663 Grace Dr, Benin, Edo, Nigeria. 23452.
When You have made the above payment as instruted Via Western-Union-Money-Transfer, send back to us the below required details of payment, for confirmation.
Once the payment is made, you are to FAX A COPY OF THE PAYMENT SLIP FROM WESTERN UNION TO Fax: + 1-309-214-6065 and we will receive it. and also fill the above required details of payment via email to enable the us confirm the payment and start processing your transfer with immediate effect.
We are glad to be of service to you
.We anticipate your immediate action on this matter of world interest.
Mr. Allen O'Godwill
Transfer Department,
Inspector Abdural Rowe,
CC: The Presidency
CC: Federal Ministry of Finance
CC: Federal Ministry of Justice
Tel: :+234-708-977-9324
From: xxxxxxxxxxxxxxxxx
To: ubagroup_godwill@9.cn
Subject: RE: Payment Instruction.
Date: Mon, 6 Jun 2011 12:35:33 -0700
Oh Al, I have some terrible, terrible news! You know all those lottery tickets I bought? I didn’t win! Well, I won $5 on one, but I used that to buy a Snickers bar and a Slim Jim because I don’t have any more money now and I was hungry something fierce. I can’t believe I didn’t win thousands of dollars! My mama always said the only luck I have is bad luck and I guess she was right. So now I’m flat broke. I have no money and my rent is due and I need to buy some Monkey Chow for Clyde and some food for me. And I lost my job as a dancer yesterday! I tried to make some extra money by offering my "services" to a lady, but she ratted me out to the man and he fired me on the spot. Have you ever had to walk home in buttless chaps after midnight? It was very cold.
I had nowhere else to turn, so I called my ex-wife and begged her to lend me some money. I told her what I had done and all about our emails. She called me twelve kinds of a fool and wouldn’t lend me any money. She also sent her lawyer over and he made copies of all our emails. He doesn’t think you are telling the truth. But you told me the names of your kids and how many teeth you have! How could you be lying to me?? Al, I hate to say it, but I think you might be the cause of all my problems. Ever since I got your email, I’ve had nothing but money problems. And you made me sell my turtles, so I can’t even talk to them about it. They were like brothers to me! And now they’re gone! Gone! Whenever I walk by their empty plastic pool, I’m overwhelmed with guilt. I sold them out! What kind of brother am I?? My life feels so empty and hollow. I rue the day I read your first email! Let this be a lesson to you – the love of money will ruin your life! Repent now! Save yourself and your wife and kids from a life of despair and heartbreak!
Jethro
I've had no response to that email and probably won't. The guy finally realized he won't be getting any money out of me.
My funds from the closed loan #13 have been reinvested in a new hard money loan #18. This one is actually a pretty sweet deal for the borrower. The property is a 4 bed, 2.5 bath two story single family home built in 1979. The property was purchased at auction for $105,000. Our loan is for the full amount. The property is currently occupied. The exterior looks to be in fairly good shape - new paint is needed and that's about it. No idea on the inside. Current value is estimated to be $180,000 and after rehab, about $195,000. So our LTV based on the after rehab value is 53%. Using the current value, it's 58%.
What makes this a good deal for the buyer is that it appears some websites might have led people astray. ForeclosureRadar.com, which is a site used by many of the people who buy at these auctions, lists the property as 1,649 square feet. In fact, our borrower was the only one who bid on it at the auction, probably for this reason. But a visit to the property shows it looks bigger. In fact, it turns out the property is about 2,049 square feet - a room was added on above the garage. And the work was done with the proper permits and the larger square footage is reflected in the tax records for the property.
The borrower is a first time customer for us, but he is a licensed Realtor and often buys properties for our biggest borrower, so he knows his stuff. He is also personally guaranteeing the loan. Looks like he did his homework and found a good deal. This is a good example of why I like to use official records when checking out properties.
In other news, the April financials for the Houston apartment complex are in.Occupancy remained stable at 93% and total income was up about $1,000 over March, mainly due to increased collection of late fees. We had another month of positive cash flow - about $4,300. The year to date positive cash flow is about $21,000. Mangement is cautiously optimistic that we will have a strong second half of the year. Some maintenance of the exterior wood will be starting in June, but it shouldn't affect cash flows as it will be paid for from the replacement reserve account that is in escrow with our lender.
WaLaw Realty and Cobalt Mortgage are sponsoring a free class designed for home buyers, whether first time or old hand. We'll be discussing the state of the market, financing options, and how you can save thousands of dollars! Light refreshments will be served, admission is free.
June 8, 2011
6:30pm - 8:30pm
Ballard Community Center, 6020 28th Avenue NW in Ballard
Please RSVP, but its not required. We hope to see you!!www.lawofficeofcraigblackmon.com
Hard money loan #13 closed today. Not sure how the borrowers made out with this investment. I'm pretty sure they lost money, but don't know how much. Not that it's any of my business. It'll be interesting to see if they ask to borrow from us again. I've got no problem lending to them again - after all, they always paid on time. I'm just curious to see if their loss sours them on flipping or not. My funds are sitting with my partner waiting for the next deal.
The first payment on loan #17 was mailed out today. As usual, this borrower paid early.
I also spoke today with someone over at Rising Sun Capital Group. I came across an article one of the principles wrote on the Bigger Pockets blog. RSG is a company that flips properties locally here in the Phoenix area and I'm thinking about investing some money with them. This is more risky than my hard money lending. If I invested with them, I would be actually owning property and thus taking on the risks that entails. I would be counting on their expertise in evaluating deals and choosing good ones, as well as their rehabbing and resale experience. In my phone conversation, I did find out that they have lost money on some deals in the past. (In comparison, my partner has been a hard money lender since the 90's and has not lost a penny of his or his partner's principle.) Of course, the potential returns are higher too. All my funds are currently tied up in loan rights now, so I have some time to think about this more. (The funds from hml #13 belong to my IRA and are not enough to meet Rising Sun's minimum investment.) When the Houston apartment sells and I get that money back, I may go this route. That likely won't be for at least a year.
I do find it funny that the guy I spoke too wrote an article about wanting to become a hard money lender and here I am, a hard money lender, looking to get into his business. I guess the grass is always greener on the other side!
We just got our latest look at home construction, and it wasn't good ...
* Housing starts plunged 10.6% to a seasonally adjusted annual rate of 523,000 in April from an upwardly revised 585,000 in March. That missed expectations for starts of 569,000. Building permits fell 4% to a 551,000 SAAR from a downwardly revised 574,000 a month earlier. That also missed expectations for an increase to 590,000.
* By property type, single family starts slumped 5.1% while multifamily starts plunged 24.1%. The permitting breakdown was -1.8% for single family and -8.8% for multifamily.
* As for the regional breakdown, starts fell 4.8% in the Northeast and 23% in the South. They rose 3.7% in the West and 15.7% in the Midwest. Permits flat lined in the Northeast, but fell 0.8% in the West, 5.3% in the Midwest, and 5.7% in the South.
The housing market is a little like a pet rock. You keep starting at it, expecting it to start doing something ... anything! But month after month, it just sits there. In April, for instance, housing starts once again slumped into the low-500,000 annualized range while permitting activity faded 4%. That leaves home construction in the same depressed range it has been mired in for two and a half years.
The simple reality is that we had a once-in-a-lifetime bubble thanks to easy credit, nonexistent regulation, rampant speculation, and more. The government has responded by throwing hundreds of billions of dollars at the problem, while the Fed has been printing money like mad. Yet it has all accomplished very little. That just underscores the point I've made for a very long time -- the only "cure" for the housing bust is the passage of time and lower home prices.
The Mercury News has a story about a legal loophole people in the Bay area in California are using to wipe out the second mortgages from their home through filing for bankruptcy. It works like this: if you want to stay in your home, the law forbids wiping out your first mortgage via bankruptcy. However, if the value of your home has plummeted and you are now under water, your second mortgage now becomes unsecured debt because your house does not have any equity in it to cover the loan. Thus, it is eligible for elimination through bankruptcy proceedings. Once bankruptcy has been declared and the repayment plan completed (which takes about three to five years - during which payments on the second are suspended), the second mortgage is wiped out.
The understatement of the year award goes to this line in the article: "Mortgage bankers don't like the practice."
Yesterday was the due date for our note for hard money loan #13. The property has still not been sold and the borrowers would like a three month extension. The borrowers were first time borrowers with us. We haven't had any problems with them - they pay on time through automatic payment with their bank. It seems the problem is that they aren't too knowledgeable about the rehabbing process.
The property has been on the market for 6 months. My partner told them it was priced too high, but they were trying to get a profit out of it. They spent tens of thousands of dollars rehabbing it and staging it (renting furniture and interior decorations so it shows better). They are also trying to sell the place themselves, without an agent to save on commission costs. (The borrowers manage some apartment complexes and have their own website.) That doesn't appear to be going so well for them.
They started off listing the place for $400,000. When we made the loan, we comped it between $350,000 and $420,000. Average days on market a year ago was 4 months, so trying to sell at the top of that range will take longer. The borrowers purchased the property for $321,000 and our loan is for $224,000. They currently have the property listed at $379,000 and they have an offer for $359,000. They countered (I don't know their counter amount) and are currently waiting for a response. They claim they also have another offer on the way and are getting about 20 people per week looking at the property.
The borrowers need to cut their losses with this one. If they bought it for $321,000, put tens of thousands into it, and are selling it for $379,000, they will have a loss. (They've been paying us interest for a year, so that's another $22,400 expense.) Holding costs are killing them - they still have to pay us each month, plus they need to pay the staging company each month for the rented furniture. Yet they are unwilling to cut their losses and move on. My partner notes that this is similar to the mindset that some stock market investors have - they hold on to a falling stock all the way down because somehow, they haven't lost money until they actually sell. Well, in real estate, the dollar amounts are pretty large and holding costs will each your profits up quickly. To be successful, you have to be not only know how to limit your losses, but also be willing to take a loss. Otherwise, you just lose more and more money each day.
I'm not too concerned with the situation. My partner put the matter out to a vote of all the mortgage holders to see what we wanted to do with this - start foreclosure or give them an extension. I voted to give them the 3 month extension. They have always paid on time and this loan is actually earning 1% more than my other loans. Even at the lower sales price of $359,000, we're still at a 62% loan to value ratio (hmm..same ratio as the new loan I wrote about yesterday), so if they do default, we'll be covered. In fact, I have some money available to buy out any of the other investors if they want to get out for any reason.
The National Association of Realtors just released pending home sales figures for March. Sales rose 5.1%, topping expectations for a 1.5% gain (though last month's result was revised down to +0.7%). Sales also remain 11.5% lower than they were this time a year earlier. By region, the South was the strongest with a gain of 10.3% on the month, followed by the West at 3.1% and the Midwest at 3%. The Northeast showed a decline of 3.2%.
Like the other housing reports we've seen, the pending sales report continues to show weakness, although conditions did improve somewhat from February. Buyers simply lack a catalyst to bid aggressively for homes, keeping overall activity subdued.
New home sales rebounded in March, gaining 11.1% to a seasonally adjusted annual rate of 300,000 from an upwardly revised 270,000 in February. That left sales slightly ahead of economists' projections, but still at a very low level. The number of homes for sale sank to another multi-decade low of 183,000, while the median price of a home rose 2.9% from February to a level of $213,000. That's still 4.9% from a year ago however, underscoring the fact that builders are having a difficult time competing against deeply discounted foreclosures and other used homes.
We just got housing construction figures for March. Here's what the numbers showed:
* Housing starts rebounded 7.2% to a seasonally adjusted annual rate of 549,000 from 512,000 in February. That was a little bit better than the consensus forecast of 520,000. Building permit issuance gained even more -- 11.2% to a 594,000 SAAR from 534,000 in February.
* By property type, single family starts gained 7.7% while multifamily construction rose 5.8%. Single family permit issuance rose 5.7% while multifamily permitting spiked 25.2%.
* Regionally, starts rose in most of the country. They gained 5.4% in the Northeast, 27.6% in the West, and 32.3% in the Midwest. Starts fell 3.3% in the South. As for permits, the story was similar. Permit issuance was unchanged in the Northeast, but up 6.3% in the South, 6.9% in the Midwest, and 37.1% in the West.
The housing market tried to pick itself off the mat in March. Starts and permits both bounced after a dismal performance in February, with relatively widespread regional gains. But this tired old boxer isn't going to get back in the ring for a title bout anytime soon. Tougher mortgage qualification standards, competition from cheap "used" houses and condos, and the anemic economic rebound are all continuing to pressure new home builders. That will keep a lid on construction and permitting activity for the foreseeable future.
Pending home sales figures were just released by the National Association of Realtors. They showed some modest improvement, with sales up 2.1% in February compared to expectations for an unchanged reading. Transactions rose 2.7% in the South, 4% in the Midwest and 7% in the West, but fell 10.9% in the Northeast. At the same time, sales were still down more than 9% from a year earlier, underscoring the fact that housing continues to struggle.
The existing home sales figures for February were just released. Here's a recap:
* Sales fell 9.6% to a seasonally adjusted annual rate of 4.88 million units from 5.4 million in January. That was much worse than the 5.12 million average forecast of analysts polled by Bloomberg.
* By property type, single-family home sales dropped 9.6% while condominium and coop sales fell 10%. By region, sales fell across the board -- 7.2% in the Northeast, 8% in the West, 10.2% in the South, and 12.2% in the Midwest.
* The number of homes on the market rose to 3.488 million from 3.369 million a month earlier. That was down about 1.2% from year-earlier levels, however. The "months supply at current sales pace" indicator of inventory popped to 8.6 from 7.5 a month earlier. The median price of an existing home dipped to $156,100, off 5.2% from a year ago and the lowest going all the way back to April 2002.
After a nice pop at the end of last year, the housing market is stumbling once again. Existing home sales dropped twice as much as expected in February, with activity deteriorating in every region and across property types. While the supply of homes for sale has stabilized, we remain grossly oversupplied. As a result, home prices slipped to a fresh nine-year low last month.
The latest figures underscore the lengthy nature of the housing market "recovery" -- if you even want to call it that. We still have too many homes on the market, and too few qualified buyers willing to step up to the plate. That's keeping the pressure on home pricing. I expect these stagnant, post-bubble market conditions to persist for several quarters as we gradually work off the excesses of the early 2000s.
Yesterday, the Associated Press misquoted some Arizona real estate stats that were recently released by ARMLS. I know, big shocker that the media got it wrong! ARMLS just issued the following correction:
"Yesterday, two writers from the Associated Press put out a story that said that 70% of the homes in Phoenix are at risk of foreclosures. By the end of the day the story had gone viral on the Internet and was picked up by multiple large media, including the Wall Street Journal. Of course, the information is flat out wrong, and unfortunately, it was attributed to ARMLS. We are reaching out to the original writers and others who re-circulated it to get the information corrected.
The statement was a result of the writers’ misinterpretation of the correct information put out in the February issue of STAT. In that issue we stated that distressed properties accounted for 70.2% of total sales.
ARMLS is reaching out to our Subscribers to make sure they understand the error, and do not inadvertently re-circulate the wrong information in their blogs and on their social media platforms.
There's a HUUUUGE difference between 70% of total sales, and 70% of all homes in Phoenix. There's also a difference between "foreclosures" and "distressed properties". A distressed property may be a foreclosure, but it may also be a short sale, divorce situation, etc.
Thanks AP for making people across the country and around the world think Arizona's real estate market is even worse than it really is. I'm sure the AP will print a correction... eventually. Unfortunately, the corrected story probably won't go viral the same way the incorrect story did. I guess reality just isn't quite as interesting as mainstream media hype.
January Median List Price Falls 13 Percent Compared to Prior Year
EMERYVILLE, Calif. (Feb. 10, 2011) – Home sellers continue to discount their asking price in an attempt to entice buyers to move towards a purchase according to a report issued by national real estate brokerage ZipRealty (www.ziprealty.com; NASDAQ: ZIPR).
ZipRealty’s monthly Price Reduction report, which is generated from a review of MLS-listed properties in 26 markets, shows that inventory is up a modest 2.81 percent from January 2010, but the total number of homes where sellers have cut the asking price at least once was up 17.6 percent. This double-digit growth in discounted homes may be another indicator of a sluggish market.
“In more than half of the surveyed markets, sellers are averaging at least two reductions in price,” said John Oldham, Director of Marketing for ZipRealty. “Inventory has grown throughout much of the year; as sellers face the pressure of more buying options, they seem to be discounting to attract buyers resulting in list prices being cut for over 46 percent of the homes.”
From a month-to-month view, January saw fewer discounted homes for sale than December, with the number of price-reduced homes on the market dropping 4.1 percent and total inventory down 2.1 percent. Although price-reduced inventory outstripped last year’s levels, the percentage slipped from 47.2 percent to 46.2 percent, making it the second straight monthly decline.
The report also found almost no change in the median list price from last month, dropping less than $500 (.2 percent), compared to about a $9,000 decline (3.9 percent) from November to December. While there are still markets where the median list price dropped significantly, such as Orange County, Calif., which saw a $5,000 drop in list price, some markets saw prices nudging back up, such as Miami, Fla., where the list price increased from $180,000 to $185,000 in January.
Highlights of ZipRealty’s January index include:
The number of price-reduced homes on the market is up 19.8 percent of January of 2010
Price-reduced homes fell faster than inventory, with the number of price-reduced homes falling 4.1 percent compared to a 2.1 percent decrease in overall inventory in January as compared to December
The median reduction amount dropped 1.7 percent to $19,088
The median list price dropped by .2 percent from December to $225,015, and the average percentage of price reduction amount to list price fell to 7.8 percent in January
In four major markets, more than half of homes on the market in January included at least one price reduction, down from nine markets in December. Those markets are Phoenix, Jacksonville, Orlando and Baltimore.
Homes listed for sale in Florida continue to be discounted by the largest percentage of original list price nationwide with Orlando leading (12.5 percent), followed by Jacksonville (12.1 percent) and Miami/Ft. Lauderdale/Palm Beach (11.9 percent)
Markets with the largest median price reduction in absolute dollars were:
ZipRealty compiled real estate listing and price reduction data from the MLS in 26 of the 35 major U.S. metropolitan areas where the real estate brokerage operates. The data cited within this report was pulled on February 1, 2011.
This report is intended to convey information on the general market conditions where ZipRealty operates, not on ZipRealty’s operating results. ZipRealty’s operating results may be materially different from the general trends shown in this report. Please do not draw any conclusions about ZipRealty's operating results based on the information contained in this report but, instead, refer to ZipRealty's earnings releases and periodic reports as they are made public.
About ZipRealty, Inc.
ZipRealty is a leading full-service residential real estate brokerage that uses an innovative combination of a comprehensive online presence, robust proprietary technology and knowledgeable local agents to offer its clients fast, responsive and transparent service. The Company’s award-winning, user-friendly website gives its users access to comprehensive local Multiple Listing Services home listings data, as well as other relevant market and neighborhood information and tools. The Company's proprietary technology, including its agent platform and customer relationship tools, helps it to enhance customer service while increasing agent efficiency and reducing costs, allowing the Company to pass on significant savings to consumers as permitted by law. Founded in 1999, the company operates in 23 major markets in 20 states and the District of Columbia. For more information on ZipRealty, visit http://www.ziprealty.com or call 1-800-CALL-ZIP.
Price-Reduced Inventory Up 23 Percent In December Over 2009 With An Average of 2.15 Reductions Per Listing
EMERYVILLE, Calif. (Jan. 13, 2011) –The number of price-reduced homes on the market this December remained at high levels compared to 2009, rising 23.4 percent according to a report surveying 26 US markets issued by national real estate brokerage, ZipRealty (www.ziprealty.com; NASDAQ: ZIPR).
The report also found that in the markets surveyed, the median list price in December was down 3.9 percent at $225,434, compared to November when the median list price was over $9,000 more at $234,484. California markets showed the largest month-to-month markdown, with the median list price in San Francisco dropping $35,195, followed by San Diego (median list price dropped $19,100) and Orange County ($17,100) as sellers slashed prices.
According to the report, both price-reduced inventory and total inventory decreased in November compared to October, but this December’s month-over-month decline was far more dramatic, with total inventory diving 5.3 percent and price-reduced inventory falling 7.7 percent. Both figures are still large increases over last year, with total inventory up 11.2 percent over December 2009 and reduced inventory up 23.4 percent.
“We continue to see high inventory levels and declining prices,” said John Oldham, Director of Marketing for ZipRealty. “Year-end inventory is declining but is still much higher than 2009 levels.”
The percentage of inventory that has experienced at least one reduction dropped for the first time in months, decreasing to 47.2 percent in December, compared to 48.4 percent in November and 48.3 percent in October of 2010.
“December is traditionally a slow month for home sales, and this could be a contributing factor to the decline over the previous two months in inventory as well as the drop in median list price,” Oldham added.
Highlights of ZipRealty’s December index include:
The number of price-reduced homes on the market is up 23.4 percent over December of 2009
Price-reduced homes fell faster than total inventory, with the number of price-reduced homes plunging 7.7 percent compared to a 5.2 percent decrease in overall inventory in December as compared to November
The median list price dropped by 3.9 percent from November to $225,434, and the average percentage of price reduction amount to list price rose to 7.9 percent in December
In 9 markets, more than half of homes for sale in December included at least one price reduction, down from 11 markets in November. Those markets are Phoenix, Jacksonville, Minneapolis/St. Paul, Tucson, Orlando, Chicago, Seattle, Baltimore, and Orange County
Homes listed for sale in Florida markets were discounted by the largest percentage of original list price nationwide with Orlando leading (12.4 percent), followed by Miami/Ft. Lauderdale/Palm Beach (12.2 percent) and Jacksonville (12 percent)
Markets with the largest median price reduction in absolute dollars were:
Market
Median Price Reduction
San Francisco
$34,000
Orange County, Calif.
$34,000
San Diego
$30,000
Miami/Ft. Lauderdale/Palm Beach
$25,000
Seattle
$25,000
About the Report
ZipRealty compiled real estate listing and price reduction data from the MLS in 26 of the 35 major U.S. metropolitan areas where the real estate brokerage operates. The data cited within this report was pulled on January 1, 2011. To download the data from the report go to: [ziprealty.typepad.com]
This report is intended to convey information on the general market conditions where ZipRealty operates, not on ZipRealty’s operating results. ZipRealty’s operating results may be materially different from the general trends shown in this report. Please do not draw any conclusions about ZipRealty's operating results based on the information contained in this report but, instead, refer to ZipRealty's earnings releases and periodic reports as they are made public.
About ZipRealty, Inc.
ZipRealty is a leading full-service residential real estate brokerage that uses an innovative combination of a comprehensive online presence, robust proprietary technology and knowledgeable local agents to offer its clients fast, responsive and transparent service. The Company’s award-winning, user-friendly website gives its users access to comprehensive local Multiple Listing Services home listings data, as well as other relevant market and neighborhood information and tools. The Company's proprietary technology, including its agent platform and customer relationship tools, helps it to enhance customer service while increasing agent efficiency and reducing costs, allowing the Company to pass on significant savings to consumers as permitted by law. Founded in 1999, the company operates in 35 major markets in 22 states and the District of Columbia. For more information on ZipRealty, visit www.ziprealty.com or call 1-800-CALL-ZIP.
Stamen Design put together some graphical real estate maps, which were heavily influenced by Cheerios (yes, the cereal). Using ZipRealty data, Stamen makes it easy to see which areas are more expensive based on the sizes of the colored circles. Read about the project.
Is Black Friday a scam, a golden opportunity to get awesome stuff for peanuts, or just another reason for Gene and Jay to talk about mindfulness? Could be all three.
Listen to the episode, let us know what you think, and enjoy your Thanksgiving!
Jay S. Fleischman and Eugene Melchionne discuss on this episode of Debt Podcast the turmoil surrounding LegalHelpers, also known as Macey & Aleman, regarding alleged problems with bankruptcy petitions filed by this law firm.
Slow Summer Selling Season led to 2.1 Percent Increase in Price-Reduced Listings from August to September
EMERYVILLE, Calif. (Oct. 06, 2010) – The number of price-reduced homes on the market this September increased dramatically compared to the same time last year, rising 24.2 percent according to a report issued by national real estate brokerage ZipRealty (www.ziprealty.com; NASDAQ: ZIPR).
According to the Price Reduction Index, ZipRealty’s monthly review of MLS-listed properties in 26 markets surveyed by the brokerage, list prices were cut at least once for 47.8 percent of homes on the market in September, an increase of nearly 10 percent over last year.
September also saw more discounted homes for sale than August, with the number of price-reduced homes on the market up 2.1 according to the report. The report also found that sellers had reduced their list prices an average of twice with a median reduction of $19,165.
“Sellers appear to be cutting their prices again,” said Leslie Tyler, Vice President of Marketing for ZipRealty. “Last spring the tax credit helped to bring buyers into the market, and we didn’t see sellers reducing prices by as much. But now sellers seem to be cutting prices more aggressively going into the typically slower fall and winter seasons.”
Highlights of ZipRealty’s September index include:
Nearly half (47.8 percent) of listed homes in September included at least one price reduction – an increase of 1.5 percent compared to August
The number of price-reduced homes rose quicker than inventory, with the number of price-reduced homes rising 2.1 percent compared to a .6 percent increase in overall inventory in September as compared to August
The median list price dropped by 1.75 percent from August to $245,265, and the average percentage of price reduction amount to list price rose to 7.25 percent in September
In 10 major markets, more than half of homes on the market in September included at least one price reduction, up from seven markets in August. Those markets are Jacksonville, Phoenix, Minneapolis/St. Paul, Orlando, Chicago, Tucson, Baltimore, Austin, Orange County and Seattle
Jacksonville, Fla., continues to have the highest percentage of price-reduced homes out of the 26 markets surveyed. More than 55 percent of Jacksonville listings in September included at least one price reduction
Denver had the lowest percentage of price-reduced homes in September, with 34.4 percent of listings including at least one reduction
Homes listed for sale in Miami/Ft. Lauderdale/Palm Beach were discounted by the largest percentage of original list price nationwide (23 percent), followed by Orlando (11.7 percent) and Jacksonville (11.8 percent)
Markets with the largest median price reduction in absolute dollars were:
Market
Median Price Reduction
San Francisco
$35,000
Orange County, Calif.
$35,000
San Diego
$30,000
Miami/Ft. Lauderdale/Palm Beach
$26,000
Washington, D.C.
$25,000
About the Report
ZipRealty compiled real estate listing and price reduction data from the MLS in 26 of the 35 major U.S. metropolitan areas where the real estate brokerage operates. The data cited within this report was pulled on October 1, 2010.
This report is intended to convey information on the general market conditions where ZipRealty operates, not on ZipRealty’s operating results. ZipRealty’s operating results may be materially different from the general trends shown in this report. Please do not draw any conclusions about ZipRealty's operating results based on the information contained in this report but, instead, refer to ZipRealty's earnings releases and periodic reports as they are made public.
About ZipRealty, Inc.
ZipRealty is a leading full-service residential real estate brokerage that uses an innovative combination of a comprehensive online presence, robust proprietary technology and knowledgeable local agents to offer its clients fast, responsive and transparent service. The Company’s award-winning, user-friendly website gives its users access to comprehensive local Multiple Listing Services home listings data, as well as other relevant market and neighborhood information and tools. The Company's proprietary technology, including its agent platform and customer relationship tools, helps it to enhance customer service while increasing agent efficiency and reducing costs, allowing the Company to pass on significant savings to consumers as permitted by law. Founded in 1999, the company operates in 35 major markets in 22 states and the District of Columbia. For more information on ZipRealty, visit www.ziprealty.com or call 1-800-CALL-ZIP.
NEW YORK (Dow Jones)--Housing inventory, which typically dips as the summer ends, rose for the ninth straight month in September, indicating that sales remain weak as the downturn drags on.
Listings for single-family homes, condos, townhomes and other residences in 26 major metro markets spiked 13.5% from a year earlier, reports ZipRealty Inc., a real-estate brokerage firm based in Emeryville, Calif. When compared with a month earlier, September's inventory rose 0.6%, according to data pulled from local multiple-listing services on Friday.
In addition to sluggish sales, the increase comes from lenders dumping foreclosed homes on the market, short sale offers and sellers who can no longer wait, says Leslie Tyler, ZipRealty's vice president of marketing. To continue reading please visit the Wall Street Journal
Retailers aren’t the only ones slashing prices this fall to attract shoppers. National real estate brokerage ZipRealty’s inaugural Sale Rack Report finds that many home sellers are aggressively reducing their asking prices, some by more than two thirds of the original list prices and tens of thousands of dollars in markets nationwide. This video from KOMO News focuses on the local Seattle market.
Jay Fleischman and Gene Melchionne talk insurance. Great idea or great scam? You’ll find out just how much a whole life insurance policy was worth when Gene graduated from law school, and the marketing angle Jay’s got for the folks at Gerber Life Insurance.
Jay Fleischman Gene Melchionne return to the table to continue the chat about bad debt. We talk about coupons, using debit cards, Guitar Center, and why Gene is going to be an old man in a bathrobe shouting, “Where’s my money?”
Good fun, good information – list in and let us know your thoughts.
Gene Melchionne and Jay Fleischman sit down to begin a discussion of good debt vs. bad debt. From there, the conversation dovetails into a chat about our educational system and the role of college in our society.
It’s all a fun ride, and a terrific jumping-off point for our deconstruction of the notion of the place of debt in our world.
Listen in and please put your comments below – we’re looking forward to keeping this conversation going.
Here's a question for all the commercial real estate agents, brokers and developers out there. Why do commercial real estate developers always put these bumpy landscape tiles right by grocery store entrances and exits? There must be a good reason because all the major grocery stores have these. But they're such a pain because stuff starts falling off your cart as soon as the wheels hit these things. If you try to go over them slowly, the cart's wheels get stuck. If you try to go over them quickly, your cart bounces around and stuff falls off.
This may sound sexist but I'm saying it anyway... the bumpy landscape tile idea came from some guy who's never had to push a cart overflowing with groceries through the parking lot! Just sayin'. :)
Jay Fleischman re-introduces the Debt Podcast after a hiatus lasting more than 4 full years. Like The Who said, “meet the new boss – same as the old boss.”
Subscribe to the show in iTunes, on your favorite RSS reed reader or just come back and visit often!
The Texas Department of Housing and Community Affairs has released two important resources—the 2010 State Low Income Housing Plan & Annual Report and the 2010 Program Guide.
The housing plan serves as an overview of statewide housing needs and reports on the distribution of the agency's resources.
The program guide briefly describes all of the department's programs as well as many others at the state and federal levels.
San Francisco Mayor Gavin Newsom had a good line about affordable housing today. "Shelters solve sleep, housing solves homelessness," he said at the opening of 149 Mason Street, a 56-unit project for formerly homeless individuals.
I'm not sure if Newsom is the first to deliver that line, but he said it with conviction.
149 Mason is located on the edge of San Francisco's Tenderloin neighborhood, right near Union Square.
Developed by Glide Economic Development Corp. and Tenderloin Neighborhood Development Corp., the project will be loaded with supportive services. Glide Health Services will launch its first satellite clinic to provide onsite medical services for residents.
The Philadelphia Housing Authority (PHA) reports that it received an overwhelming 54,000 applications for its Housing Choice Voucher Program during a recent two-week period.
Using an online application system for the first time, the housing authority received 33,000 applications, or 61 percent, through the Web. Another 21,000 applications came via telephone. PHA recruited employees from all of its departments to work shifts taking calls.
The demand shows that even more families, seniors and disabled citizens need help paying their rent than initially thought, according to Executive Director Carl Greene.
PHA estimates that each year about 2,500 voucher holders leave the program, creating opportunities for those on a waiting list.
With 17,000 households, the voucher is PHA's largest program.
Sen. Jeff Bingaman (D-N.M.) introduced legislation today aimed at boosting the low-income housing tax credit (LIHTC) market.
His bill, the Low-Income Housing Tax Credit Recovery Act, introduces new flexibility into the program by allowing credits to be carried back up to five years for new housing and qualifying existing housing.
Affordable housing advocates have been pushing for this change as a way to make the credits more attractive to investors. An Ernst & Young study recently determined that this would bring in another $5 billion in private LIHTC investments.
The introduction of the bill was applauded by Enterprise and the Local Initiatives Support Corp.
"Congress’s support and passage of a carryback extension is urgently needed for developers to attract and retain the necessary investment capital to finance, build and rehabilitate affordable apartments,” Charles R. Werhane, president and CEO of Enterprise Community Investment, Inc. “Affordable housing is the cornerstone of success for people and families with low incomes across the country and so Enterprise urges Congress to quickly pass this critical legislation.”
The carryback extension is one of three consensus LIHTC proposals supported by more than 170 national, state and local LIHTC stakeholder organizations working together as part of the Affordable Rental Housing A.C.T.I.O.N. (A Call To Invest in Our Neighborhoods) campaign. For more information on the campaign, visit www.rentalhousingaction.org.
Low-income housing tax credit (LIHTC) allocating agencies continue to promote the development of permanent supportive housing through the federal tax credit program.
Thirty-two jurisdiction implemented notable new policies or revised policies that encourage supportive housing development during the past two years, according to a new report by the Corporation for Supportive Housing (CSH).
Forty-six LIHTC allocating agencies provide potential scoring advantages for supportive housing, and 41 agencies provide general scoring incentives encouraging permanent supportive housing or special-needs housing, says CSH.
Fifteen agencies promote supportive housing with set-asides of credit authority. Three agencies have a threshold requirement of dedicating 5 percent to 10 percent of a development's units for permanent supportive housing, and four additional agencies have general threshold requirements that promote permanent supportive housing, says CSH.
The study looks at each state's qualified allocation plan, which is used to allocate the tax credits to affordable housing developers.
The Department of Housing and Urban Development (HUD)just launched a Web site to allow people to comment on the design of a new national study that will look at housing discrimination based sexual orientation and gender identity.
While there have been no national assessments of housing discrimination targeting the lesbian, gay, bisexual and transgender community, there is a body of evidence suggesting this sort of bias exists, says federal housing officials.
To learn more and to share comments on how HUD might test for discrimination, visit [portal.hud.gov].
Here's a scorecard of some of the recent lineup changes at state housing finance agencies across the country.
The reasons for the leadership changes vary from retirement to resignations to moves made by governors.
Cris A. White (pictured) has become executive director and CEO of the Colorado Housing and Finance Authority. White has been with the agency for more than 20 years, most recently serving as the interim executive director and COO.
His appointment was announced today after a nationwide search.
White takes over the top post from Roy Alexander, who retired at the end of the last year.
In Iowa, Joe O'Hern was appointed director of the Iowa Finance Authority (IFA) by Gov. Chet Culver at the end of last year. This moves comes after Culver plucked Bret Mills from IFA to led the Iowa Department of Economic Development. O'Hern was interim director at the economic development agency and was deputy director at IFA before that.
And, in case you missed it, Gloria Materre took over as executive director of the Illinois Housing Development Authority last fall. She's the former deputy chief of staff under Gov. Pat Quinn. Materre succeeds DeShana Forney, who resigned "to pursue other career opportunities," according to the authority.
There will also be changes at the Missouri Housing Development Commission (MHDC), where Pete Ramsel recently resigned as executive director. "I am surprised by the sudden resignation of Pete Ramsel from MHDC," said Lt. Gov. Peter Kinder in a Feb. 3 statement. "Pete has been a consummate professional during his tenure at the commission. Over the past 15 years, Pete has worked tirelessly with commissioners and public and private entities to help strengthen our state by providing affordable housing for low-income Missourians." Last year, state Auditor Susan Montee issued a critical report of MHDC. The audit criticized the agency's procurement policies and procedures.
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More Condos May Be on the Rise in San Francisco's Financical District
Developers went in front of the Planning Commission Thursday to propose a 248-unit condo building located at 555 Washington St. The building would rise 430 feet next to the Transamerica Pyramid, in the heart of the financial district.
The Planning Commission came up one vote shy of derailing the condominium and failed to certify the environmental impact report, which is needed for the project to proceed.
Opponents claim that the development will require exemptions from several land uses that regulate everything from shadows and height to wind and parking which ultimately create a bad precedent.
But those in favor of the project say it would to a number of different things such as, provide much need housing, instill a new spark into the area, be built with an eco-friendly approaching, create jobs, and provide more open space.
The consideration of the development has now been delayed until March 18, when both the Planning Commission and the Recreation and Park Commission can attend the hearing jointly.
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In these metro areas, now is a good time to make the jump to homeownership.
The U.S. government has pushed hard to make homeowners out of one-third of Americans who still rent their homes. It introduced and later extended a tax credit for first-time home buyers, and has kept federal interest rates at their lowest levels since the 1940s.
Market conditions are such that now is a particularly good time for some renters to take the hint.
In Portland, San Francisco, Minneapolis, and Washington, D.C., the premium to buy--the spread between what you'd spend on renting and what you'd pay each month for a mortgage--is far narrower now than its 15-year average. And economists predict a significant home-price hike in five years. So upgrading will cost much less than usual, and home buyers are likely to get a good return on their investment.
Note that buying isn't necessarily cheaper than renting in these metro areas. In fact, it often remains a more expensive proposition. But for those determined to own, that investment is a better one now than it normally is.
Take San Francisco. To live here has always required a hefty bump in monthly costs from renting; it's normally an incredible 296% more expensive to buy than lease a home, and the city's residents know this. That's why 42% of them stick to renting. Even though in the third quarter of 2009 the premium was still in the triple digits--233%--it had shrunk by 63 percentage points from the above 15-year average. As with the other cities we've highlighted, you're not getting nearly as good a deal by renting as you might have just a few years ago.
"Rents are falling, but not nearly as rapidly as home prices," says Ron Witten, founder of Dallas-based Witten Advisors, an apartment market consulting firm. "Part of the reason is a shift away from home ownership toward renting," he says, in part because mortgages have become harder for many to obtain.
Behind the Numbers
To find cities where it's a good time to go from renting to buying, we used data from Witten Advisors, which calculated the premium to buy for 42 Metropolitan Statistical Areas across the country using data from the U.S. Census, the National Association of Realtors and a blended average of fixed- and adjustable-rate mortgages from the Federal Housing Finance Agency (which oversees and regulates lenders). We compared the premium in the third quarter of 2009 with the average premium over the last 15 years to find the biggest drops.
We also wanted to pinpoint markets where home buying is a smart investment, so we factored in the five-year forecast in the S&P/Case-Shiller Home Price Index from Moody's ( MCO - news - people )Economy.com. The cities on our list have some of the biggest discounts on the premium to buy coupled with big projected increases in home prices over the next five years.
One major market we didn't look at is New York City, another spot where rents have softened less than home prices. Witten Advisors doesn't track the metro area because accurate historical data on rental costs there is exceedingly difficult to obtain.
Quality of Life, at a Discount
Portland, Ore., makes our list for much the same reason that San Francisco does: It's a picturesque, culture-driven city with good local services and amenities. The city is still not particularly cheap for buyers--but it's cheaper than normal.
A family hoping to put down roots there would normally pay a 62% premium to go from renting to buying. In the third quarter of 2009, however, that premium shrank by 16 percentage points. At the same time, Moody's Economy.com anticipates that home prices will jump 19% over the next five years. That's partly because, like San Francisco, Portland has strict government limitations on building and a coastal location that keep sprawl in check.
"Portland has one of the most controlled environments in the country in terms of development rights," says Stuart Gabriel, director of the Ziman Center for Real Estate at the UCLA Anderson School of Management. "Those supply constraints will push prices up."
Jobs Stability
The presence of jobs--along with strong industries that will keep generating new ones--is a big factor in keeping demand for homes, and therefore home prices, high. The weak national economy has helped reduce the premium to buy for the time being, but where the labor market is relatively healthy, home prices are predicted to shoot up.
In Minneapolis, for example, where large companies including Target and General Mills have their corporate headquarters (and there's a large university system), home buyers will only pay 14% more than if they were renting (24 percentage points lower than average), and home prices should climb by 15% in five years.
Similarly, in Washington, D.C., government jobs are plentiful, and anticipated to stay that way. The 6.1% unemployment rate here is well below the national average, which is partly why Moody's anticipates a five-year jump in home prices of 15%. And, at the moment, the premium to buy is 20 percentage points lower than its usual 57%.
Of course, whether buying or renting is best is ultimately an individual choice, and one driven by a lot more than map coordinates. When subprime lending was rampant, many without the means to buy were encouraged to do so anyway--and it's no secret how that turned out.
"If there's anything we should have learned from this housing cycle, it's that the decision to buy or rent ought to be a personal lifestyle decision," says Witten. "In part, it's a question about, 'Do I want to be a homeowner' in general, and specifically, 'Do I want to be a homeowner now, with this economic uncertainty?'"
Department of Housing and Urban Development (HUD) Secretary Shaun Donovan
said a statement on the government-sponsored enterprises (GSEs) is coming
soon.
This comment was made today during a media briefing on HUD’s proposed 2011 budget.
A reporter inquired why little was said in the spending plan about
Fannie Mae and Freddie Mac.
HUD made a commitment last summer as part of its proposal on financial
regulatory reform that it would put forward a statement on the GSEs around
the time of the budget.
“We did not say that it would be included in the budget document itself,”
Donovan said. “We continue to be on track to release a statement in the near future on the GSEs.”
Nothing should be read into the fact there isn’t a fuller statement in the
budget document, according to Donovan.
Residents living in San Francisco’s single-room occupancy (SRO) buildings can call the city’s 311 line to report building and health problems.
Local residents have typically used the 311 customer service center to report potholes, graffiti, and other outdoor issues. Housing advocates and city workers recently teamed to expand the call center to assist SRO residents, who can use the number to report building safety and health issues.
“Issues like rodents, inadequate heat or water, and block fire exits are a reality for low-income residents,” said Josh Vining, a community organizer for the Mission SRO Collaborative, the advocacy group that led the community effort. “311 now gives people a way to report unhealthy or unsafe conditions and to follow-up on the solution.”
As far as he knows, no other city provides a similar service for SRO residents. Vining says there are about 530 SRO buildings in San Francisco, housing an estimated 18,000 residents.
The call center will minimize duplicative requests to agencies and direct complaints to the appropriate department.
Mayor Gavin Newsom formed the center in 2007, and it’s been a touchy topic with some members of the Board of Supervisors, who want to cut it to save money.
An official with Tualatin Valley Housing Partners (TVHP) tells us that the 15-year-old nonprofit group is edging closer to shutting down by selling its affordable housing properties.
Potential buyers are busy performing due diligence as they consider taking over the Beaverton, Ore. group's portfolio of about seven properties. It doesn't look like there will be one buyer to take over all the communities. Instead, several groups will acquire individual developments.
The dispositions could take place in the next 60 days or so, according to Larry Iverson, board president.
TVHP is among the businesses that have been hit hard by the recession.
Grants and development fees dried up, some residents lost their jobs and could not pay their rents, and the financial markets were a mess. In addition, a former employee looks to have taken a modest amount of funds. The impropriety involved less than $10,000 and did not play a big role in TVHP’s closing, according to group.
We wonder how many other housing firms are at the tipping point.
The California Tax Credit Allocation Committee has released its proposed program schedule and deadlines for 2010.
Under the plan, applications for the first round of funding for low-income housing tax credits will be March 25. Look for application workshops throughout February.
David Byrne, former frontman of the Talking Heads, has joined the lineup for the Congress for the New Urbanism (CNU) meeting in May.
He’s taking part on an opening panel at the “Rx for Healthy Places” conference in Atlanta. The rock star may sound like an unusual choice, but Byrne is a thoughtful commentator on urban life.
Byrne's book Bicycle Diaries chronicles how his use of bicycles as his primary form of transportation (and folding bicycles wherever he travels) taught him to view the world and its cities differently. His also wrote an essay for the Wall Street Journal this fall that described his perfect city.
"Riding his bicycles through the cities of the world, David Byrne is out front among the voices from diverse worlds — the arts, economics, music, public health — who are seeing connections between how we build neighborhoods, how we get around and how well we live," said John Norquist, CNU president and CEO, in a statement. "Whether its songs such as 'Once in a Lifetime' or other forms of art and writing, he's been a shrewd observer of modern life so it's a real joy to see him turn his eye to the built environment and the communities it supports."
Nearly 60 grantees were awarded $2 billion under the Neighborhood Stabilization Program (NSP) funds, announced the Department of Housing and Urban Development today.
Florida communities and organizations received the largest amount, nearly $349 million. California received more than $318 million, with the city of Los Angeles receiving $100 million. Michigan was next with nearly $224 million going to the Michigan State Housing Development Authority, which is working with 12 communities—Battle Creek, Benton Harbor, Detroit, Flint, Grand Rapids, Hamtramck, Highland Park, Kalamazoo, Lansing, Pontiac, Saginaw, and Wyandotte.
This round of grants is being awarded competitively to applicants with the most innovative ideas to rebuild local communities while demonstrating they have the capacity to deliver on their plans.
The grants will help build on the work being done by state and local governments and nonprofit developers to acquire land, demolish or rehabilitate abandoned properties, and/or to offer downpayment and closing cost assistance to low- and middle-income homebuyers. Grantees can also create land banks to assemble, temporary manage, and dispose of foreclosed homes.
Funded under the American Recovery and Reinvestment Act, the NSP was created to help redevelop communities hit by foreclosures and vacant homes.
Last year, federal housing officials awarded nerly $4 billion in NSP formula funds to more than 300 grantees nationwide to help communities respond to the housing crisis.
Another $50 million was awarded in technical assistance grants.
The next time you're on iTunes, check out the new By The People: For The People soundtrack, which features Bruce Springsteen, the Dixie Chicks, Sheryl Crow, Dave Matthews, Tim McGraw, Dashboard Confessional, John Mayer, and other artists. The proceeds benefit the United Way and Enterprise's efforts to rebuild the Gulf Coast.
Exclusively on iTunes, the soundtrack was inspired by the HBO documentary By The People: The Election of Barack Obama. The film was produced by actor Edward Norton, an Enterprise trustee.
“In many ways, By the People is a portrait of the people in Obama's campaign who believed that their individual effort could help make history," Norton said. "So, it's fitting that all the proceeds from the soundtrack support Enterprise and United Way's efforts to engage volunteers who also think that they can make a difference, restoring hope and rebuilding lives in the Gulf Coast.”
Deborah VanAmerongen, commissioner of the New York State Division of Housing and Community Renewal, is resigning effective Jan. 15, 2010, according to a statement from Governor David Paterson.
VanAmerongen, who has held the agency's top post since 2007, is expected to join the Nixon Peabody law firm as an adviser. Nixon Peabody has an active affordable housing practice.
Paterson praised VanAmerongen for her work in New York, including helping to author legislation and provide tens of thousands of units of affordable housing. "Perhaps her greatest achievement is helping to negotiate the recently completed refinancing of Starrett City, which will keep nearly 6,000 households affordable for an additional 30 years," he said.
VanAmerongen is the second state housing official to resign in recent weeks. Priscilla Almodovar, president and CEO of the New York State Housing Finance Agency and the State of New York Mortgage Agency, resigned in early December.
VanAmerongen is a member of Affordable Housing Finance's Editorial Advisory Board.
Affordable housing developers Brian Potashnik and his wife, Cheryl, are scheduled to be sentenced in March for their roles in a prominent Dallas bribery case, according to the Dallas News.
The Potashniks had operated Southwest Housing, a large and well-known affordable housing development firm, in the city.
Brian Potashnik pleaded guilty to bribing former Mayor Pro Tem Don Hill, according to the newspaper. He testified earlier this year that he felt pressure from Hill to pay bribes to ensure that his housing projects would be approved. In October, a federal jury convicted Hill and others involved in what became known as the "Dallas City Hall Corruption Case."
Cheryl Potashnik pleaded guilty to bribing state Rep. Terri Hodge, according to the paper. Hodge, who is seeking re-election, faces trial next year.
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This chart illustrates the difference between an investment made on January 1, 2000 in one of the major U.S. stock indices and one made in either a San Francisco house or condominium. It's simply a sample analysis to show how real estate usually appreciates over the longer term: numbers may change dramatically according to the period used in the calculation.
Since it is based upon an all-cash purchase, if one made the calculation based upon a 20% or 25% down-payment, the return on investment on real estate purchased would soar into the hundreds of percent.
Even in periods when the stock markets generate a good return on investment, one should note that significant capital gains taxes apply to stocks, but primary residences occupied for a minimum period of time, are exempt from capital gains taxes for the first $250,000 - $500,000 of gain depending on whether the purchaser was one or two persons.
San Francisco real estate has usually proven to be an excellent investment over the longer term due to the advantages of leverage, the incredible tax benefits of home-ownership in the United States, and local demographic and appreciation trends.
We'll have to wait until 2017 to see how the stock markets fared vs those who purchased homes during the 2007 peaks in real estate prices...
The California Tax Credit Allocation Committee has released its proposed regulation changes for 2010.
The committee has also scheduled three public meetings to solicit comments on the possible changes. The meetings will be held Dec. 4 in Los Angeles, Dec. 7 in Sacramento, and Dec. 9 in San Francisco.
The proposed changes include increasing housing goal percentages for special-needs and single-room occupancy housing types up to 15 percent each, clarifying the geographic apportionment naming styles, and starting in the second round of 2010, limiting a sponsor’s 9 percent applications to no more than four per round and no more than two per set-aside or geographic apportionment.
Officials also propose to amend the final tiebreaker to combine the ratios of (a) requested unadjusted eligible basis to total development costs, and (b) committed permanent public funding to total development costs. Officials note that they would eliminate the exceptions of land costs and developer fee in the total development cost figure.
In two other moves, minimum debt-service coverage ratio is proposed to increase to 1.15x, and an additional manager’s unit is proposed to be required for every additional 80 units in a property.
The Treasury Department and the Internal Revenue Service announced the release of the 2009-2010 Priority Guidance plan.
The plan contains 315 projects to be completed by the IRS over a 12-month period, from July 2009 through June 2010. This year’s plan will address a variety of issues, including recent legislation, the current economic environment, and important international issues, according to officials.
Some of the priorities involve the low-income housing tax credit (LIHTC) program and include:
*Final regulations under Sec. 42 on the requirements for a qualified contract.
*Guidance for the low-income housing credit under Sec. 42 relating to sections 1404 (Tax Credit Assistance Program) and 1602(Tax Credit Exchange Program) of the American Recovery Reinvestment Tax Act of 2009.
*Regulations concerning utility allowances under Sec. 42(g)(2)(B)(ii) for sub-metered buildings. Interim guidance was issued in Notice 2009-44.
I suspect many a real estate mogul got their start playing the board game classic Monopoly. It has a new look this year. This time rather than just houses and hotels, players can also build industrial buildings, railroads and sports stadiums, many in 3D versions in the center of the board.
This being a game, players can also put up bonus buildings that protect their properties or “hazard buildings” that lower the value of opponent’s properties. Not sure what the real world equivalent of those would be, maybe a night club.
Parker Brothers launched Monopoly during the Great Depression and it was a huge hit in those tough times. This year though, going bankrupt and losing property seems a little too close to home.
Los Angeles Mayor Antonio Villaraigosa has announced Doug Guthrie as his pick to become the general manager of the city's Housing Department.
Guthrie has extensive experience in affordable housing, most recently serving as president of Kimball Hill Urban Centers in Chicago, where he built mixed-income and mixed-use projects in challenged urban communities.
Kimball Hill Urban was a subsidiary of Kimball Hill Homes, which filed for bankruptcy and shut down in 2008 amid the housing and financial crisis.
Guthrie was also the inaugural president of the National Equity Fund in 1989 and was also deputy executive director and COO at the Chicago Housing Authority from 1987 to 1989. He has also held several positions with the Department of Housing and Urban Development (HUD).
L.A.'s former housing general manager, Mercedes Marquez, left earlier this year to become HUD's assistant secretary for community planning and development.
Environmentally-friendly construction practices have gotten a lot of hype over the past few years but do they really pay off as an investment? A new study found that tenants in green buildings experience increased productivity and fewer sick days. The research also found that that green buildings have lower vacancy rates and higher rents than non-green counterparts.
The study, conducted by the University of San Diego and commercial real estate broker CB Richard Ellis Group, found that tenants in green buildings such as the Behnisch Architekten-designed Unilever offices in Hamburg above are more productive based on two measures: the average number of tenant sick days and a productivity change. Respondents reported an average of 2.88 fewer sick days in their current green office versus their previous non-green office. About 55% of respondents indicated that employee productivity had improved.
Based on the average tenant salary, an office space of 250 square feet per worker and 250 workdays a year, the decrease in sick days translated into a net impact of nearly $5.00 per square foot per year. The increase in productivity translated into a net impact of about $20 per square foot. The study also showed that green buildings have 3.5% lower vacancy rates and 13% higher rental rates than the market.
The work was based on surveys of 154 buildings under CBRE's management, totaling more than 51.6 million square feet and housing 3,000 tenants in ten markets across the U.S. The study defined a green building as those with LEED certification at any level or those that bear the EPA ENERGY STAR ® label.
Another report out in the past week concluded that constructing new green buildings or retrofitting existing structures with energy efficient air conditioning, solar panels and the like will support 7.9 million U.S. jobs and pump $554 billion into the American economy over the next four years. The study, by the U.S. Green Building Council and Booz Allen Hamilton, determined that green construction spending currently supports more than 2 million American jobs and generates more than $100 billion in gross domestic product and wages.
The economic impact of the total green construction market from 2000 to 2008, the study found, was $178 billion. It created or saved 2.4 million jobs and generated $123 billion in wages.
The U.S. Green Building Council certifies LEED buildings and obviously has an interest in the movement, but Rick Fedrizzi, chief exec of the group said something remarkably down to earth in releasing the report: “Our goal is for the phrase ‘green building’ to become obsolete, by making all building and retrofits green – and transforming every job in our industry into a green job.”
He’s back. After seeing his New Jersey casino empire slide into bankruptcy for a third time, real estate baron Donald J. Trump has returned to the table.
As part of a deal cut with bondholders and announced today, Trump will receive a 10% stake in a newly recapitalized company, which owns three casinos in Atlantic City that carry the Trump name.
In exchange Trump and his daughter Ivanka, both former board members, agreed to drop a lawsuit they had against the company. Trump will be free to use his name on other gambling ventures, just not in five neighboring states.
Trump left the board of Trump Entertainment Resorts in February. It is struggling under $1.7 billion in debt. "I have always felt a tremendous responsibility to New Jersey, and especially to Atlantic City," he said after cutting this new deal.
Others parts of Trump’s empire—wobbly though it may be—continue to grow. The Trump Waikiki hotel opened this week in Hawaii and the Council on Tall Buildings and Urban Habitat just recognized his Trump International Hotel and Towers in Chicago as the sixth largest building in the world thanks to a new way of measuring skyscrapers. Previously they were measured starting with the front entrance, but since many buildings have multi-level entrances, the new standard is the lowest pedestrian entrance.
I once told my colleague Dean Foust, who was writing an article about the Hooter’s restaurant chain, that a planned Hooter’s casino in Vegas was a sure thing. “I’d invest in that,” I said. Scantily-clad women, beer, gambling, what could go wrong?
Alas, the latest results for 155 East Tropicana, the entity that owns Hooter’s Las Vegas, shows that in Vegas there are no sure things. The company lost $14.5 million for the first nine months of this year on revenues of $35 million. Among the results, a 20% decline in food and beverage sales. That’s a lot fewer chicken wings.
A Securities and Exchange Commission filing says the company has received a notice of default from its lenders and is actively trying to restructure its $147 million in debt.
The filing says “the company does not believe that cash on hand at September 30, 2009 of $5.6 million and expected cash flows will be adequate to meet the total financial obligations.”
Hooter’s Las Vegas suffered problems fundamental to all bad real estate investments—a second-rate building in a crummy location. Half its 696 rooms were closed in the third quarter due to plumbing issues. And as Union Gaming analyst Bill Lerner notes, road construction in front of the off-the-Strip property discouraged walk-in visitors.
Even football great Dan Marino punted. His restaurant inside Hooter’s will be renamed the Mad Onion in December.
Maybe the frat boy crowd has less money to gamble. Or maybe people don't want to go to an establishment in Vegas that they can visit in their own home town.
In my own defense I don't think Hooter's management did a great job marketing the casino. I once saw ads for it targeting families. Clearly not the right demographic.
San Francisco-based nonprofit Citizens Housing Corp. has turned over management of its properties to two other affordable housing groups. Tenderloin Neighborhood Development Corp. (TNDC), another San Francisco nonprofit, has taken over management of seven properties with about 540 units in the city. The addition of the properties represents a 30 percent increase to TNDC’s management portfolio. It also moves TNDC into neighborhoods it has not been in. The two organizations have partnered on several developments over the years.
Eden Housing, a nonprofit affordable housing developer and owner headquartered in Hayward, Calif., has taken over management of 10 properties with about 900 units. These properties are all outside of San Francisco.
Like other organizations, Citizens Housing has been facing financial challenges this year. It also lost its longtime president, Jim Buckley, who took a teaching position at the Massachusetts Institute of Technology.
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Emerald Fund is hosting a neighborhood conversation, to solicit ideas and commentary for their new park and mixed use development at 333 Harrison Street.
Tuesday December 8th
6-8pm at One Rincon Hill Hospitality Room – 425 1st Street @ Harrison. 333 Harrison [David Baker + Partners] Emerald Fund Projects [Emerald Fund]
The Milken Institute came out with its annual list of cities that are best able to create jobs. The top ten were culled from a list of the nation’s 200 largest cities. All have managed to avoid the worst of the economic meltdown driven by falling housing markets and job losses in manufacturing and global trade.
The 2009 top 10 performers
1. Austin-Round Rock, TX
2. Killeen-Temple-Fort Hood, TX
3. Salt Lake City, UT
4. McAllen-Edinburg-Mission, TX
5. Houston-Sugar Land-Baytown, TX
6. Durham, NC
7. Olympia, WA
8. Huntsville, AL
9. Lafayette, LA
10. Raleigh-Cary, NC
Texas cities dominate the list. The free-marketers at the Milken Institute already love the Lone Star State with its lack of zoning laws and no state income tax. Communities such as Houston, Austin, Killen and not too far Lafayette, Louisiana never saw a big run up in home prices and they have the still strong energy sector supporting their economies.
The Milken folks noted that the biggest decliners on list included multiple cities in Florida and California where housing related jobs continue to disappear. Michigan cities are also among the nation’s weakest performers, with heavy losses in durable goods and automotive manufacturing.
Bloomberg is reporting that condo owners of the still underconstruction Cosmopolitan Resort on the Vegas strip have sued the owner, Deutsche Bank, to get their deposit money back.
The suit illustrates the varying rules for getting down payments back even in projects with major problems. Deutsche Bank foreclosed on the $3.9 billion project. It’s offering buyers in the West Tower 74% of their deposit money back. Nevada law allows developers to keep 15% of a buyer's down payment.
In court filings, condo buyers claim they have suffered through construction delays that now prevent them from closing. Building interiors were modified ten times and problems with drainage require 24 hour pumping of water beneath the building. Buyers claim the delays have eliminated their ability to get loans because real estate prices have collapse so much.
My Mom always said buy a condo when it’s under construction because you’ll get a discount. Of course, those "pre-completion prices" come with a big risk.
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The $8,000 credit was scheduled to expire on Dec. 1 2009 but will now be in effect through the end of June 2010. Homebuyers must sign a contract before April 30 and close by June 30, 2010. The income limits were also raised: Single buyers can now earn up to $125,000 and still get the full credit while a married couple can earn $225,000.
The bill also made more homeowners eligible to claim the credit on their taxes. First-time buyers -- those who have not owned a home in the past three years -- still qualify for an $8,000 rebate, which was previously mostly useless for San Francisco due to the previous income cap of $75,000 (which put most out of the running for a minimum SF purchase). However now people who want to trade up can also qualify. Those who have owned and occupied a residence for at least five years out of the past eight can claim a $6,500 tax credit if they close on a purchase by the end of June.
Trillions spent on propping up banks, buying mortgages, tax credits and new programs designed to lower payments and prevent foreclosures. And yet a new survey from Move Inc., the parent of Realtor.com, says Americans are growing increasingly dissatisfied with how Washington is handling the housing mess.
The October 2009 survey found that the federal government’s approval rating by consumers on housing issues has slipped since March 2009. By a six-percent margin, Americans said they don’t think the government is doing enough to stabilize the housing market (48.2% compared to 42.2% five months ago). According to the survey, consumers still want low interest rates (31.4%) and action by the government to help homeowners prevent foreclosures (28.5%), the same two top priorities expressed by survey respondents in March.
The survey found that public participation in the programs to prevent foreclosures is much lower than anticipated. In March 2009, several days after the details of the Making Home Affordable program were announced; Move’s survey found that 17.6 percent of those interviewed said they intended to participate in the Administration’s program. Now only 8.8 percent said they actually did participate.
The number of consumers interested in investing in real estate has doubled since March. One out of eight (12.1%) homebuyers today plan to purchase a home as an investment property, compared to 5.6 percent seven months ago.
Fear of foreclosure is fading. In March 52.5 percent of all survey respondents said they were concerned that they or someone they know may face foreclosure in the next 6 to 12 months. That number dipped slightly to 45.1 percent in October.
The survey of 1,000 people was conducted the third week of October.
The real estate market continues to send mixed signals. Home sales are rising. They were up 11% in the third quarter from the same period last year to a 5.3 million-a-year annual pace.
The sales are coming thanks to a lot of financial incentives. Thirty year mortgage interest rates remain near record lows at 5.1%. Uncle Sam continues to write $8,000 tax credit checks to first time home buyers. “The buying conditions this year are the most favorable on record dating back to 1970,” says Lawrence Yun, chief economist for the National Association of Realtors.
Nearly one-third of those sales though are foreclosed homes trading at distressed prices. They are dragging down prices nationally. The Realtors association reported today that prices fell in 123 out of 153 cities tracked in the third quarter.
What about the thirty cities where home prices rose? They are places better known for affordability and stability than surging prices.
The largest single-family home price increase in the third quarter was in the Cumberland area of Maryland and West Virginia at $122,100, up 19.2 percent from the third quarter of 2008. Next was the Davenport-Moline-Rock Island area of Iowa and Illinois, where the median price increased 14.3 percent to $115,600, followed by Oklahoma City, at $144,100, up 9.1 percent from a year ago.
The biggest sales gain between the second and third quarters was in North Dakota, up 42.3 percent; followed by Rhode Island which rose 26.5 percent; and Pennsylvania, up 25.6 percent.
It's likely that buyers in rural areas that didn't see a tremendous surge in prices see the low interest rates and tax incentives as a good buying opportunity.
Here's the Realtors' Lawrence Yun's take.
“The wide range of market performance and reversals around the country, ranging from double-digit gains to double-digit losses in both sales and prices, underscores just how local real estate truly is,” Yun said. “The wide changes and mix of numbers also indicates a market in transition, hopefully to one that is becoming more balanced and stable.”
The Realtors' spokesman tells me that the new credit will start tomorrow, not today.
"We rechecked the effective date for the repeat buyer," spokesman Walt Malony said in an e-mail. "The effective date is 'after the date of enactment.'Today is date of enactment, so the fun begins tomorrow, Nov. 7."
Judging from all of your questions, tomorrow is going to be a confusing day for buyers, sellers, and the real estate agents, brokers, and attorneys advising them.
The Zip Codes Are Back! Thank you nice folks at Arizona Regional MLS (ARMLS®)!!
Zip codes disappeared from AZ MLS sheets sometime in the past few weeks. I don't know for sure when the zip codes returned, but I noticed it yesterday, (ironically) right after I finished talking on the phone with another real estate agent who mentioned the missing zip codes! He was giving me an address and didn't have the zip code because it wasn't on his MLS printout! But now I'm happy to say that MLS looks like this again...
Just to be sure, I looked up some of my old MLS printouts that had no zip codes, and MLS shows all their zip codes now. So thank you again ARMLS®!!
Update: Just spoke with somebody at Sen. Chris Dodd's office. According to the senator's banking committee staff, you can qualify for the credit even if you signed a purchase contract before today's date. The important thing is that you close on the home between today and June 30, 2010 (Your contract must be signed by April 30, 2010). Keep the questions coming, I'll try to answer as many as I can.
Dozens of you have written in with good questions about the tax credit. I'm working on finding answers, especially to one recurring question. To qualify for the $6,500 credit is it necessary to sign the purchase contract after the measure is signed into law today or can a homeowner who closes on a home after today also meet the requirements? I've asked the White House to clarify.
In the meantime, I just received a press release from CMPS Institute, a training, examination, certification and ongoing membership program for financial professionals who provide mortgage and real estate equity advice.
It clarifies a few things. Read on.
More Homebuyers Qualify for Tax Credit
Ann Arbor, MI November 6, 2009 – Congress just passed an expanded version of the $8,000 first time home buyer tax credit that was set to expire on November 30. “The new version of the tax credit has the potential to stimulate the housing market even more than the old version due to the fact that more people will qualify under the new rules,” said Gibran Nicholas, Chairman of the CMPS Institute, an organization that certifies mortgage bankers and brokers. “Although the tax credit remains at $8,000 for home buyers that have not owned a primary residence in the last three years, it has been expanded to include a $6,500 tax credit for home buyers that have lived in their current primary residence for at least five consecutive years out of the past eight years. Under the old rules, move-up home buyers did not qualify.” Consider these three examples:
Example 1:
Jane purchased a home in 2002, lived there for 5 years as her primary home, moved out in 2007, and turned that home into a rental property. If Jane decides to buy a new primary residence today, she would qualify for the $6,500 tax credit based on the fact that she lived in the same residence as her primary home for at least five consecutive years out of the past eight.
Example 2:
Harry purchased a home in 2004, and lived there for the past 5 years as his primary home. If Harry decides to buy a new primary residence today, he would qualify for the $6,500 tax credit based on the fact that he lived in the same residence as his primary home for at least five consecutive years out of the past eight.
Example 3:
Nicole purchased a home in 2006, and lived there for the past 3 years as her primary home. If Nicole decides to buy a new primary residence today, she would not qualify for the $6,500 tax credit based on the fact that she did not live in the same residence as her primary home for at least five consecutive years out of the past eight.
The tax credit applies to homes purchased for less than $800,000 before May 1, 2010. “If you sign a binding contract to purchase a home before May 1st, you would need to close on the transaction before July 1, 2010,” Nicholas said. “It works kind of like a gift certificate that can be redeemed for cash. You simply file a form with the IRS right after you buy your home, and the IRS will send you a check for the full amount of your credit.”
The income limitation for single tax payers went up from $75,000 under the old rules to $125,000 under the new rules. For married tax payers, the income limitation went up from $150,000 to $225,000. “This means that more people will qualify for the credit – especially in parts of the country with higher costs of living,” Nicholas said. “This should help stimulate parts of the housing market that may not have been impacted by the old version of the credit.”
There are many creative ways of structuring your home purchase transaction in ways that maximize the benefits of the credit. Here are a few examples:
· The credit applies to 1-4 unit homes as long as you live in one of the units as your primary residence – you could live in one unit and rent out the others
· If two unmarried individuals buy a home, and only one of the individuals qualifies for the credit based on their income or past home ownership status, the individual who qualifies for the credit can claim the full credit. (Note: In the case of married couples, both spouses must qualify for the credit.)
· The credit applies even if you have co-signers on your mortgage loan
Move Inc., parent of Realtor.com, the online listing service for the National Association of Realtors, came out with its third quarter earnings yesterday. Sales were down 11% to $53 million. Although the company has been able to boost its cash flow through cost cutting and more efficient management, it is still a tough environment. Realtor.com depends largely on real estate agents advertising their listings on the site.
Move CEO Steven Berkowitz said the company didn’t see the usual spike in listings last Spring. Many homeowners are holding off putting their house on the market in this crummy sales year. As for the agents, Berkowitz said the company had seen a “significant decrease” in their number. Of those that are in still in business, they are spending less on marketing.
What gives Berkowitz hope is more potential home buyers coming to the site and staying longer, even its just to window shop.
“They are doing more shopping. They are doing more comparison shopping. They are spending more time looking rather than buying. It is no different than a lot of what is happening in retail in a lot of stores where the high end stores people are walking through the store and shopping but they are not buying.”
The company says it’s updating many of its service offerings, which it needs to. Realtor.com is just about the only real estate search site that doesn’t link to Google's street views so you can see what the neighborhood looks like without driving out there. Get a move on Move Inc!
Update: Just heard from White House spokeswoman Jen Psaki. The start date for the new $6,500 credit for existing homeowners will take effect as soon as Obama signs the bill into law tomorrow (Nov. 6). Sorry for the confusion. And thanks to "Dean" whose comment alerted me to my error. (In case you're curious, this is the actual text of the bill. The credit extension was attached to a larger bill to extend unemployment benefits).
My last post was flooded with comments from readers asking whether the expanded credit will apply to them even though they closed on a home purchase earlier this year (or last year or the year before...). The answer: "No."
It might seem unfair. But the new credit will take effect only after President Obama signs the measure into law tomorrow. Buyers will have until April 30 to sign purchase contracts and must close on the house by the end of June.
Under the new $10.8 billion plan, first-time buyers would continue to get $8,000 for buying a home. But existing homeowners will now be able to claim $6,500 credit for selling their current home and buying a new one, as long as they resided in the home they're selling for at least five of the past eight years.
Income limits will also expand to $125,000 a year for individuals, and $225,000 a year for married couples. Sounds like a good deal right? Not judging from the flood of comments we've gotten from existing buyers who bought during the past several months. They feel gypped.
A commenter identifying himself as "Jim" said he bought a home during the Great Recession and was miffed that he didn't get a tax credit because he wasn't a first-time buyer. Now he's angry.
"If they are handing out free money, give it to those who actually risked their capital," he wrote a couple hours ago. "I am against this credit altogether ... The government deciding who gets money and who doesn't is TYRANNICAL."
I sympathize with the comments. My parents only sold their Westchester County, N.Y. home of 30 years only a week ago and bought a much-less-expensive house one 15 miles away. They certainly would have qualified for the $6,500 credit and I'm afraid to break the news to them.
But the point of the credit is to stimulate home sales, not to hand out spending money (Though it will indeed stimulate some consumer spending). As I mentioned in my last post, it could be even less effective and efficient than the previous credit. If that's the case, it's best to put some limits on cost. Congressional analysts estimate that the six-month extension and expansion of the credit will cost taxpayers $10.8 billion. Can you imagine the price tag if it was made retroactive to the beginning of 2008?
Waiting for a bus on my way to work I picked up a copy of the real estate sections of The Korea Times, a local newspaper serving the Korean community in Los Angeles. That’s right the real estate sections. There were two, a total of 32 pages of real estate coverage and advertisements in one day’s newspaper. This at a time when falling circulation and ad revenue forced the Los Angeles Times to fold its separate real estate coverage into the business section.
From the ads it seemed the target was real estate investors. There were advertisements from agents that highlighted the income the properties throw off. That's something you don't typically see in mainstream newspapers. There were also brokers pitching 1031 exchanges, a way for real estate investors to defer taxes on sales.
I used to live in LA’s Koreatown neighborhood so I know a lot of money flowed into real estate development during the boom, some of it from South Korea. I’m sure a lot of folks lost money in the past few years. But those fat real estate sections—even though I couldn’t read most of what was in them—reminded me how entrepreneurial immigrants can be, particularly those from Korea.
Lacking in many cases the language skills to get jobs in Corporate America, Korean-Americans start their own businesses. LA has recently seen an explosion in Korean BBQ taco trucks, for example. Others still see real estate as a way to get their piece of the American Dream.
President Obama could sign the $10.8 billion homebuyer tax credit extension and expansion plan into law as soon as next week. The Senate this evening voted 98-0 in favor of the extension. The House is expected to approve it within days.
But a new report from Goldman Sachs suggests that the six-month extension might do little for the fragile housing market and could be even less effective than the soon-to-expire credit for first-time buyers that cost taxpayers about $8.5 billion and lasted nearly a year.
The Congressional proposal would give buyers until April 30, 2010 to sign purchase contracts and another 60 days to close. And it will no longer be just for first-time buyers. Homeowners who have lived in their current home for five of the last eight years can claim $6,500, under the new law, which would only apply to houses purchased after the current tax credit expires Nov. 30. Income limits will be more generous: $125,000 a year for individuals, $225,000 a year for married couples.
But Goldman Sachs economist Alec Phillips says, in a report released to clients Nov. 3, that the expanded program won't raise home prices and sales much and likely won't significantly trim the supply of unsold homes.
"The extension of the current credit will probably result in some incremental first-time buying but not as much as the last one," Phillips said in a phone interview today. "The expansion to the other population of buyers [existing homeowners] will provide a small boost to prices, but no more than 1%."
According to Phillips' calculations, all but about 200,000 of the 1.4 million first-time buyers who claimed the credit this year would have purchased a home even without the incentive. And the credit resulted in boosting home prices only by about 1%(Phillips assumed in his calculation that home prices rose in part because sellers built a large portion of the credit into their asking prices).
The pool of first-time buyers who still need an incentive to get off the fence is likely small because many of them have already taken advantage of the now-expiring credit. Existing homeowners who qualify for the new $6,500 credit could spur additional sales. But the supply of unsold homes will remain unchanged because most homeowners will have to sell their existing home in order to buy a new one (The credit only applies to principal residences).
This doesn't mean that the credit is useless, only that it is inefficient. For one thing, it could stimulate the economy by giving consumers more money to spend. (Economist Simon Johnson argued in the Washington Post last week that the tax credit is both inefficent as a homebuyer incentive and as a economic stimulus).
"We were not arguing that [the expanded credit] would have no effect," Phillips said. "Just will the effect be as great as last one?"
LoopNet.com, a Web site for commercial real estate listings, took a poll of 1,000 its members in the last two weeks of October. LoopNet members include real estate investors, brokers and owners. The results suggest that unlike those in the rebounding housing market, commercial real estate players are a little more gloomy.
When Will the Commercial Real Estate Market Recover?
In July a vast majority (66%) expected the volume of commercial real estate transactions to rebound in 2010. Now that number has decreased to just over 50%. Instead there has been a sharp increase (up 13% to 46%) in those expecting the recovery won't occur until 2011 or later. Investors are more pessimistic, with a median expectation of recovery timing that is approximately one quarter later than that of brokers or commercial property owners.
Have Commercial Real Estate Prices Hit Bottom Yet?
More than half of all respondents expected to see future declines of 11% or more. All three groups surveyed expect values to drop further. Owners are the most optimistic, with nearly 20% saying prices have already bottomed.
When Will Commercial Real Estate Sales Prices Hit Bottom?
Expectations for when pricing will bottom mirror that of when transactions will recover: The second quarter of 2010 was the most common choice, but more than 10% said 2012.
What are the Biggest Barriers to Commercial Real Estate Market Recovery?
Lack of access to debt financing is the #1 barrier to market recovery, according to survey participants. High asking prices were the #2 reason cited by investors and brokers, while owners considered this less of an issue. Uncertainty about future cash flows remains a significant factor.
Treasury Secretary Timothy Geithner told the Economic Club of Chicago last week that commercial real estate would not be a drag on the nation’s banking system the way housing markets have been. "That's a problem the economy can manage through even though it's going to be still exceptionally difficult," he said.
The Treasury Department is reportedly reviewing a proposal for Goldman Sachs to buy millions of dollars in low-income housing tax credits (LIHTCs) from Fannie Mae.
According to several news outlets Monday, the possible deal is raising scrutiny because federal officials need to make sure that it is in the best interest of taxpayers.
Goldman Sachs officials have remained mum about a potential transaction.
Fannie Mae and Freddie Mac were huge buyers of LIHTCs up to a few years ago. Freddie has also reportedly been considering a sale of its tax credit portfolio.
Here's a recent "Scam Alert"sent out by ARMLS®. Realtors® and anybody who owns a vacant home should beware:
SCAM ALERT: Check Your Vacant Listings
A recent scam reported to ARMLS® involves tenants moving into a pending short sale listing. The surprised listing agent contacted the owner who had not rented the property to anyone. The tenants (two women with two children) were physically moving in and had turned on utilities in their name. The sign and the lock box were removed, and all locks were re-keyed.
The tenants responded to a For Rent sign in the yard. They gave someone $1,800 as rent and signed a lease. While the short sale was able to close, the unfortunate victims of this scam were out $1,800 with no place to live.
This down economy encourages some people to take advantage of others. Listing agents should check their vacant listings regularly and provide neighbors their contact information in case they observe any suspicious activity.
So sellers - keep an eye on your vacant homes and/or ask your neighbors to watch for suspicious activity. Realtors® - check your vacant listings. And renters - verify the owner/history of the property you're renting, and check out your potential landlord!
Federal housing officials announced a series of proposals today to ensure that their core housing programs are open to all, regardless of sexual orientation or gender identity.
The Department of Housing and Urban Development (HUD) said it will also commission the first national study of discrimination against members of the lesbian, gay, bisexual, and transgender (GLBT) community.
HUD officials said a proposed rule will:
• Clarify that the term "family" as used to describe eligible beneficiaries of our public housing and Housing Choice Voucher programs include otherwise eligible lesbian, gay, bi-sexual or transgender individuals and couples. HUD's public housing and voucher programs help more than three million families to rent an affordable home. The department's intent to propose new regulations will clarify family status to ensure its subsidized housing programs are available to all families, regardless of their sexual orientation or gender identity.
• Require grantees and those who participate in the department's programs to comply with local and state non-discrimination laws that cover sexual orientation or gender identity; and
• Specify that any Federal Housing Administration-insured mortgage loan must be based on the credit-worthiness of a borrower and not on unrelated factors or characteristics such as sexual orientation or gender identity.
The move comes at a time when activists have criticized the administration for not doing enough for the GLBT community.
Knowing that I'm a Realtor® and that much of my income is dependant upon the real estate market, you might be surprised as you read my opinion on extending and/or expanding the Homebuyer Tax Credit. For starters, I'll say that I believe the free market can almost always solve problems better without government involvement. Unfortunately, the real estate market has not been allowed to operate without government interference for some time. I'll even go one step further and say that government interference caused the real estate market bubble and resulting crash, and the same idiots who created the problem should not be trusted to fix it.
Politicians, who wanted to buy votes by forcing banks to give loans to people who could not afford to pay them back, are the primary cause of the real estate bubble and ultimate crash (which I believe also caused the current recession). This effort was driven by bleeding-heart liberal Democrats, but many of the so-called conservative Republicans shamefully went along with it for many years and many administrations. We all know what happens when banks are forced to lend money to people who can't afford to pay it back... eventually they don't pay it back and the banks lose money. The banks then have to make up these losses somewhere else: either by charging good customers more, or by (the new trend of) getting billions in bailout dollars from taxpayers. So either way, hard-working taxpayers lose when government forces businesses to make bad bets.
But instead of recognizing that government is the problem, our brilliant bureaucrats instantly (and without any real thought) decided that more government is the answer. So they offered $8,000 refundable tax credits (aka govt handouts) aimed at first time homebuyers who otherwise could not afford to buy a house. HELLO? These are the people whose loans are currently foreclosing at astronomical rates. Incentivizing people who can't really afford a house into buying one anyway isn't going to fix the real estate market or the banking situation. This is what caused the problem! Repeating the same mistake will only prolong the agony and further stress the financial institutions that finance these properties. Not to mention the fact that it's inherently unfair to ask some taxpayers to pay higher taxes so the government can give their money to others for a down-payment on a new house they can't really afford. And then add insult to injury by forcing those same taxpayers to bail out the banks when these loans foreclose, as if it were not foreseeable (right!).
So like cash-for-clunkers, I believe the First Time Homebuyer Tax Credit was a stupid idea, and therefore extending or expanding it will ultimately do more harm than good to the real estate market. It may cause a short-lived spike in sales like cash-for-clunkers did (at the cost of future sales, by the way). But do we really want manic ups and downs in the real estate market, or do we want a slower but sustainable growth? I think anyone who owns real estate or works in the real estate industry would agree that a slow, sustained growth is better for all of us in the long run. Some lawmakers and various Realtor® associations are pushing to increase the tax credit to $15,000 and extend it to more than just first time homebuyers, with a higher limit on the buyer's income. To me, this is just the same dumb idea with longer lines of people taking the handout, and with a much higher price tag.
So when will the real estate market start to recover if government stops interfering? It's already started to recover, in Arizona at least. Keep in mind that national statistics quoted in the news may not be applicable to Arizona's real estate market. Real estate is local. Arizona was one of the first and hardest hit areas of the country when the real estate bubble started to burst (for lack of a better term!). And I think Arizona was also one of the first to start recovering, because Arizona real estate prices were driven down faster and lower than other areas. And lower prices is what makes buyers start coming out.
Don't get me wrong, the Arizona real estate market is not all sunshine and lolli-pops. Not at all. There are still tough times ahead, but people are buying despite the fact that banks aren't really lending like they should be (I guess it's more profitable for banks not to lend, and suck up taxpayer bailouts instead!). But if the government just stays out of the way, the market will slowly recover on its own - without unnecessary, artificial government stimulation that really just wastes billions in taxpayer's money.
Here's a snapshot of the current Phoenix metro area real estate market, as I see it:
At the end of last year, the real estate market in the Phoenix metropolitan area started to pick up... not because of any government program, but because the free market works. When prices came down to a certain level, the investors came out to play. Some of those who were sitting on the sidelines waiting decided it was time. And people started buying again... not in huge droves like a few years back when people were fighting each other for houses. But then again, who wants that, really? (I was taught that slow and steady wins the race!).
Since then, I've seen a steady flow of buyers into the market, and many banks/real estate agents are even creating bidding wars again. Of course, these bidding wars are driven by totally fabricated demand. The bank has a real estate agent list the house for a super low price to attract multiple offers. Then instead of rejecting any of the offers, they entice all of the propsective buyers into a bidding war and tell them to make their "highest and best offer". None of the buyers know what the other bids are, so they often times end up bidding higher than they should because they get sucked into the emotion of 'wanting to win the bid' rather than rationally determining what the house is worth without that emotion present. I always tell buyers to avoid bidding situations, even in a sellers market. But especially in the current buyer's market... there are still way too many houses available for sale right now to get into a bidding war. Go find a seller who appreciates your offer more and is willing to negotiate under your terms. In a buyer's market, the buyer should feel like they're driving the terms of the deal, not the seller.
But realize that Arizona's residential real estate market still faces significant foreclosures, and this will continue for some time. Supply is good for buyers and you shouldn't let uncertainty scare you away from the market if you're buying an owner-occupied home that you plan to keep for at least 3-5 years. However, I would advise inexperienced investors to be very careful buying Arizona real estate right now, especially if you plan to do a short-term flip. There's money to be made, but you can also lose a bunch so just know what you're doing.
In my opinion, Arizona's real estate market is recovering, but is not out of the woods yet. The biggest danger to this recovery (other than government interference) is the commercial real estate market. I'm not sure why nobody is talking about it, but the commercial market could create huge problems in the coming years, especially if banking problems are not addressed. Commercial real estate market trends lag the residential market, and I don't think we've even started to see the real impact of the commercial market yet. Here's why: Many commerical real estate mortgages are 5-year or 10-year interest-only loans with balloon payments due at the end of the term. So as those commercial loans made at the height of the real estate bubble start to come due (as they currently are), the property owner (probably a small business owner) will have only a few choices. They either have to pay off the entire balance, which is unlikely for most businesses since they're probably already struggling to make ends meet. Or they'll have to re-finance the loan, which is also unlikely because 1) property values are much lower now and the property is probably not worth the loan amount anymore, and 2) lending standards are tighter and commercial loans are very hard to get. So if these loans can't be re-financed or paid off, the only other option is to sell the property before the loan is due. Many property owners will wait too long, not realizing how long it takes to sell a commercial property in today's market and will consequently face foreclosure. For this reason, I believe the commercial market could be the next big real estate crisis.
Of course, I don't have a crystal ball, and nobody really knows for sure what tomorrow will bring. Everybody with an opinion on the future of the real estate market is really just guessing :) So my advice is guess carefully, and as always, buyer beware!
The California Tax Credit Allocation Committee is requiring developers who have received a preliminary reservation of American Recovery and Reinvestment Act (ARRA) funds to attend a workshop that will provide an overview of the loan process, disbursement procedures, reporting requirements, and other key information.
Two additional workshops have been scheduled—Sept. 29 in Sacramento and Oct.1 in Los Angeles.
Applicants who have received a preliminary ARRA reservation must attend one of the committee’s workshops. Two earlier sessions have taken place.
For a registration form and more information, visit www.treasurer.ca.gov/ctcac.
-SFHomeBlog.com - A San Francisco Real Estate Blog » read more ..
Foreclosure Sale (REO): a foreclosure/REO sale is the sale of a home by the financial institution which foreclosed upon it. (The term “REO” refers to the bank department “Real Estate Owned”.)
Short Sale: a sale in which the existing property loans, other monetary liens and costs of sale exceed the sale price – i.e. the owner owes more than the property is worth. In a short sale, the lien holders—typically the bank(s)—have to agree to a reduced payoff for the sale to close. Short sales are complicated, usually take much longer to close escrow and may have significant ramifications that need to be recognized, but they can be a preferable alternative to foreclosure for sellers and can present buyers with purchase opportunities worth considering.
In the past year, 20% of all San Francisco house sales -- 403 sales -- have been REO or short sales: 14% REO and 6% short sale. All SF house sales (reported through MLS) totaled just below 2000 for the 12 months ending 8/31/09.
In the past year, 9% of city condo sales -- 130 sales -- have been REO or short sales. All SF condo sales reported through MLS totaled 1452. (Many new-development condo sales are not reported through MLS.)
There were only 2 TIC REO/short sales out of a total of approximately 350 Tenancy-in-Common units sold.
Approximately 80% of all SF REO and short sales of houses occurred in the city’s less affluent, southern border neighborhoods stretching from Ingleside Heights and Oceanview through Crocker Amazon, Excelsior and Portola to Bayview/Bayview Heights.
Approximately 6% were in the Sunset/Parkside district; 3 - 4% occurred in Bernal Heights. There was a Pacific Heights REO sale that exceeded $11,000,000 – the largest SF home sale in 2009 year to date – though other than that 9-bedroom mansion, the higher end has been relatively unaffected so far by foreclosures.
58% of all REO house sales in the past year went pending sale within 30 days of going on market (i.e. very quickly) to close at an average of 6% above the list price: a hot market marked my multiple offers.
Approximately 47% of all SF condo REO/short sales happened in Realtor District 9 which stretches from South Beach and Mission Bay through SOMA, Inner Mission, Potrero Hill and Bernal Heights – SOMA is the area with the greatest number of these distress condo sales.
Another 30% occurred in the southern boundary neighborhoods mentioned above. The rest are scattered throughout the city. As of September 11, 2009, there were 30 active REO house listings and 22 active REO condo listings; there were 56 active short-sale house listings and 46 active short sale condo listings. REO and short-sale listings constitute 15% of the total active houses listed and 8% of the total active condos listed.
As of 9/11/09, there were 43 REO house listings and 31 condo listings that had accepted offers but not yet closed; there were 105 short-sale house listings and and 75 short-sale condo listings that had accepted offers but not yet closed.
Generally, REO sales take longer to close escrow than regular sales (think bank bureaucracy and paperwork) and short sales take much longer – 60 to 120+ days (add complicated buyer/seller/lender negotiations to bank bureaucracy) – which explains the high number of pending REO & short sales as compared to active listings and closed sales for these types of transactions. They just take a lot longer to close.
The median sales price for an REO/short-sale house was from $490,000 to $520,000 as compared to the general median house sales price of $730,000 (all sales) over the past year. The 20% of REO/short sales had a significant lowering effect on the overall median house price. The median REO condo sales price was $437,000; the median short-sale condo price was $539,000. The median sales price for all condo sales over the past year was $679,000.
San Francisco continues to have one of the lowest foreclosure rates in the state. According to DataQuick, in the 2nd quarter of 2009, there were 136 home foreclosures in the city (bank foreclosure repossessions, not bank resales of foreclosed homes) as compared to 1466 in Alameda County, 2048 in Contra Costa County and 6706 in Los Angeles County. On a per capita basis, the SF foreclosure rate was far below even Marin and Napa Counties.
Foreclosure Avoidance Counseling: The Department of Housing & Urban Development (HUD) offers free counseling services. You can find help understanding your options here: [www.hud.gov].
Loan Modification Programs: More information about government supported home loan modification programs can be found here: [makinghomesaffordable.gov].
In the midst of a recession last year, the nation's poverty rate rose to an 11-year high.
The rate jumped to 13.2 percent in 2008, up from 12.5 percent the year before. In other words, there were 39.8 million people living in poverty last year compared to 37.3 million in 2007, according to data released today by the Census Bureau.
The poverty rate is the highest since 1997.
The weighted average poverty threshold for a family of four in 2008 was $22,025; for a family of three, $17,163; for a family of two, $14,051; and for unrelated individuals, $10,991.
The Census Bureau also reports that the median household income fell 3.6 percent between 2007 and 2008, from $52,163 to $50,303. "This breaks a string of three years of annual income increases and coincides with the recession that started in December 2007," says the Bureau.
-SFHomeBlog.com - A San Francisco Real Estate Blog » read more ..
San Francisco HOUSE Sales $500,000 - $649,000
October 15, 2008 – August 1, 2009
Total Sales: 356 (23% of the city’s house sales)
Total REO (bank-owned) Sales: 74
Known Short Sales: 48
This is the most active segment by volume for houses, and unit sales were up 41% year over year. Once again, most of the sales, 63%, occurred in the city’s less affluent southern neighborhoods: Excelsior, Portola, Crocker Amazon, Ingleside & Oceanview. But there were also 53 sales in the Sunset/Parkside districts, 21 in Bernal Heights, 17 in Sunnyside/Miraloma, and 6 in Glen Park.
21% of sales in this price range were REO sales. (In San Francisco, the higher the price range, the fewer the foreclosures.) The neighborhoods with the most REO sales in this price range were again on the southern border, Ingleside/Oceanview across to Portola/Visitacion Valley, though there were also a few each in the Sunset, Glen Park, Bernal Heights and Sunnyside.
53% of these REO sales went pending sale within 30 days of going on market (i.e. very quickly) to close at an average 6% above list price.
Median room configurations and sales prices, and average square footage and dollar per square foot for house sales by neighborhood.
Okay, just when you thought things in the mortgage industry couldn't get any more insane... Wells Fargo files a lawsuit against itself. That's right, Wells Fargo Bank NA v. Wells Fargo Bank NA.
Apparently, the lawsuit is related to a mortgage foreclosure case in Hillsborough County, Florida. Wells Fargo spokesman, Kevin Waetke reportedly said, "The primary reason is to clear title and ownership interest in a property to prepare it for sale".
Personally, I've never found it necessary to sue myself in order to prepare a property for sale. But then I've also never been dumb enough to give both a first mortgage and second mortgage to the same person on the same house either. So I guess it makes perfect sense if you're a "too big to fail" lending institution like Wells Fargo. You know, the kind where the right hand doesn't know what the left hand is doing so they end up hiring lawyers to sue themselves, and then have to hire lawyers to defend themselves too. Who knows, it might be a brilliant legal strategy because even if Wells Fargo loses, they also win! But then even if they win, they also lose.
The biggest losers here are the taxpayers who bailed this company out thinking it was "too big to fail". Sometimes stupidity needs to be allowed to fail. If Wells Fargo has nothing better to do with the BILLIONS of taxpayer dollars they received under the recent government bailout (TARP), why don't they just pay it all back?
-SFHomeBlog.com - A San Francisco Real Estate Blog » read more ..
The exact reason No Income Verification loans were created in the first place is the exact challenge now facing numerous potential homeowners who no longer can get a loan - unless you know a R E A L L Y good mortgage broker who has a personal and private relationship with some good banks. Oh, and by the way - this is also the same reason Chris Daly's rental assistance law is diabolical. There's no way to account for undocumented income...
With more than $300,000 in combined annual income, tens of thousands of dollars in the bank and credit scores that top 800, Jennifer France and her partner would seem like ideal candidates for a mortgage refinance. But when they applied to swap an interest-only loan on their nearly $1 million San Carlos home for a 30-year fixed that locked in today's low rates, they were summarily denied. The reason: effectively, because both operate their own businesses.
"I was really surprised, I had been preparing to refinance for years," said France, a landscaper and gardener. "It's hard for the self-employed; that puts us in a bind."
While the amount they make is easily enough to qualify for the new loan, tax deductions for self-employed workers dropped their official income below the threshold that banks wanted to see. A few years ago, theirs would have been the ideal scenario for a stated-income or no-documentation loan, which allowed individuals with ample but unconventional sources of income to secure home loans. But after untold numbers of borrowers lied about their financial wherewithal to buy homes they couldn't afford, often with a wink and nod from mortgage brokers, nearly all lenders stopped offering what became known derisively as "liar loans." Now even the well-qualified borrowers for whom the products were first intended can't get them. [more]
-SFHomeBlog.com - A San Francisco Real Estate Blog » read more ..
SAN FRANCISCO — The world’s largest drug maker has abandoned plans to move into a new research center in San Francisco’s burgeoning Mission Bay neighborhood. What was hailed last summer by Mayor Gavin Newsom as a “significant win” in the development of Mission Bay is now a loss for the area, which has attracted numerous life science companies in recent years as a result of payroll tax breaks offered by The City.
Pfizer had planned to take up a bulk of a new building on the corner of Third Street and Mission Bay Boulevard. The company negotiated a 15-year lease with the builders, Alexandria Real Estate Equities Inc., and said they planned to move 100 employees there from their South San Francisco office in early 2010. Newsom announced the deal in August 2008, alongside Corey Goodman, the president of Pfizer’s Biotherapeutics and Bioinnovation Center, who said the move would position the center for success. Signs that the deal could be in jeopardy surfaced in November, when Alexandria announced they would be putting two Mission Bay properties on hold, but would not elaborate on the specific sites. Goodman then unexpectedly resigned in April — just months after Pfizer acquired drug maker Wyeth in a $68 billion deal. A spokeswoman for Pfizer, Joan Campion, said the company did notmake its decision based on recent leadership changes, but by analyzing its real estate holdings after acquiring Wyeth. “Economics was a factor,” Campion said. The fate of the building is still unknown. A public relations firm for Alexandria Real Estate Equities did not return calls for comment.
Before adjourning July 1, the Arizona House defeated a bill (HB 2280) by Senator Russell Pearce that would have cracked down on pro-illegal alien “sanctuary” laws and aided in immigration enforcement by expanding the state’s trespassing law. While the Senate approved the bill 16-11, the House was five votes short of the 31 needed for passage.
Democratic politicians usually oppose illegal immigration enforcement, as they need the pro-illegal money and votes to get re-elected. But three Republicans also opposed this bill even though the State Republican Party unanimously passed a resolution supporting it and numerous law enforcement organizations endorsed it (at least those who haven’t had long-standing ties with open-borders groups and cheap-labor business lobbyists). The 3 Republicans and 12 Democrats who opposed this bill were:
What's really disturbing is that 19 members of the House (listed below) did not even vote on the bill at all. Shame on them. I was told the six Republicans listed below physically left the Capitol building so they didn’t have to go on record as opposing HB 2280 (sadly, my Representative was among them):
Is this really what we pay our elected officials to do... play both sides of the aisle and hide their true beliefs so nobody knows what they support or oppose? I know I didn't vote for that. I expect my elected representatives to help Americans, not illegal immigrants. And no, I'm not a racist although the pro-illegal immigration crowd will say anyone who wants our immigration laws enforced must be a racist (so go ahead and send the emails anyway - my delete key is ready!). I simply want our laws to be respected by all. You and I must obey the law or pay the consequences. Why are illegals getting a free pass at our expense? Our immigration laws have been ignored for long enough, and selective enforcement of some laws results in lack of respect for all laws. If all laws are not enforced, how do you know which ones they're really serious about?
So what does this have to do with real estate? PEOPLE DON'T WANT TO LIVE IN SANCTUARY CITIES. Eliminating sanctuary city policies will not only aid law enforcement and make our cities safer, but this bill will also alleviate some of our financial problems. Sanctuary cities are plagued with increased costs and decreased quality of education, healthcare, law enforcement and all other social services. Sound familiar?
Our current budget mess reminds us that Arizona can't even afford the services it's currently providing. So do we raise taxes, reduce services & quality of services provided to legal residents, or eliminate services for those who are here illegally mooching off the rest of us? Seems kind of like a no-brainer to me, especially considering that many legal Arizona residents are currently unemployed and in need of assistance. But then I'm just a lowly taxpayer so I don't have all that special "State Representative" knowledge that's required to make such important decisions with other people's money.
The defeat of this bill means that sanctuary policies, like those in Mesa and other Valley cities, will continue to:
Protect criminal illegals from deportation
Allow illegals to take benefits intended for needy Arizona residents
Allow illegals to take jobs that should go to legal Arizona residents
When public assistance agencies are prevented from inquiring about an applicant's immigration status, benefits are distributed to ineligible illegal aliens. Sanctuary policies directly violate Federal law and make it easier for illegal aliens, including criminal aliens, to live undetected in Arizona. How many citizens, including police officers, have to die or be maimed before we decide to enforce our immigration laws?
ATTENTION STATE LAWMAKERS: If you oppose a bill, at least have the backbone to stand up and say so. Otherwise, don't ask for my vote next time you run for re-election... because I will show up to vote against you (and I'll encourage everyone I know to do the same). And by the way, illegal immigrants don't vote, but angry American citizens do.
If your AZ Representative is listed above, be sure to email them and let them know how you feel about their vote (or lack thereof) on this issue. Just click the email address of your Representative to send a pre-written letter, or edit the email to say whatever you'd like. Click here to look up your Representative.
I know I haven't blogged forever and a day, so I guess it's time again! How could I have stayed away so long with so much to blog about lately? Honestly, I've been overwhelmed with work and life in general. Since the end of last year, the real estate & home inspection business have kept me working 12+ hour days, 7 days a week. Funny how the free markets actually work if the government stops interfering long enough to allow it. When AZ real estate prices came down low enough (last year), the buyers started to come out and inventory has come down significantly now. No, it wasn't the stimulus or the tax credit - it was lower prices (a function of supply and demand, not government intervention).
For those of you who have emailed and left comments telling me to update BlogArizona... thanks! Even after months of not blogging, BlogArizona has still been visited by thousands of loyal readers and the search engines still seem to like us quite a bit. In fact, I still rank high enough to command attention from the bubble bursting crowd (what an honor!). After being quoted in this LA Times article by Nicholas Riccardi (which was also picked up by the Chicago Tribune, etc), I was recently bashed by Boom2Bust because I wasn't negative enough when discussing the Arizona real estate market. Okay, in all fairness, Boom2Bust was actually criticizing the use of Arizona real estate professionals as sources for the article... an article which happened to be about the Arizona real estate market (need I say duh???). Here's what Boom2Bust says about the Chicago Tribune article...
"Nicholas Riccardi wrote on June 7:
Phoenix’s housing bust has turned into a quasi-boom, a sign that its market might have hit bottom and a preview of what a housing recovery could look like.
More homes are selling than at any time since 2006. Prices are slowly stabilizing. Buyers again are in bidding wars — only this time over foreclosed houses selling at deep discounts rather than ranch homes listing for vast sums.
Riccardi’s sources? Individuals who could stand to gain from a rebound in the Phoenix housing market. From the piece:
“The free market is at work,” said Shannon Hubbard, a real estate agent and blogger. “Prices got driven down so much that people said, ‘I’m going to come out and play.’ “
Hubbard writes on BlogArizona.com:
I’m a Realtor-Investor, maintaining an active real estate license with Great American Realty, Inc. I’m also Co-owner of Homewerx Home Inspections, and Owner of BlogArizona.com."
There were a few other AZ real estate professionals quoted, and Boom2Bust concluded/implied that real estate agents just say good things about the real estate market so they can make money. So who should Mr. Riccardi have called to interview for his article about the Arizona real estate market... some doctors in Nicaragua? Everything stated in the article was true, and the sources for the information were fully and accurately disclosed - so what's the problem? Boom2Bust goes on to give alternate sources of information about the Arizona housing market, to balance the opinions of us greedy real estate professionals who were quoted...
"So, is there another side to the Phoenix housing story? Well, consider the following from Bloomberg’s Kathleen Howley and Erik Schatzker today:
U.S. home prices may continue to tumble for years, according to economist and Yale University professor Robert J. Shiller.
“Our sense that housing is a wonderful investment is really damaged now,” Shiller said in an interview with Bloomberg Television today…
The Standard & Poor’s/Case-Shiller national index of home prices, named after the professor, has fallen 32 percent from a high in the second quarter of 2006."
Note that Boom2Bust uses only national statistics and sources to talk about the Arizona real estate market. Should we tell Boom2Bust that real estate is local? The national numbers mean nothing to us here in Arizona, even if those numbers come from Yale scholars (Yale isn't even in Arizona!). So Boom2Bust would prefer generic, national sources rather than first hand information from people in the AZ trenches? The Arizona real estate market was among the hardest hit and therefore the first to start the recovery (when prices got low enough). Who do you think is more likely to know when that recovery has started... a Yale professor or an Arizona Realtor?
Okay... considering I haven't blogged in many months, I guess I should just feel loved since I'm still being contacted for interviews by major newspapers and bashed by bubble bloggers. Never a dull moment. But don't worry, I'll be back for more much sooner this time. Hope you enjoyed your 4th of July weekend!
"Calm" is a relative term. For the second straight period, lenders issued one rate sheet daily on more days than they issued multiples. Contrast this to 6 months ago when lenders issued at least three rate sheets per day, on average. Versus March, volatility is increasing. Mortgage rates are changing...
Mortgage rates are notoriously volatile when the Federal Open Market Committee meets and today is such a day. Today's meeting is one of 8 scheduled FOMC meetings this year. The Federal Open Market Committee is a rotating, 12-member sub-group within the Federal Reserve that debates about financial and economic conditions...
With evidence that Swine Flu ran for the border this past weekend, mortgage rates are improving. Confirmed cases of H1N1 Swine Flu have spread to 5 continents and financial contagion has put markets in Safe Haven mode. "Safe Haven buying" is a market jargon. It describes a common trading pattern...
When banks make fixed-rate, principal + interest home loans, a borrower's monthly payment gets calculated from amortization schedules (ah-mor-ti-ZAY-shun). With respect to mortgages, amortization is the process of paying a loan to $0 over time. For homeowners, an amortization schedule's most important trait is that it creates interest-heavy repayments in...
Signing mortgage paperwork can be unsettling for people. No matter how many times a person has signed a HUD-1 Settlement Statement in their lifetime, there's something about that form that mentally makes them drop on the deck and flop like a fish. Settlement statements are confusing, no bones about it....
Are mortgage rates going up? Are mortgage rates going down? I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey may have your answers. The Bankrate.com survey is for conforming mortgages. It does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or foreign...
The Federal Reserve meets next week for a policy-setting meeting. It’s one of 8 scheduled Fed meetings this year in which the Federal Open Market Committee votes on whether to raise, lower, or leave unchanged the Fed Funds Rate. The Fed Funds Rate is the rate at which banks lend...
Are mortgage rates going up? Are mortgage rates going down? I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey may have your answers. The Bankrate.com survey is for conforming mortgages. It does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or foreign...
Mortgage rates are hovering near all-time lows. It's all over the news and the White House is telling Americans the time may be right to look at refinancing their mortgage. But just because rates are low and the government is developing programs like Making Home Affordable doesn't mean that the...
The all new Purchase Reverse Mortgage Program is designed to help seniors purchase a new home and never make monthly mortgage repayments for as long as they live in the home. The new reverse mortgage law that makes this possible took effect in January. The law requires that FHA insure reverse mortgage loans to be used for these purchases.
A senior, 62 or older, can purchase a home using a reverse mortgage instead of the traditional mortgage. Seniors who wanted to purchase a new home with poor credit, or without a steady substantial income or who are not comfortable with beginning to make monthly payments all over again, can now easily do so with the reverse mortgage purchase loan.
Call Troy Today for Details about this Exciting New Program! Please do not Delay! TOLL FREE 1-888-973-8377
If you've been a loan officer long enough, you start to notice certain trends emerge in mortgage rates, mortgage products, and in the market overall. Here's an easy trend that even the lay can understand: When loan defaults spike, mortgage guidelines get tight. It's why I'm telling you for the...
Twitter Soup for the Soul is a 122-page mashup of original photos and Twitter posts and an exercise in online transparency. The e-book is $9.97 -- half the author's proceeds will be dontated to CARE through theWeb Women Giving Circle. Frances Flynn Thorsen is a Twitterholic, blogger, journalist, blog coach, and author who writes about real estate, social media, law of attraction, and prickly pear cactus jelly. This is not a tutorial about how to use Twitter for microblogging ...
Twitter is described as a microblogging platform.Twitterers use the tool to push product, build brand awareness, instant message their friends, acknowledge and share links about trends and events and their most personal moments.
Twitter is a mashup of brilliance, idiocy, art, confusion, hyperbole, and prayer in 140-character-or-less sound bytes.
I think Twitter is even more ... Twitter is a reflection of the human soul. I've been Twittering since Sept. 8, 2007. Everything you need to know about me is contained in a bank of content there within a growing stream of some 1,749 140-character-or-less posts. My Twitter address is
I conducted a Webinar for RealTown bloggers recently ... you can insert the words "Typepad Blogs" for "RealTown Blogs" and use the same formula ... in fact, you can insert "Wordpress Blog" or "ActiveRain Blog" or any other real estate related blog with the same results!
Are mortgage rates going up? Are mortgage rates going down? I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey may have your answers. The Bankrate.com survey is for conforming mortgages. It does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or foreign...
Excuse the rerun, but this post first ran in December 2008. It's still relevant and worth a re-read. I've made some updates to reflect today's market but the song remains the same. Mortgage rates have followed an interesting pattern lately that I'm dubbing the Plunge-and-Surge. In Plunge-and-Surge trading, mortgage rates...
HUD Homes comprise a huge slice of the foreclosure property pie. But there are differences between HUD Homes and bank homes that matter to buyers and their real estate agents! This is a FREE Webinar for home buyers and real estate agents.
HUD Homes are owned by the federal government, NOT banks!
Real estate agents represent the buyers, NOT a bank, and NOT HUD.
There are inspections performed before a house is put on the market.
Join me for a discussion about HUD homes ... use the TELEPHONE option instead of computer audio if you want to take part in the conversation!
The Making Home Affordable program is officially official. Mortgage lenders are now processing applications and paperwork for the help-the-homeowner plan often referred to as "The Obama Plan". Because Making Home Affordable is a new program, there have been a lot of questions about how it works, who is eligible, and...
I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey is now available. The Bankrate.com survey is for conforming mortgages. It does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or foreign national mortgages. For rate quotes, email me directly. The group's 30-day...
As stock markets finish a quarter marked by high volatility, mortgage pricing seems to have settled down a bit. Last month, for the first time in more than a year, mortgage lenders held their morning pricing all the way through market close. This is an odd development, though; incongruent with...
This is the second-best one minute summary you'll get all day. What's the first? That's easy. The advertisement shown at right ran in Saturday's Cincinnati Enquirer. I'm using it to illustrate why you can't rely on your local paper's mortgage rate information. This is not a dig on the Enquirer,...
I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey is now available. The Bankrate.com survey is for conforming mortgages. It does not apply to FHA mortgages, VA mortgages, jumbo mortgages, or foreign national mortgages. For rate quotes, email me directly. The group's 30-day...
Here are some Reverse Mortgage features in case your forgot.
* Eliminates monthly mortgage payments
* Retain ownership of your home
* No out-of-pocket expenses and no mortgage insurance
* No income, employment or health restrictions
* Amount available depends on your age, value of your home, and current interest rates
* You never owe more than the value of your home
* Loan is not due until the last homeowner sells or permanently leaves the home
* Access loan proceeds in the form of a lump sum, line of credit, or monthly payment.
Call Troy at 1-888-973-8377 for a free evaluation and he will be glad to answer any of your questions.
The Mortgage Bankers Association reported a large drop in mortgage applications last week, though the drop was driven heavily by a 48% drop in the interest rate sensitive refinance applications after mortgage rates broke their down trend the week before. Purchase applications fell 2.9%. Both the Mortgage Bankers Association and Freddie Mac reported 30-year Fixed Rate Mortgage (FRM) rates just above 5% and 15-year FRM rates below 5%. At the current rates an 8.5% 30-year mortgage could be refinanced into a 15-year mortgage at roughly the same payment – reason enough to refinance for anyone with 3 to 5 years on a subprime loan who can qualify now for prime rates.
Housing affordability is very strong, putting some legs under the market going forward, when employment stabilizes. According to Frank Nothaft, Freddie Mac chief economist:
Both the S&P/Case-Shiller® 20-city composite index, which registered an 18 percent annual decline through November, and the National Association of Realtors® (NAR) sales data, down 15 percent in December from a year ago, indicate sharply lower house prices across many U.S. metropolitan areas. At the same time, interest rates for 30-year fixed-rate mortgages reached a 50-year low toward the end of December. These two factors contributed to housing affordability reaching its highest level since 1973, as measured by the NAR’s monthly affordability index and help to explain the 7.0 percent increase in existing home sales in December.
Mortgage Bankers Association Average Mortgage Rates
* Points reported by Mortgage Bankers Association in this survey include origination fees as well as traditional discount points. Average rates are based on an 80% LTV loan. This means a loan amount no more than 80% of the property value as determined by the lower of the purchase price or appraised value. Typically this means a 20% down payment, though an 80% loan can also be achieved with a second mortgage carried by the seller or a third party lender for the difference between the actual down payment and 20%.
MORTGAGE RATES HOLD STEADY ACCORDING TO FREDDIE MAC’S WEEKLY SURVEY
“Mortgage rates held steady this week,” said Frank Nothaft, Freddie Mac vice president and chief economist. “The index of leading indicators rose 0.3 percent in December, the first increase in 6 months, fueled by an expansion in the money supply. However, the Federal Reserve acknowledged in its January 28th policy committee statement that since December the economy has weakened further.
“Both the S&P/Case-Shiller® 20-city composite index, which registered an 18 percent annual decline through November, and the National Association of Realtors® (NAR) sales data, down 15 percent in December from a year ago, indicate sharply lower house prices across many U.S. metropolitan areas. At the same time, interest rates for 30-year fixed-rate mortgages reached a 50-year low toward the end of December. These two factors contributed to housing affordability reaching its highest level since 1973, as measured by the NAR’s monthly affordability index and help to explain the 7.0 percent increase in existing home sales in December.”
Mortgage Applications Fall In Latest MBA Weekly Survey
WASHINGTON, D.C. (January 28, 2009) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending January 23, 2009. The Market Composite Index, a measure of mortgage loan application volume, was 732.1, a decrease of 38.8 percent on a seasonally adjusted basis from 1195.3 one week earlier. This week’s results included an adjustment to account for the shortened week due to the Martin Luther King Jr. holiday. On an unadjusted basis, the Index decreased 46.5 percent compared with the previous week and 40.4 percent compared with the same week one year earlier.
The Refinance Index decreased 48 percent to 3373.9 from 6491.8 the previous week and the seasonally adjusted Purchase Index decreased 2.9 percent to 294.3 from 303.1 one week earlier. The Conventional Purchase Index decreased 7.8 percent while the Government Purchase Index (largely FHA) increased 8.8 percent.
The four week moving average for the seasonally adjusted Market Index is down 10.5 percent. The four week moving average is down 2.1 percent for the Purchase Index, while this average is down 12.7 percent for the Refinance Index.
The refinance share of mortgage activity decreased to 72.8 percent of total applications from 83.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 2.4 from 1.5 percent of total applications from the previous week.
The Mortgage Bankers Association reported a drop in refinance applications last week after Fixed Rate Mortgage (FRM) rates rose more than three-tenths of a percent and Freddie Mac’s Primary Mortgage Market Survey also showed an increase in rates, though only about half as large. The reports on Adjustable Rate Mortgage (ARM) rates were mixed. Despite the increase in rates, the Mortgage Bankers Association reported a 2.5% increase in purchase mortgage applications.
There’s bad news on the credit availability front for homeowners looking to refinance out of bad situations. Eric from Dream Home Financing reported that:
Although refinance applications have increased, many borrowers no longer qualify or the rate adjustments due to their new credit situation have resulted in little benefit to refinance.
Ditech Home Loans puts more specific numbers to the situation for refinances:
Fall out for refinance applications are estimated at 50% to 65%, because of low appraisals and qualifying issues. The new Fannie Mae and Freddie Mac appraisal code may contribute to more fall out, as well as FHA’s 2 appraisal requirement for cash out refinancing over 85%.
* Points reported by Mortgage Bankers Association in this survey include origination fees as well as traditional discount points. Average rates are based on an 80% LTV loan. This means a loan amount no more than 80% of the property value as determined by the lower of the purchase price or appraised value. Typically this means a 20% down payment, though an 80% loan can also be achieved with a second mortgage carried by the seller or a third party lender for the difference between the actual down payment and 20%.
LONG-TERM MORTGAGE RATES RISE THIS WEEK, REVERSING 11-WEEK TREND
“Fixed-rate mortgages followed bond yields and edged up this holiday week,” said Frank Nothaft, Freddie Mac vice president and chief economist. “However, over the first three weeks of 2009, 30-year fixed-rate mortgages averaged 0.25 percentage points below its monthly average for December 2008. As a result, the number of mortgage applications for refinancing was roughly about 86 percent of all conventional loans over the same time period.
“New housing construction continues to thin due to foreclosures and an abundance of unsold homes. Housing starts for 1-family homes fell 13.5 percent in December 2008 to an annualized pace just under 400,000 houses, the slowest pace since the data were collected in January 1959. In addition, homebuilder confidence fell to a record low in January since history began in January 1985.”
Mortgage Applications Decrease in Latest MBA Weekly Survey
The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending January 16, 2009. The Market Composite Index, a measure of mortgage loan application volume, was 1195.3, a decrease of 9.8 percent on a seasonally adjusted basis from 1324.8 one week earlier. On an unadjusted basis, the Index decreased 10.3 percent compared with the previous week and increased 23.1 percent compared with the same week one year earlier.
The Refinance Index decreased 12.4 percent to 6491.8 from 7414.1 the previous week and the seasonally adjusted Purchase Index increased 2.5 percent to 303.1 from 295.8 one week earlier. The Conventional Purchase Index increased 2.8 percent while the Government Purchase Index (largely FHA) increased 1.8 percent.
The four week moving average for the seasonally adjusted Market Index is down 1.0 percent. The four week moving average is down 1.0 percent for the seasonally adjusted Purchase Index, while this average is down 1.0 percent for the Refinance Index.
The refinance share of mortgage activity decreased to 83.3 percent of total applications from 85.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 1.5 percent from 1.1 percent of total applications from the previous week.
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
If you've wondered why this blog has been so quiet for the past six weeks, it's because we've been working on a new site which integrates our blog as well as content from The Real Estate Cafe's original web site. As you can see from the Google search results above, if you type in "real estate cafe," you now get over 300,000 search results. We're still #1, perhaps that's a reflection of our industry leading rebates, or the fact that we were the first real estate cyber cafe (see timeline on our wiki dating back to 1995).
A continent full of AIDS orphans -- including millions in child-headed households -- needs you to respond ASAP. See ASAP: AIDS Shelter Alliance Partner proposal on our wiki, and let us know if you'd like to view the slide show in person some at Starbucks in Greater Boston or via webinar beyond.
We look forward to sharing this campaign with other real estate innovators, particularly those offering client rebates, next week at REBarCamp in New York.
S&P reported another big drop in its Case Shiller Home Price Index, which covers the top 20 metropolitan areas in the US and the Conference Board reported that US consumer confidence fell to a record low. 14 of the 20 cities indexed had annual declines of more than 10% from October 2007 to October 2008. All the cities except Detroit were above 2000 price levels, the top 10 were at 169.78% of 2000 levels, all 20 were at 158.16% of 2000 levels. The indexes peaked in July 2006; the Composite 10 is down 25% from that level and the Composite 20 is down 23.5%.
Several points worth noting:
No city except Detroit is below the year 2000 price level, the year that began the housing boom.
On average, homes have appreciated more than 50% in 8 years even after the declines.
Charlotte, NC rose to a peak of 127.96% of the 2000 level and is now at 127.08% of the 2000 level.
The cities with the biggest gains have fallen the farthest.
New York, Portland, Dallas and Seattle have also maintained home prices fairly well with New York at 190% of 2000 levels.
The variation is huge. All real estate is local. Location, location, location.
Freddie Mac and the Mortgage Bankers Association are both reporting 30-year rates near 5% and 15-year Fixed Rate Mortgage (FRM) rates below 5% for a second week. Buyers have responded aggressively to the lower rates, with mortgage applications for home purchases up more than 10% last week.
With prices dropping in both the existing home and new home markets according to reports released earlier in the week and consumers real disposable income rising last month, housing affordability is considerably improved – a good sign for sales early next year. According to Frank Nothaft, Freddie Mac chief economist:
Interest rates on 30-year fixed-rate mortgages eased for the eighth straight week and set another record low since Freddie Mac’s survey began in 1971.
* Points reported by Mortgage Bankers Association in this survey include origination fees as well as traditional discount points. Average rates are based on an 80% LTV loan. This means a loan amount no more than 80% of the property value as determined by the lower of the purchase price or appraised value. Typically this means a 20% down payment, though an 80% loan can also be achieved with a second mortgage carried by the seller or a third party lender for the difference between the actual down payment and 20%.
Near Record Low Mortgage Rates Boost Mortgage Applications
WASHINGTON, D.C. (December 24, 2008) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending December 19, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 1245.4, an increase of 48.0 percent on a seasonally adjusted basis from 841.4 one week earlier. On an unadjusted basis, the Index increased 50.2 percent compared with the previous week and was up 124.6 percent compared with the same week one year earlier.
The Refinance Index increased 62.6 percent to 6758.6 from the previous week and the seasonally adjusted Purchase Index increased 10.6 percent to 316.5 from one week earlier. The Conventional Purchase Index increased 17.7 percent while the Government Purchase Index (largely FHA) decreased 3.4 percent.
The four week moving average for the seasonally adjusted Market Index is up 28.8 percent. The four week moving average is up 4.5 percent for the seasonally adjusted Purchase Index, while this average is up 42.0 percent for the Refinance Index.
The refinance share of mortgage activity increased to 83.2 percent of total applications from 76.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 0.8 percent from 1.1 percent of total applications from the previous week.
LONG-TERM RATES FALL FOR EIGHTH CONSECUTIVE WEEK SETTING ANOTHER NEW LOW
Shorter-Term Rates Are Mixed
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.14 percent with an average 0.8 point for the week ending December 24, 2008, down from last week when it averaged 5.19 percent. Last year at this time, the 30-year FRM averaged 6.17 percent. The 30-year FRM has not been lower since Freddie Mac started the Primary Mortgage Market Survey in 1971.
“Interest rates on 30-year fixed-rate mortgages eased for the eighth straight week and set another record low since Freddie Mac’s survey began in 1971,” said Frank Nothaft, Freddie Mac vice president and chief economist. “Real GDP growth fell 0.5 percent in the third quarter of the year, pulled down by the largest drop in consumer spending since the second quarter of 1980. The market consensus calls for an even larger decline in the last three months of the year.
“The housing market, meanwhile, continues to contract. Existing home sales (excluding condominiums and co-ops) fell 8.6 percent in November to 4.0 million houses (annualized) in November, representing the slowest pace since July 1997. Moreover, the median sales price fell 12.8 percent from November 2007, the largest 12-month decline since records began in January 1968, according to the National Association of Realtors®.”
The Mortgage Bankers Association and Freddie Mac both reported good news for those needing to refinance mortgages and those with resetting ARMs with the MBAA reporting an average 15-year Fixed Rate Mortgage (FRM) rate below 5% and Freddie Mac reporting a 1-year ARM rate below 5% and 15-year FRM rates below 5%. Even 30-year FRM rates are flirting with 5% according to both reports. The Mortgage Bankers Association reported an increase in refinance activity and a small drop in purchase applications last week.
In other housing news, the National Association of Homebuilders reported that builder sentiment held steady at a record low in November and the Commerce Department reported another drop in housing starts. With new home inventories still in the 10 month range, the drop in housing starts to a level a little over half the November 2007 level is good news for homeowners, but bad news for construction workers, building suppliers and for home buyers who wait too long to buy. NAHB Chairman Sandy Dunn blames sales conditions for the negative sentiment:
While builders are doing everything we can in the way of price and non-price incentives to move new homes off the books, buyers are afraid to move forward, and in any case there is almost no way to compete with the cut-rate product that is continually flooding the market from mounting foreclosures.
Buyers need to, carefully of course, take advantage of the real bargains that are starting to pile up whether it’s from foreclosures or builder incentives, as with building slowing this much and mortgage freezes in place inventories are going to drop and when they do the bargains will dry up.
Mortgage Bankers Association Average Mortgage Rates
* Points reported by Mortgage Bankers Association in this survey include origination fees as well as traditional discount points. Average rates are based on an 80% LTV loan. This means a loan amount no more than 80% of the property value as determined by the lower of the purchase price or appraised value. Typically this means a 20% down payment, though an 80% loan can also be achieved with a second mortgage carried by the seller or a third party lender for the difference between the actual down payment and 20%.
Builder Confidence Remains At Record Low In December
December 15, 2008 – Builder confidence in the market for newly built single-family homes held at a record low in December as deepening economic turmoil, a deteriorating job market, and an ongoing flow of foreclosed homes onto the market continued to negatively impact sales conditions. The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) did not budge this month from November’s all-time low reading of 9, with two out of three component indexes losing further ground.
“The crisis continues,” said NAHB Chairman Sandy Dunn, a home builder from Point Pleasant, W. Va. “While builders are doing everything we can in the way of price and non-price incentives to move new homes off the books, buyers are afraid to move forward, and in any case there is almost no way to compete with the cut-rate product that is continually flooding the market from mounting foreclosures. Congress and the Administration must step in with substantial incentives to bring qualified buyers back to the table as well as effective foreclosure relief programs if we are to end this negative spiral that is weighing so heavily on our national economy.”
“We have seen no improvement over the past month in terms of sales conditions for new homes,” said NAHB Chief Economist David Crowe. “In fact, certain factors have gotten progressively worse, not the least of which is the job market, where massive layoffs are having a devastating effect on consumer confidence. At this point it will take definitive government action to stop the slide in home values and turn the tide of consumer sentiment. Expanding the first-time buyer tax credit and providing government action to reduce mortgage rates would go a long way toward arresting this downward spiral, just as a combination of similar moves worked in the 1970s to boost the housing market and economy.”
Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.
Two out of three of the HMI’s component indexes registered some further deterioration in December. The index gauging current sales conditions and the index gauging sales expectations for the next six months each declined to new record lows, falling one point to 8 and two points to 16, respectively. The index gauging traffic of prospective buyers held at a record low of 7 for the month.
Two out of four regions posted declining builder confidence readings in December, with the Midwest and South edging down one point and two points, to 6 and 10, respectively. The Northeast held even with the previous month’s 11 reading, while the West posted a one-point gain to 7.
Mortgage Applications Increase, Driven by Refinances in Latest MBA Weekly Survey
WASHINGTON, D.C. (December 17, 2008) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending December 12, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 841.4, an increase of 2.9 percent on a seasonally adjusted basis from 817.7 one week earlier, which was revised from 796.8.* On an unadjusted basis, the Index increased 2.9 percent compared with the previous week and was up 37.3 percent compared with the same week one year earlier.
The Refinance Index increased 6.5 percent to 4156.0 from the previous week and the seasonally adjusted Purchase Index decreased 4.5 percent to 286.1 from one week earlier. The Conventional Purchase Index decreased 6.7 percent while the Government Purchase Index (largely FHA) was virtually unchanged.
The four week moving average for the seasonally adjusted Market Index is up 17.9 percent. The four week moving average is up 3.2 percent for the seasonally adjusted Purchase Index, while this average is up 28.1 percent for the Refinance Index.
The refinance share of mortgage activity increased to 76.9 percent of total applications from 74.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 1.1 percent of total applications from the previous week.
30-YEAR FIXED RATE FALLS TO AT LEAST A 37-YEAR LOW
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®): “Interest rates for 30-year fixed-rate mortgage rates fell for the seventh consecutive week, moving these rates to the lowest since the survey began in April 1971,” said Frank Nothaft, Freddie Mac vice president and chief economist. “The decline was supported by the Federal Reserve announcement on December 16th, when it cut the federal funds target to a record low and stated it stood ready to expand its purchases of mortgage-related assets as conditions warrant.”
With home prices falling in many parts of the country, sales slower than normal in other parts and mortgage standards higher than any time since the late ’80s, buyers and sellers can both benefit from creative financing – owner finance, lease options, lesser known grant and loan programs, and more. Buyers stand to benefit by taking advantage of bargains in the market that may be gone when mortgage markets start functioning better and federal money starts inflating home prices again. Sellers who offer creative financing in this market will really stand out to buyers who need to purchase and are cut off by a bad mortgage market; trying to sell in this market means going all out with your marketing and creative financing can be a part of that.
Both buyers and sellers need two things:
Agents experienced with creative finance. This almost always means agents with experience before 2001 when the “subprime” loan market made much creative financing obsolete – for a few years.
Good information.
Over the next few weeks I’ll be updating this site to provide these two things. I’m reposting here my old “Low Down and No Down Real Estate!” guide updated with current information. I’m inviting real estate agents with creative financing experience to contact me for inclusion in a referral database and buyers to contact me for referral to an agent near you. Finally, I’ll be linking to the best literature available elsewhere on the topic to help with the details of your transactions.
This week brought more muddled news for the housing market. Both Freddie Mac and the Mortgage Bankers Association reported drops in Fixed Rate Mortgage (FRM) rates and increases in Adjustable Rate Mortgage (ARM) rates this week. Last Friday, the Mortgage Bankers Assocation reported mortgage delinquency rates at an all time high, two days after reporting an all time increase in mortgage applications; this week, the MBA reported a small drop in mortgage applications. The National Assocation of Realtors reported a small monthly drop in the Pending Home Sales Index on Tuesday, but the previous month’s index was revised upward and the index came in well above Wall Street economist’s expectations.
NAR chief economist Lawrence Yun noted that the index has remained fairly stable for the last year, spiking upward when mortgage rates improved in August:
We did see a spike in August when mortgage conditions temporarily improved, which underscores two things – there is a pent-up demand, and access to safe, affordable mortgages will bring more buyers into the market
* Points reported by Mortgage Bankers Association in this survey include origination fees as well as traditional discount points. Average rates are based on an 80% LTV loan. This means a loan amount no more than 80% of the property value as determined by the lower of the purchase price or appraised value. Typically this means a 20% down payment, though an 80% loan can also be achieved with a second mortgage carried by the seller or a third party lender for the difference between the actual down payment and 20%.
WASHINGTON, D.C. (December 10, 2008) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending December 5, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 796.8, a decrease of 7.1 percent on a seasonally adjusted basis from 857.7 one week earlier. On an unadjusted basis, the Index increased 32.7 percent compared with the previous week and was up 2.2 percent compared with the same week one year earlier. Most categories of the survey declined from the previous week’s results, which were adjusted to account for the shortened week due to the Thanksgiving holiday.
The Refinance Index decreased 0.9 percent to 3767.3 the previous week and the seasonally adjusted Purchase Index decreased 17.4 percent to 298.1 from one week earlier. The Conventional Purchase Index decreased 15.5 percent while the Government Purchase Index (largely FHA) decreased 21.3 percent.
The four week moving average for the seasonally adjusted Market Index is up 17.8 percent. The four week moving average is up 1.2 percent for the seasonally adjusted Purchase Index, while this average is up 33.2 percent for the Refinance Index.
The refinance share of mortgage activity increased to 73.7 percent of total applications from 69.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 1.1 percent from 1.4 percent of total applications from the previous week.
EMPLOYMENT REPORT ALLOWS BOND YIELDS TO FALL
Long-Term Rates Follow As Short-Term Rates Rise
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®)…
“Following the release of the November employment report, which showed the largest monthly decline in jobs since December 1974, bond yields fell slightly this week allowing fixed-rate mortgage rates room to ease back a little further,” said Frank Nothaft, Freddie Mac vice president and chief economist.
“The housing market still hangs in the balance, however,” continued Nothaft. “On a year-over-year basis, after rising in both August and September, pending existing home sales fell 1.0 percent in October, based on figures from the National Association of Realtors®. Meanwhile, conventional mortgage applications for home purchases over the week ending December 5th were up 2.0 percent from four weeks prior, but were still 51 percent below the same period last year, according to the Mortgage Bankers Association.”
WASHINGTON, D.C. (December 5, 2008) — The delinquency rate for mortgage loans on one-to-four-unit residential properties stood at 6.99 percent of all loans outstanding at the end of the third quarter of 2008, up 58 basis points from the second quarter of 2008, and up 140 basis points from one year ago on a seasonally adjusted basis, according to the Mortgage Bankers Association’s (MBA) National Delinquency Survey.
Top Line Results
The delinquency rate includes loans that are at least one payment past due but does not include loans somewhere in the process of foreclosure. The percentage of loans in the foreclosure process at the end of the third quarter was 2.97 percent, an increase of 22 basis points from the second quarter of 2008 and 128 basis points from one year ago. The percentage of loans in the process of foreclosure set a new record this quarter.
The percentage of loans on which foreclosure actions were started during the third quarter was 1.07 percent, down one basis point from last quarter and up 29 basis points from one year ago on a non-seasonally adjusted basis.
The seasonally adjusted total delinquency rate continues to be the highest recorded in the MBA survey. The increase in the overall delinquency rate was driven by increases in the number of loans 90 or more days past due, primarily in California and Florida. The 30 day delinquency percentage remains below levels seen as recently as 2002.
The foreclosure starts rate differed greatly by loan type. For prime loans, foreclosure starts on fixed rate loans were 0.34 percent, unchanged from last quarter, while prime ARM foreclosure starts fell five basis points to 1.77 percent. For subprime loans, fixed rate foreclosure starts increased 16 basis points to 2.23 percent and subprime ARM foreclosure starts decreased 16 basis points to 6.47 percent. FHA foreclosure starts were unchanged at 0.95 percent and VA foreclosure starts increased two basis points to 0.59 percent, all on a non-seasonally adjusted basis.
Nine states had rates of foreclosure starts that were above the national average: Nevada, Florida, Arizona, California, Michigan, Rhode Island, Illinois, Indiana, and Ohio. The remaining 41 states plus the District of Columbia were below the national average.
Job Losses to Drive Mortgage Delinquencies
Jay Brinkmann, MBA’s Chief Economist and Senior Vice President for Research and Economics said, “An initial look at the number of foreclosure starts would seem to indicate at least a leveling off of foreclosures. These numbers, however, are being influenced by several factors including various moratoria on foreclosure filings and by mortgage companies holding loans in the 90+ day bucket during the modification and workout process. Evidence of this can be seen in the large increase in loans 90 days or more past due but not yet in foreclosure. This rate jumped by 45 basis points, the highest increase in this category ever recorded in the MBA survey and far above the average 4 basis point jump we would expect to see. While 20 states showed declines in the rate of foreclosure starts between the second and third quarters, every state showed an increase in the 90 days or more delinquent category with the exception of Alaska and all of the increases were greater than what we would expect due to normal seasonal factors.”
“As for what is driving the national numbers, it is still a case of product and location. Prime and subprime ARMs continue to have the highest share of foreclosures and California and Florida have about 54 percent and 41 percent of the prime and subprime ARM foreclosure starts respectively. Until those two markets turn around, they will continue to drive the national numbers,” continued Brinkmann.
“While much of the mortgage problem in some states continues to be overbuilding, poor underwriting and incorrect credit pricing, fundamental economic factors are becoming more important. The 30-day delinquency rate is still lower than it was in the 2001 recession, but job losses are mounting. We have not gone into past recessions with the housing market as weak as it is now so it is likely that a much higher percentage of delinquencies caused by job losses will go to foreclosure than we have seen in the past.
“Until recently, it was job and population losses that were the problems in states like Michigan and Ohio, whereas the problems in California and Florida were a combination of too many houses, speculation and weak underwriting. Economic fundamentals are now deteriorating in California and Florida. Over the past year, Florida led the nation in job losses at 156,200, with California losing 101,300, as compared with Michigan job losses at 71,200 and Ohio at 17,300.
“In the last quarter we saw about 575,000 foreclosure actions started, compared with an estimated 580,000 in the second quarter and 535,000 in the first quarter. At this rate we are looking at finishing 2008 at about 2.2 million foreclosure actions started. Absent a recession, the 2009 number would likely have fallen by several hundred thousand but the effects of job losses and general economic deterioration make the 2009 outlook worse, particularly if mortgage problems become more widespread,” Brinkmann said.
Change from last quarter (second quarter of 2008)
The seasonally adjusted delinquency rate increased 41 basis points to 4.34 percent for prime loans, increased 136 basis points to 20.03 percent for subprime loans, increased 29 basis points to 12.92 percent for FHA loans, and increased 46 basis points to 7.28 percent for VA loans.
The percent of loans in the foreclosure process increased 16 basis points to 1.58 percent for prime loans, and increased 74 basis points for subprime loans to 12.55 percent. FHA loans saw an eight basis point increase in the foreclosure inventory rate to 2.32 percent, while the foreclosure inventory rate for VA loans increased 13 basis points to 1.46 percent.
The non-seasonally adjusted foreclosure starts rate remained unchanged for prime loans at 0.61 percent and decreased three basis points for subprime loans to 4.23 percent. The rate was unchanged for FHA loans at 0.95 percent and increased two basis points for VA loans to 0.59 percent.
The seriously delinquent rate, the non-seasonally adjusted percentage of loans that are 90 days or more delinquent, or in the process of foreclosure, was up from both last quarter and from last year. This measure is designed to account for inter-company differences on when a loan enters the foreclosure process.
Compared with last quarter, the seriously delinquent rate increased for all loan types. The rate increased 52 basis points for prime loans to 2.87 percent, increased 171 basis points for subprime loans to 19.56 percent, increased 62 basis points for FHA loans to 6.05 percent, and increased 45 basis points for VA loans percent to 3.45 percent.
Change from last year (third quarter of 2007)
On a year-over-year basis, the seasonally adjusted delinquency rate increased for all loan types, except FHA loans. The delinquency rate increased 122 basis points for prime loans, increased 372 basis points for subprime loans, and increased 70 basis points for VA loans. The seasonally adjusted delinquency rate was unchanged for FHA loans on a year over year basis.
The percent of loans in the foreclosure process increased 79 basis points for prime loans and 566 basis points for subprime loans. The rate increased 10 basis points for FHA loans and 43 basis points for VA loans.
The non-seasonally adjusted foreclosure starts rate increased 29 basis points overall, 25 basis points for prime loans, 105 basis points for subprime loans, one basis point for FHA loans, and 20 basis points for VA loans.
The seriously delinquent rate was 156 basis points higher for prime loans and 818 basis points higher for subprime loans. The rate also increased 51 basis points for FHA loans and 89 basis points for VA loans.
The housing news this week has been a mixed bag, with good news on interest rates and a decline in new housing starts offset by a drop in new mortgage applications and with Freddie Mac and Fannie Mae following the lead of Citigroup, JP Morgan Chase and Bank of America in announcing a foreclosure freeze.
Thursday Freddie Mac and Fannie Mae followed the lead of many large private lenders and announced a 6-week moratorium on foreclosures and evictions of occupied homes, which will provide some temporary relief to the fire sale mentality in some districts. The move is practical as well as humanitarian as it will provide an opportunity for some of these homeowners to qualify for housing bailout refinance loans and for the lender’s workout departments to help avert some foreclosures in other ways. For more information about workout options and avoiding foreclosure see this page.
The Mortgage Bankers Association reported Fixed Rate Mortgage (FRM) rates down and 1-year Adjustable Rate Mortgage (ARM) rates up for the week ending November 14 and Freddie Mac reported rates down across the board for the week ending November 20. The Mortgage Bankers Association also reported a 12.6% drop in new applications for home purchase mortgages. Refinance applications rose 2.6%.
Housing starts fell last month as builder sentiment hit another record low with Wells Fargo/National Association of Homebuilders reporting its Housing Market Index at 9. The index of sales expectations held steady.
Freddie Mac attributed the drop in interest rates to continued signs of economic weakness, which reduce bond market inflation fears, and noted that:
the Federal Reserve during its October 28-29 committee meeting lowered its economic growth forecasts for 2008 and 2009, according to its minutes released this week.
Possibly one of the best signs for the mortgage market and, eventually by extension, the housing market has been the recent narrowing of the gap between the Freddie Mac conforming 1-year ARMs and the Mortgage Bankers Association’s 1-year ARM average, which includes jumbos and other non-conforming mortgages. The MBAA rate had been reported above 7% even as the longer term rates were under 6%. Though the rate is still higher than the long term rates, there’s been a significant drop that indicates some improvement in the market for these loans.
Mortgage Bankers Association Average Mortgage Rates At a Glance
* Points reported by Mortgage Bankers Association in this survey include origination fees as well as traditional discount points. Average rates are based on an 80% LTV loan. This means a loan amount no more than 80% of the property value as determined by the lower of the purchase price or appraised value. Typically this means a 20% down payment, though an 80% loan can also be achieved with a second mortgage carried by the seller or a third party lender for the difference between the actual down payment and 20%.
LONG-TERM MORTGAGE RATES DOWN FOR THIRD CONSECUTIVE WEEK
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 6.04 percent with an average 0.7 point for the week ending November 20, 2008, down from last week when it averaged 6.14 percent. Last year at this time, the 30-year FRM averaged 6.20 percent.
The 15-year FRM this week averaged 5.73 percent with an average 0.7 point, down from last week when it averaged 5.81 percent. A year ago at this time, the 15-year FRM averaged 5.83 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.87 percent this week, with an average 0.6 point, down from last week when it averaged 5.98 percent. A year ago, the 5-year ARM averaged 5.88 percent.
One-year Treasury-indexed ARMs averaged 5.29 percent this week with an average 0.5 point, down from last week when it averaged 5.33 percent. At this time last year, the 1-year ARM averaged 5.42 percent.
(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)
“Long- and short-term mortgage rates fell for the third consecutive week amid continuing signs of a slowing economy,” said Frank Nothaft, Freddie Mac vice president and chief economist. “Retail sales fell for the fourth straight month in October and consumer sentiment remained near a 28-year low in November.
“In fact, the Federal Reserve during its October 28-29 committee meeting lowered its economic growth forecasts for 2008 and 2009, according to its minutes released this week.”
FREDDIE MAC SUSPENDS ALL FORECLOSURE SALES OF OCCUPIED HOMES FROM DAY BEFORE THANKSGIVING UNTIL JANUARY 9, 2009
McLean, VA – Freddie Mac (NYSE: FRE) today announced it has ordered its national network of mortgage servicers and foreclosure attorneys to suspend all foreclosure sales and evictions involving occupied single family and 2-4 unit properties with Freddie Mac-owned mortgages between November 26, 2008 and January 9, 2009. The suspension will help servicers implement the Streamlined Modification Program recently announced by Freddie Mac, Fannie Mae, the Federal Housing Finance Agency (FHFA), HOPE Now and 27 mortgage servicers. The temporary suspension is also expected to give servicers more time to help borrowers avoid foreclosure.
Specifically, Freddie Mac servicers and foreclosure attorneys were told to contact as quickly as possible an estimated 6,000 borrowers with foreclosure sales scheduled between November 26, 2008 and January 9, 2009. If the property is occupied, the servicers and foreclosure attorneys will halt the sale. This temporary suspension of foreclosure sales will not apply to vacant single family properties. Additionally, no evictions will be completed between November 26 and January 9.
“By working closely with FHFA and our servicers, Freddie Mac is on track to help three out of every five troubled borrowers with Freddie Mac-owned loans avoid foreclosure this year,” said Freddie Mac Chief Executive Officer David M. Moffett. “Today’s announcement builds on this momentum and provides a new measure of certainty to many of these families during the holidays.”
Moffett said that by delaying these foreclosure sales, the nation’s servicers will have the opportunity to work with more borrowers who could qualify for a modification under the new Streamlined Modification program scheduled to begin by December 15.
“Today’s announcement has the potential to enable more families struggling in these extraordinary times to take advantage of this vital new initiative developed with FHFA, the Treasury Department and the mortgage finance industry,” said Moffett.
Moffett also emphasized that lenders servicing Freddie Mac-owned mortgages will continue to work with borrowers to consider all workout options Freddie Mac employs to help distressed borrowers who can and want to stay in their homes, such as permanent rate reductions and mortgage term extension modifications.
This year, Freddie Mac expects to approve 84,000 workouts for the estimated 140,000 who are delinquent on Freddie Mac-owned mortgages.
Freddie Mac’s temporary suspension of foreclosure sales is the latest in a series of efforts to help troubled borrowers. Other recent initiatives have included, delegating expanded workout authority to servicers, doubling the amount of money servicers are paid for successful workouts, and paying non-profit organizations to reach out to worried borrowers.
Builder Confidence Plummets; Congress Needs To Act
November 18, 2008 – Builder confidence in the market for newly built single-family homes plunged in November as worsening problems in the financial markets, job market weakness and overwhelming uncertainty about the economy continued to negatively impact consumer behavior, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The HMI sank five points to 9, the lowest level recorded since the series was created in January of 1985.
“Today’s report shows that we are in a crisis situation. If there’s any hope of turning this economy around, Congress and the Administration need to focus on stabilizing housing,” said NAHB Chairman Sandy Dunn, a home builder from Point Pleasant, W.Va.. “Tremendous economic uncertainties have driven consumers from the housing market, and it’s going to take some major incentives to bring them back. Beyond the work that is being done to help reduce foreclosures, Congress must immediately incorporate such incentives for qualified buyers in a new economic recovery package.”
“The housing downturn has already cost America three million jobs in construction and related industries, and this downward momentum cannot be stemmed without substantive government intervention,” agreed NAHB’s new Chief Economist, David Crowe. “Congress should consider significant consumer incentives such as expanding the first-time home buyer tax credit and providing a government buy-down of mortgage interest rates for home purchasers. Both policies were successfully combined in the ‘70s to stimulate home buyer demand, and could get housing and the national economy moving again.”
Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.
Two out of three of the HMI’s component indexes declined in November. The index gauging current sales conditions fell six points to 8, which was a new record low. Likewise, the index gauging traffic of prospective buyers fell four points to 7 – also a record low. Meanwhile, the index gauging sales expectations in the next six months held firm from the previous month at its record low of 19.
Every region posted declines in builder confidence in November. The Northeast, South and West each registered five-point declines to 11, 11 and 6, respectively, while the Midwest registered a six-point decline to 7.
Mortgage Applications Decrease in Latest MBA Weekly Survey
WASHINGTON, D.C. (November 19, 2008) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 14, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 398.6, a decrease of 6.2 percent on a seasonally adjusted basis from 425.0 one week earlier. On an unadjusted basis, the Index decreased 7.2 percent compared with the previous week and was down 41.3 percent compared with the same week one year earlier.
The Refinance Index increased 2.6 percent to 1281.2 from the previous week and the seasonally adjusted Purchase Index decreased 12.6 percent to 248.5 from one week earlier. The Conventional Purchase Index decreased 15.3 percent while the Government Purchase Index (largely FHA) decreased 6.5 percent.
The four week moving average for the seasonally adjusted Purchase Index is down 2.7 percent, while this average is up 2.5 percent for the Refinance Index.
The refinance share of mortgage activity increased to 49.9 percent of total applications from 45.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 2.6 percent from 2.3 percent of total applications from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.16 percent from 6.24 percent, with points increasing to 1.24 from 1.17 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.87 percent from 5.90 percent, with points increasing to 1.24 from 1.12 (including the origination fee) for 80 percent LTV loans.
The average contract interest rate for one-year ARMs increased to 6.80 percent from 6.77 percent, with points increasing to 0.63 from 0.43 (including the origination fee) for 80 percent LTV loans.
Fannie Mae To Suspend Foreclosures Until January 2009 While Streamlined Modification Program is Implemented
WASHINGTON, DC — In order to support the streamlined modification program announced on November 11, 2008, Fannie Mae (NYSE:FNM) today issued a notice to its loan servicing organizations and retained foreclosure attorneys directing them to suspend foreclosure sales on occupied single-family properties as well as the completion of evictions from occupied single-family properties scheduled to occur from November 26, 2008 until January 9, 2009.
The temporary suspension of foreclosures is designed to allow affected borrowers facing foreclosure to retain their homes while Fannie Mae works with mortgage servicers to implement the streamlined modification program scheduled to launch December 15. Foreclosure attorneys and loan servicers will be instructed to use the additional time to reach out to borrowers who have defaulted on their loans and continue to pursue workout options. The initiative applies to loans owned or securitized by Fannie Mae.
The streamlined modification program is aimed at the highest risk borrower who has missed three payments or more, owns and occupies the primary residence, and has not filed for bankruptcy. The program creates a fast-track method for getting troubled borrowers into an affordable monthly payment through a mix of reducing the mortgage interest rate, extending the life of the loan or even deferring payments on part of the principal. Servicers have flexibility in the approach, but the objective is to create a more affordable payment for borrowers at risk of foreclosure.
“The streamlined modification program by Fannie Mae, Freddie Mac, Hope Now and 27 mortgage servicers is an important step forward in addressing the systemic issues driving the increase in foreclosures,” said Fannie Mae President and Chief Executive Officer Herb Allison. “Until the streamlined modification program is fully implemented, we felt it was in the best interest of both borrowers and Fannie Mae to take this extra step to ensure that homeowners with the desire and ability to prevent a foreclosure have an opportunity to stay in their homes. We encourage other servicers of non-GSE mortgages to participate in the streamlined modification program to bolster our collective efforts to stem the foreclosure crisis.”
Fannie Mae will be working with foreclosure attorneys and servicers to reach out to the more than 10,000 borrowers the company estimates would be affected during this period. Borrowers who have Fannie Mae loans that are scheduled for foreclosure between November 26, 2008 and January 9, 2009, will be contacted directly by the attorney handling the foreclosure. If the home is occupied, Fannie Mae has instructed servicers and attorneys to suspend the foreclosure.
Allison also said Fannie Mae’s loan servicers are prepared to work with borrowers during this period, even if previous workout efforts have been unsuccessful. As part of the company’s “Second Look” initiative, Fannie Mae personnel have been reviewing seriously delinquent loans to determine if the borrower has been contacted and all workout options have been exhausted.
The streamlined modification program and temporary suspension of foreclosures are two of a series of steps Fannie Mae has taken to expand its foreclosure prevention efforts, which are designed to give loan servicers and foreclosure attorneys tools to find the best solution for a borrower in financial trouble. Fannie Mae and its many partners in the housing industry urge borrowers in financial difficulty to reach out to their loan servicers, regardless of whether they are facing imminent foreclosure. Solutions may be available that could make an existing mortgage more affordable.
“Fannie Mae is committed to working with FHFA to implement the streamlined modification program as quickly as possible to help prevent unnecessary foreclosures,” Allison said. “We must and will do more.”
Both the Mortgage Bankers Association and Freddie Mac reported a drop in Fixed Rate Mortgage (FRM) rates in their latest surveys, with Freddie Mac reporting an increase in 1-year Adjustable Rate Mortgage (ARM) rates and the Mortgage Bankers Association reporting a drop. The Mortgage Bankers Association also reported that new mortgage applications rose last week, 9% for purchases and 16% for refinances.
Freddie Mac’s chief economist attributed the drop in rates to signs that the overall economy is weakening and noted that
the actions of the Fed in recent weeks to assist commercial paper markets appear to be thawing part of the credit freeze that has gripped capital markets in the U.S., giving banks some breathing room. This is the second week that rates have come down for fixed-rate mortgages
Average Mortgage Rates from the Mortgage Bankers Association
* Points reported by Mortgage Bankers Association in this survey include origination fees as well as traditional discount points. Average rates are based on an 80% LTV loan. This means a loan amount no more than 80% of the property value as determined by the lower of the purchase price or appraised value. Typically this means a 20% down payment, though an 80% loan can also be achieved with a second mortgage carried by the seller or a third party lender for the difference between the actual down payment and 20%.
Mortgage Applications Increase In Latest MBA Weekly Survey
WASHINGTON, D.C. (November 13, 2008) — The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending November 7, 2008. The Market Composite Index, a measure of mortgage loan application volume, was 425.0, an increase of 11.9 percent on a seasonally adjusted basis from 379.9 one week earlier. On an unadjusted basis, the Index increased 10.5 percent compared with the previous week and was down 40.0 percent compared with the same week one year earlier.
The Refinance Index increased 16.1 percent to 1248.4 from the previous week and the seasonally adjusted Purchase Index increased 9.0 percent to 284.4 from one week earlier. The Conventional Purchase Index increased 6.5 percent while the Government Purchase Index (largely FHA) increased 15.3 percent.
The four week moving average for the seasonally adjusted Market Index is down 3.7 percent. The four week moving average for the seasonally adjusted Purchase Index is down 2.5 percent, while this average is down 5.1 percent for the Refinance Index.
The refinance share of mortgage activity increased to 45.1 percent of total applications from 42.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 2.3 percent from 2.5 percent of total applications from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.24 percent from 6.47 percent, with points decreasing to 1.17 from 1.19 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 5.90 percent from 6.14 percent, with points decreasing to 1.12 from 1.22 (including the origination fee) for 80 percent LTV loans.
The average contract interest rate for one-year ARMs decreased to 6.77 percent from 6.86 percent, with points increasing to 0.43 from 0.42 (including the origination fee) for 80 percent LTV loans.
MORTGAGE RATES DOWN FOR SECOND WEEK RUNNING
McLean, VA – Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 6.14 percent with an average 0.7 point for the week ending November 13, 2008, down from last week when it averaged 6.20 percent. Last year at this time, the 30-year FRM averaged 6.24 percent.
The 15-year FRM this week averaged 5.81 percent with an average 0.7 point, down from last week when it averaged 5.88 percent. A year ago at this time, the 15-year FRM averaged 5.88 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.98 percent this week, with an average 0.6 point, down from last week when it averaged 6.19 percent. A year ago, the 5-year ARM averaged 5.96 percent.
One-year Treasury-indexed ARMs averaged 5.33 percent this week with an average 0.5 point, up from last week when it averaged 5.25 percent. At this time last year, the 1-year ARM averaged 5.50 percent.
(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)
“Long-term mortgage rates fell slightly this week as signs the overall economy is weakening brought interest rates down market-wide,” said Frank Nothaft, Freddie Mac vice president and chief economist. “In addition, the actions of the Fed in recent weeks to assist commercial paper markets appear to be thawing part of the credit freeze that has gripped capital markets in the U.S., giving banks some breathing room. This is the second week that rates have come down for fixed-rate mortgages.
“Mortgage applications for home purchase loans fell during the final week in October to the slowest pace since the week of December 29, 2000, based on figures published by the Mortgage Bankers association. Meanwhile, the National Association of Realtors® (NAR) reported that pending existing home sales fell 4.6 percent in September, below the market consensus; however, the index was 1.6 percent above that of the same period last year.”
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
Used GoGoPin's new browser-based ad designer to create this call for nominations for "Best of Breed" money-saving applications for home buyers and sellers following the National Association of Realtors convention in Orlando, November 7-10, 2008. Watch this one minute screencast for more information on the proposed technology debriefing. Should we meet in person in Boston, like real estate round tables and technology debriefing hosted in the past by The Real Estate Cafe, or online so anyone can participate?
If you attended the NAR convention and spent time visiting some or all of the 500+ vendors in the EXPO, we'd love to receive your nomination for "Best of Breed" money-saving tools for home buyers and sellers.
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
Home buyers, sellers, and fellow real estate innovators: Wish you could attend the National Association of Realtors convention in Orlando this weekend but can't? Interested in participating virtually?
I arrive Friday mid-afternoon and plan to spend all four days visiting 500+ vendors at the Realtor Expo to identify "best of breed" money saving opportunities for home buyers and sellers. Last July, I acted as the LIVE BLOGGER at Inman New's ConnectSF08 and am willing to provide private market research reports LIVE from the floor of the exhibit hall for a few select clients.
As in the past, I can provide feedback by phone, email, text. This weekend, I hope to experiment with video, live or recorded, as well as screen sharing and video conference calls.
Fees begin at just $25 – $50 per vendor you'd like me to investigate depending on the research question and how you'd like the results presented. That modest fee would cover 15 to 30 minutes, additional time is negotiable.
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
Having already posted one comment to WBUR's heated discussion about "what caused the housing crisis and how to fix it," I was content to watch the debate unfold yesterday until several posts began spreading misinformation about the role of buyer agents and whether they help clients save money.
First, there is some truth that the current two-sided real estate commission does not align buyer agent compensation with performance. That's why some in the industry offer rebates and others are calling for commissions to be divorced. If that single reform comes out of this crisis, conflicts of interest would be reduced, competitive options would increase, and consumers would save billions of dollars as argued in these blog posts written two to three years ago:
At least one other buyer agent in Chicago has helped clients save more than $1 million during a twelve month period and there are probably others. More importantly, new referral sites like http://www.ProOffer.com and conversations like this could bring performance based compensation into the real estate industry. My guess is that millions of real estate consumers, both home buyers and sellers, would agree that reform is long overdue!
What's your opinion? Do buyer agents really help consumers save money?
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
WBUR / NPR OnPointRadio: Banks and Housing in Crisis
American housing and finance. What went wrong, and how to fix it.
You can join the conversation. What new rules should be in place? Should we make it more difficult to buy a home? Should we stop banks from playing with mortgage securities? Should we put up big firewalls on Wall Street to head off future disasters? Tell us what you think.
MY COMMENT TO WBUR BLOG, yours are welcome as well:
"Speed bumps" to protect the housing market from overheating? That's the role of a buyer agent in individual real estate transactions. Unfortunately, over the past 15 years, the real estate lobby pushed state legislatures nationwide to remove speed bumps by legalizing conflicts of interest inherent in "designated agency."
From my day-to-day experience as a buyer agent in Greater Boston, I know there have been countless "bidding wars" over the past decade. Conflicts of interest and manipulative business practices made those bidding wars worse. Now the cost is being passed on to society as this case study demonstrates:
"My so-called buyer's agent (who promptly switched roles at contract signing without explanation), initially advised me to bid $750,000 for my house of choice, which was listed at $699,900. When I told her that such an offer was beyond my price range, she was quite adamant that I not offer anything under the list price. When I finally backed out the deal because of her bait and switch scam, I later heard that the house in question sold shortly afterwards for $682,000—in other words, nearly $70,000 less than the bid suggested by my so-called buyer agent."
"This type of price inflation (caused by seller's agents masquerading as buyer's representatives) must have a very distorting impact on housing costs. The economic fallout is enormous: ordinary citizens are forced to move out farther in search of decent, affordable places to live, which leads to a host of problems connected with traffic congestion, suburban sprawl, etc."
"As I perceive it, the real estate cartel's use of dual agency [a.k.a. "designated agency"], which works to the detriment of the average consumer while enriching dishonest agents through the practice of double-dipping, contributes significantly to the manifold problems we see in the residential housing market and therefore should be fully exposed."
This case study is an example of what's wrong with dual agency / designated agency, and why I believe designated agency laws should be repealed and "blind" bidding wars should be managed with regulatory "speed bumps."
So, if Congress, policy makers, and consumers are asking what factors contributed to the overvaluation of housing markets, shouldn't dual agency and blind bidding wars be included in that investigation? My hope is that others will agree that it's time to expose systemic flaws and conflicts of interest in the residential brokerage practices, and the cost of blind bidding wars, not just to individual buyers but to tax payers.
This three minute audio post proposes four regulatory reforms to protect consumers — buyers, sellers, and tax payers — in the future. Please listen, comment, and / or join us for a TweetUp in Boston to listen to the rebroadcast of this program, 7-8pm in Boston.
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
As the housing market enters the final quarter of 2008, The Real Estate Cafe is contacting new and long-time clients to get an update on their home buying plans. Can you believe that one member of our 1,000 Click Club has viewed 6,247 MLS pages via The Real Estate Cafe’s MLS access system during the past 2.3 years? More than half of those page views (3,847 pages) have been since the start of 2008 and about a third (1,270) were during the 3rd quarter. If you're bargain hunting during the final quarter of 2008 and early 2009, can The Real Estate Cafe help you save money by serving you "a la carte"?
SPECIAL BAILOUT BONUS:
To encourage you to take advantage of falling prices during the current financial crisis, we’re willing to reduce our hourly consulting to just $50 for any work requested before close of business TODAY (offer extended through Wednesday, October 8, 2008 if payment made online by 5pm). That’s a savings of 50-67% off our current billing rate of $100-$150 per hour. So, if there is any work we can do to help you — for example, download & forward MLS listing data so you can analyze price trends — please let us know ASAP. At a minimum, would you like us to add expired listings to your daily email of MLS listings? An amazing, 1,136 single family listings expired across MA last week (9/27-10/3/08) alone; and surprisingly, 498 listings were priced UNDER $319K!
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
If you're unable to join us at the TweetUp tonight at TogetherInMotion, One Broadway in Arlington, text your response to our Wiffiti board so anyone online or at the TweetUp can read your perspective.
Send us an email if you'd like to participate in one of our upcoming Bubble Hours or "Fear of Foreclosure" support groups for anxious homeowners.
Trendsetter Stefan Swanepoel has compiled a list of the Top 100 Women in Real Estate. There are some extraordinary women in the real estate industry and I am honored and amazed see my name in such an awesome lineup. Stefan is paring the list down to a Top 20 list from votes received through Friday morning, Sept. 26, 2008.
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
I've spend the morning deconstructing Realtors are not immune to foreclosure, an amazingly transparent blog post on a leading real estate web site. The author's concluding question -- Why did so many people, including Realtors, buy homes in 2005? -- has been and will continue to be the spring board for innumerable blog posts, talk show interviews, research by economists and parodies on YouTube. But now imagine what the authors of Freakonomics or Saturday Night Live could do with this admission that some real estate agents "helped people buy homes that they could not afford," and then repeated the same mistake themselves.
Personally, I'd love to see investigative reporters dig into the conflicts of interest in the real estate industry and expose how deceptive and manipulative business practices, like dual agency and blind bidding wars, fanned the flames of "irrational exuberance" and, as this highly respected blogger admits, ultimately burned Realtors themselves.
Perhaps industry regulators will create new disclosures to protect consumers and prevent another trillion dollar collapse of the housing market in the future. Were you aware that a Washington think tank estimated a "loss of almost $6 trillion in real housing wealth over the course of the year, an average of $85,000 per homeowner"? Historically, potential home buyers have been advised to ask agents about their sales volume, but now it's wiser to ask prospective buyer agents if any past clients are upside down on their mortgages or involved in foreclosure. What if a such a negative equity or "foreclosure disclosure" were required by law?
There is still time to register here for the remainder of the session. This is the final eight-week series in 2008; the price for No Blogger Left Behind will be $297 starting in January, 2009.
The National Association of Realtors® latest forecast calls for improvement in existing home sales during the fourth quarter of 2008, as buyers start taking advantage of benefits provided in the recently signed Housing and Economic Recovery Act. This forecast is...
-Counter Intelligence: The Real Estate Cafe Weblog » read more ..
A leading group of real estate technology innovators is using a sports metaphor, the "Real Estate Olympics", to launch a compelling, timely competitive for the "Real Estate Pacesetter of 2008."
If you translate those MEGA-trends into an Olympic metaphor, you get a different kind of competition and a different call for "Best of Breed." Just as the Olympics have 302 events, there are hundreds of steps in the home buying and selling process and real estate innovators empowering consumers with money-saving, do-it-yourself tools at EACH STEP in the process.
For more than a decade, The Real Estate Cafe's has maintained a list of "Best of Breed" innovators at each incremental step, and we are eager to share them with our clients and others. Real Estate innovators, if you think you should be on the list, please send us an email:
1. Nominating yourself for the appropriate step in the home buying and selling process, and
2. Explaining how you help do-it-yourself home buyers or sellers save money (or time).
Any nominations we receive before this weekend from innovators, or consumers who rave about them, will be showcased at our first "FSBO Trade Mart," tentatively scheduled this weekend at TogetherInMotion.com, One Broadway, Arlington, MA. Watch Twitter & FriendFeed for more details. [twitter.com] [friendfeed.com]
The American Dream of owning real estate has gone International according to the 2008 National Association of Realtors® Profile of International Home Buying Activity. Low interest rates, a softer dollar with advantageous exchange rates and an abundance of inventory has...
Austin Real Estate Weekly Market Update – August 1, 2008 The median single family home price in AUSTIN for the week of August 1, 2008 was $329,500. The 5448 homes have been on the market for an average of 103...
President Bush signed into law this week The Housing and Economic Recovery Act. This is the most sweeping change to housing reform since the New Deal of 1934. It is designed to assist more Americans invest in home ownership and...
No Blogger Left Behind is an eight-week Blog Coaching Webinar series. Our "Breakout" sessions are open to the public. We are planning a Wordpress Breakout and an ActiveRain Breakout in July. The Wordpress Breakout is a discussion for entrepreneurs and is not exclusive to real estate; the ActiveRain Breakout will be real estate centric.
If you are interested in sharing your Wordpress expertise or your thoughts about ActiveRain as a panelist, please let me know. I will be scheduling the Webinars in the next couple of days. We expect a large turnout for each of these events. E-mail me here.
In my last post, I talked about some major — and very exciting — changes going on at Mortgage Coach and I asked for your feedback. We received a great response, so I want to thank everyone who contributed. I read every comment personally.
I was glad to hear that Mortgage Coach Members want the new focus to be about increasing member value and we’re committed to doing that. The upcoming launch of our new website will feature community tools to help improve your business every day.
• Idea Exchange - a weekly message board for members to interact with each other
• Weekly Coaching Call every Tuesday at 9 a.m. PST
• New Savage Insights Member Blog
• Regular Insight from Leading Industry Experts.
Our non-member readers have expressed their appreciation for the value they get from Savage Insights and would like to continue benefiting from the community education and business growth that a public blog provides. For those reasons, I will continue to offer a new public blog which will include guest bloggers. If you are interested in writing a guest blog post, please email me your idea at dsavage@mortgagecoach.com.
We are planning to keep current blog posts available to all readers for the time being. However, all new case studies and audio/video interviews will be for Mortgage Coach Members only.
This is not the end of something, but rather, the beginning of a new relationship. I’m passionate about helping loan officers make more money, by selling more effectively and improve the quality of their customers’ lives. That has always been our mission and will continue in the future.
As always, I am open to suggestions and ideas, so if you have something you’d like to share, or a success story you’d like to tell, please share your ideas in the comments section of this blog – I really all of them daily.
We are in the process of making our website much more valuable to our Mortgage Coach members and this will require me to change my strategy with my blog www.savageinsights.com.
If you are a reader of my blog, I value your opinion and want to include your feedback in our decision on which direction to go with Savage Insights.
Here are the possible directions we are considering…
We will make Savage Insights a password protected free blog that will require a sign-in.
We will make Savage Insights a Mortgage Coach membership blog that will require you to be an MC member.
I will completely discontinue Savage Insights and focus all my attention on adding value to the Mortgage Coach Community and member-only site.
My most important goal is to provide our members with as much value possible – However I am still committed to educating the industry at the same time. I just need to pick my areas where I invest my time very carefully.
If you have an opinion and/or you value reading Savage Insights, please add your feedback and suggestions in the comments section below.
I will be making this decision at the end of the month and one thing for sure is that the content and direction of Savage Insights will change; the questions is how much.
“Mortgage Coach makes me think.” That’s what Tom Griffith of Eugene, Oregon said at the very beginning of this recorded conversation. When he first sat down with the couple he speaks of here, he wasn’t sure how he was going to help them. But he opened up a Total Cost Analysis report and began filling in the fields. He knew that by sticking with the process he had honed over time, the best solution would appear obvious. And it did.
PROBLEM/SOLUTION:
This client was two years post bankruptcy. The husband had been self-employed for 12 months and had not yet earned any income. Then the unthinkable happened — the wife got laid off. Prior to that fateful day, they had received a large inheritance and decided to send $100,000 to their mortgage lender to pay down their principle, expecting their payments to go down automatically. They did not. They called the bank and requested lower payments. The bank refused. Here they were, highly illiquid, no income, no savings and a mortgage payment they couldn’t afford. They had heard Tom’s radio outreach program and decided to call. They didn’t know it then, but their luck was about to turn.
Due to their current credit situation, they had to do a no doc at 9-1/2% with less than 50% LTV to get the deal done. A 9-1/2% percent interest rate sounds illogical today. But in a side by side comparison with a 6-1/2% loan for someone with good credit, the difference over a three year period — at the time when they would be in a better financial position and could refinance again — was only $9,000, or $3,000 a year, and the lower rate would have only gotten them to their freedom point three quarters of a year earlier. Just 9 months! This information was a revelation. At this point, the conversation was no longer about the rate, but focused on what the loan could help them achieve.
In the end, they were able to take some money out of the house, pay off two car loans and a credit card, and put some of the money they gave away back into their own hands. It was the right transaction for them at the current time.
KEY TAKEAWAYS FROM THIS CALL:
Tom shows you how to uncover a hidden opportunity that most loan officers would have missed;
He explains the right time to fill out a Total Cost Analysis report;
He shows how he easily takes the conversation away from rate and toward the freedom point;
He dollarizes the cost over 36 months to show the benefits; and
He details his best practices for sending out RateWatch.
Tom is doing well in today’s marketplace because of ideas like this. Other loan officers would have said let’s raise the loan amount and increase their liquidity and would have ended up with an unhappy disgruntled client that really didn’t feel good about their loan amount. Tom came up with a program that worked best for his client and then presented it in a way that they could digest it. Thanks to his creativity, Tom now has a new client and a new strategy in his arsenal of successful best practices.
Click on the player below to listen to the conversation with Tom.
The latest S&P/Case-Shiller Home Price Index report is out, and the results are not pretty. The report shows that housing prices dropped in 19 out of 20 metros for the year ended February 2008. Some markets are down as much as 20%.
Now that you’ve read it, forget about it, because, this doesn’t need be negative for you. As I’ve said many times before, loan officers who know how to change and focus on the opportunities aren’t necessarily going to suffer because of this trend. The most successful loan officers have enough business to keep them going and growing for the long term and even in today’s marketplace.
But I know many of you are worried about the short term and you need to act fast. So I’ve pulled together 5 strategies that can help you put out the fires of your day-to-day challenges and grow your business:
Acquire new referral partners and cultivate the ones you have. There’s nothing more important to your business than your referral partners. Focus an hour a day on building referral relationships. Call five financial planners, CPAs or Realtors every day. Set one on one meetings. Hold joint seminars for consumers. Follow up via email with short five-minute videos explaining how you can help them grow their business.
Watch how Linda McKinley emphasizes the value of her services to a financial planner: [www.screencast.com]
Here’s a link to our report The Art of Referrals.
Manage your mortgages. You’ve probably got anywhere from 100 to 1,000 mortgages under management. Somewhere in that database is a goldmine of new business just waiting for you to pull it out. By managing your mortgages on a monthly basis through the RateWatch system, you’ll uncover dozens of hidden opportunities monthly.
Watch Dylan Kramer follow up with a Realtor to explain his Mortgage under Management service: [www.screencast.com]
Distressed homeowners who want to KEEP their homes are a forgotten class. Real estate search giant Trulia is the latest mediatainment player that sees the distressed home market as a pool of buyers and sellers and panders to the hungry investor. Never mind the hundreds of thousands, maybe 2 million, homeowners who would prefer a choice to remain in their homes!
From Trulia press release:
" ... we scoured Trulia Voices to find a panel of foreclosure specialists across the country to provide some advice."
Sadly, there is no advice for homeowners facing foreclosure. The distressed homeowner is the invisible man in terms of real estate industry outreach and support.
This HUD and national Reverse Mortgage Lender offers:
No up front appraisal fee!
30 day closing 30 day closing or less.. GUARANTEED
Tuition rewards for grandchildren Tuition rewards for grandchildren
And of course all the other standard reverse mortgage bells and whistles.
If you have questions or would like to see how much cash you can qualify for please call toll free 1-888-973-8377.
• You may out live your income
• Extra money for prescription drugs
• Replace loss of a second income (deceased spouse)
• Ability to afford home health care instead of a nursing home
• Home improvement money
• No mortgage payments….forever
• Emergency fund
What would you do if you had an extra _____ today?
1) Supplement your income?
2) Buy a new car, truck or motor home?
3) Replace lost income due to death of spouse?
4) Hire a caregiver to avoid a nursing home?
5) Pay off debts?
6) Help your grandchildren?
7) Create a larger estate for your heirs?
You Will Never Lose Your Home
• Title never changes
• Living trust is ok
• Never foreclose
How To Qualify
• Any title holder must be age 62 or older
• Debt to equity ratio must be 50% or less
• Home must be your primary residence for the life of the loan
Buyers are typically need to be sold on a neighborhood before they can be sold on house. If you have a great walkable neighborhood, you might want to flaunt your Walk Score™.
Have you ever thought of generating business through telemarketing? It is an overwhelming task that Eleadspot Streamlines with the BEST state-of-the-art technology platform in the entire industry. If you don't believe us, just call in and check out our demonstration!
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Our lead delivery system is completely controlled through our website. You can schedule your delivery, change your transfer number, and even tell us the amount of simultaneous calls you can take at one time. If you tell us 1 Loan Officer available, we will only send 1 call at a time. All replacements requests are processed within 8 business hours and we will send you another lead while the lead request is in process.
We send a real-time alert with the lead information and third party verification information directly to your computer so that you will have all the details for the borrower before you even speak to them. You have complete control over scripting so that you are prepared and consistent with your pitch on every call.
We have no minimum orders. You can buy leads as you go if you would like. Please contact our friendly sales staff today at (800) 889-6586 or sales@eleadspot.com and we will give you a comprehensive demonstration of our lead system.
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We speak with hundreds of consumers everyday that are seeking mortgage quotes. Live Transfers are the most effective way to speak with the borrower first. Our in-house call center double verifies every live transfer lead for accuracy and interest. If the lead matches your specifications, we'll transfer the call to your phone instantly.
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You assume incorrectly. Since I see you saying you have no clue about HECMs, lets not assume anything about reverse mortgages. I'm not attacking you, just protecting the best practices surrounding the reverse mortgage.
Since reverse mortgages do not have certain credit or doc type requirements, they should not be lumped in with your statement.
There are folks who are house rich but cash poor who turn to a reverse mortgage to meet their monthly financial needs.
There are folks that thought they had plenty of money to retire on that never anticipated the long term health care costs that had to turn to redeeming equity in their home.
There are folks that own second homes with plenty of money in retirement accounts that take equity out of those second homes to invest in businesses or pay for their grand childrens education or to take out annuities- all accomplished using reverse mortgages.
The word "most" should not come to mind when mentioned with reverse mortgages.
It is not entirely clear which of these Reading (PA) houses are on sale. The price - a very reasonable $8k - suggest that it is the burnt out one on the left. However, the photo is centered on the grey one on the right. Moreover, the listing doesn't mention anything about fire damage. The mortgage on this place is just $42 a month. There are some restaurants in DC where a hamburger will cost you more than that.
Few days ago, a burnt out wreck from Baltimore was posted on this site. That property was listed for $120,000. Baltimore is a city I know well. There are some great people living there, but let us be frank; it isn't San Francisco or New York. It is very tough town. I am less familiar with Reading, but it is hard to believe that life there is 14 times worse than Baltimore. However, that is what is implied by the price differential between two cities.
Of course, realtors will shout out that the difference is location. However, inertia is a more likely explanation. It takes time for sufficient numbers of people to migrate from high cost to low cost cities. Nevertheless, it does happen, which suggests that Baltimore is massively overvalued, while Reading might make a better long term real estate investment.
Many thanks to Jay, who told me that I shouldn't mention that Pennsylvannia is a great place to live. Jay was afraid that everyone in California might sell up and move there. Sadly, that is something I cannot do. Pennsylvannia is one of my most favorite places in America. It is time to sell up and move.
Here is a headline that grabs your attention "Cheaper than a car". This craigslist advert from New Orleans is offering a 3 bedroom house for $19k. Moreover, the house only needs a further $5-10k to fix it up. Compared to some million dollar slums in LA, DC and other overpriced bubbletowns, this house looks rather reasonable. So if you are finding it difficult making ends meet in California, sell the SUV, and move south.
Many thanks to "DHSEscort" for this one. If you know of any affordable housing, send it here
Crackhouses, garden sheds and shacks might be amusing, but condo conversions are evil. They are invariably overpriced and threaten to lure naive investors towards financial disaster.
Yesterday, I received an email from ARMMAT, who sent me details of a typical new development in Brentwood California, which is currently on craigslist. Prices range from the mid-400s up to the mid-800s.
The featured apartment is a particularly tasteless and unimaginative conversion. The kitchen has overdosed on granite; there is even some plastered onto the walls. Why have bay windows, when the view is of a wall? The bathroom had some uninspiring wall-to-wall tiling. The ad also goes very heavy on financing options; "We have in house financing and work with first time home buyers. We can get anybody financed."
That last sentence could be an epithet for this bubble. "We can get anybody financed". It doesn't matter the credit history, income levels, or financial IQ of the borrower, there is a financial institution out there ready to write the mortgage check.
ARMMAT took the initiative to send a quick email to the realtor, who goes by the name of Timothy Lo Bello. Here is the exchange, (without edits):
ARMMAT - Regarding your ad for the above property. At $530K and a 6.25% APR, we're looking at around $3270, 30yr fixed loan at best. Plus $552 for p.tax, and another $2-300 for insurance; grand total being around $4-4.1K per month...FOR A CONDO?
The boom is over...adjust the prices...anyone paying that much for a condo where they don't even own the land is an outright idiot. If they fall for such crookery, then they deserve to be stuck in a $4K payment.
Timothy LoBello - I agree. Were 100% sold out. Go and figure? We have 3 new projects on tap and most are pre-sold. enjoy
ARMMAT - Of course you are...I'd be rich for every single time a broker told me that one...Hurry up and buy! You'll miss out!
If in fact it were true, then there are even more idiots out there than I initially thought...I hope they can sustain their mortgages you put them in as their ARMs run out. Perhaps you're fit for American's Overvalued Real Estate Blog....might be worth the exposure.
The realtor says "Go and figure". I have gone and figured, and I reckon that purchasing this condo is financial madness. What I can not understand is why others can't figure it out as well.
Thanks to ARMMAT for the email and the recommendation. Have you had a similar surreal moment with a Realtor recently.
Imagine, just for a moment, living in a 500 sq ft condo just like this one in Boston. It is a a third floor atttic conversion in an unimpressive single family home, in an unremarkable neighborhood. What exactly would be your quality of life?
The center of the room is the only place that you can stand up straight. The kitchen is tiny. The bathroom is so narrow that you won't be able to wash under your arms. You would have nowhere to store your belongings. Moreover, you would be too embarrassed to invite anyone home. Ultimately, the only thing this condo offers is a life of misery.
If you are asking yourself whether you can afford this $145k condo, then you are asking yourself the wrong question. Instead, you should be asking whether it is time to move out of Boston and find a city where you can afford to live. There are plenty of cities in the mid-west where $144k would buy a respectable family home. Salaries may be higher in Boston than the mid-west, but the difference isn't that great. Contrary to what realtors say, it is not about "location, location location". Rather, it is about quality of life. Currently, many bubble cities just can't offer a decent affordable lifestyle for many Americans. Either the market corrects or it is time to move.
Thanks to Sarah for this recommendation. The listing can be found here.
Recently, this blog has been plagued by realtor-types writing comments suggesting that I am way too negative. The blog is also accused of being homeowner-hating, and too pro-renter. In fact, I am a little surprised by the sudden realtor interest in this blog. For a long time, only bitter renters like myself were checking in and having a laugh at America's real estate wrecks. Previously, realtors were out on the streets cutting deals and had no time to be crusing the bubblesphere. Oh, how times have changed.
In response to the realtor onslaught, I will try to mend my ways. I am now going to try to be more positive and balanced about the houses posted on the blog. Here is my first attempt at being nice.
Here we have a beautiful 2 bedroomed single family home from Richmond (CA) listed for a very reasonable $410k. Selling features? Let us consult the great book of realtor cliches and see if anything might fit this property. We have a) handyman special, b) value in the land, c) location, location, location, d) fixer-upper, e) eat-in kitchen, f) beautiful paintwork, and g) fine landscaped garden. So who is ready to buy? What? No one? Why ever not?
Thanks to Joanne for this one. The listing can be found on realtor.com. I think I have a future writing reator write-ups, send me your most despicable wreck and I will try to find something positive about it.
Rather than living by the water, this property will allow you to live on the water. Located on Lake Union, Seattle, this barge is on the market for $187k. With docking fees costing at least $500 a month, don't think that this wreck offers an opportunity to float away from the financial burdens of homeownership. I wonder if you have to pay property taxes on barges?
What is the life expectancy of a barge? Ten years? Twenty at the most? It could well be that this barge will float to the bottom of the lake well before the 30 year mortgage is paid off. An interest only loan would be even more fun. The asset would disappear, leaving the owner with just pure debt and a bank with no collateral to seize in the event of default.
Here is a question for people living off Lake Union. Is the lake a happy habitat for rats? Around DC, those mobile disease-bags love to waterside views just as much as humans. I can't imagine that it is any different over in Seattle. Will this barge act like a rodent-attractor? That sounds real healthy. Overall, a barge would be a great place to bring up kids.
Many thanks to Katie for this one. The listing can be found here.
Does anyone remember "the ballad of Lucy Jordan?" It was an old Dr. Hook song that recounted the life of a housewife, who one day wakes up and realises that she is trapped in the suburbs. The song goes on to explain that since the option of an international jetsetter was no longer available, she decided to climb onto the roof of her suburban hellhole and end it all by jumping off.
Personally, I always imagined that Lucy lived somewhere like this anonymous $1.2 million San Diego box. If Lucy were alive today, she would also have to contend with crippling mortgage payments, as well as the misery of daily life as a domestic drudge.
Many thanks to Ford Prefect for this one. The listing can be found here.
The economic success of America rested on one simple premise; if you worked hard, took risks and made good investment decisions, then you became rich and lived in a big nice house; if you were lazy, risk-averse and made bad decisions, you were poor and you lived in a house like this one here.
The housing bubble has overturned that simple formula. Today, poor people sell 2 bedroomed, 600 sq. ft. shacks, like this one from Newport (CA), to rich folks for $1,150,000. In the process, the underlying incentives to succeed in America are being undermined by massive wealth redistribution from the rich to the poor.
Ultimately, the housing bubble is communism in a modern form. It threatens to turn rich folks into poor people. While the poor may have more cash, they will undoubtedly find ways to spend that money so that they become poor again. Who benefits from this new regime? A narrow elite, known as the realtors. Here is a question open to debate; is the NAR the new Communist Party?
Senator McCarthy once wisely said that "Communism is unamerican". If he were alive today, he would undoubtedly recognise that this housing bubble is also unamerican.
Thanks to Kane for a second excellent recommendation. The listing can be found here. If you see any other communistic unamerican listings, send them here
Why is this housing bubble so depressing? It is what you DONT get for your money. Here is a crappy little wreck from San Mateo. It is on the market for $1.2 million. With that amount of money, you can't get more than four bedrooms, two bathrooms or even buy a decently watered lawn.
Why is this house listed for so much? It must be neighborhood envy "Well, the 6 bedroomed house down the street went for $2 million, therefore my house must be worth at least $1.2 million". There is only one answer to this problem - a buyer's strike. If no one buys any houses, then prices will come down.
So if you are out there looking for a home at the moment, just stop looking. Wait. Things are going to get better. Prices are already falling in many markets. Soon, it will turn into a collapse. In the meantime, sit back, read the overvalued blog and enjoy.
Grateful thanks to John for this one. The listing can be found here.
The realtor describes this Santa Ana (CA) house as being in a "great neighborhood". If so, why are there bars on the windows. Is it to keep people in or to keep them out? Neither option is particularly appealing.
The realtor also tells us that the current owner has found another house and has said "get it sold". The owner has already cut the price twice. It was originally listed at $590k; it is now down to $565k. That smacks of desperation.
However, it isn't all bad. The house has a "bonus room". Yes, there is a bonus with this one and here it is:
Nevertheless, there must be a worry that the current owner has just cleared out the garage, painted the interior and called it a room conversion. The pile of old tires and rubbish does look suspicious. To be fair, the realtor is hedging their bets. The write-up actually describes this room as a garage-bonus room. Ultimately, it will be up to the new owner to decide this question.
The listing can be found here. This wreck was sent in by ocrenter, who contributes to a great blog called bubble tracker. It is well worth a read and a bookmark. Thanks OC. Is there anything similar out there. Of course, I know that the answer is yes. When you see it, let the rest of us know about it.
Don't you just love this house. It is a recreational vehicle converted into a beautiful little cottage. What is more, it is Orange County. A great location for just $200k.
The property is listed on craigslist. However, the owner wasn't giving too much away in terms of amenities. He simply described it as a "great starter home".
However, what would the new owner start when they buy this home? Presumably, it is a life on a trailer park. It is easy to start in such a place; it is desperately difficult to end up somewhere else. Alternatively, the new owner could start being the one in ten American's currently holding negative equity. Buy it for $200k today and within a year, it will be worth $20k. Ultimately, this property offers a lifetime of trailer park living, and being upside-down with a mortgage that you can't afford.
This raises another question. Suppose the future owner did default on the debt, would the bank actually foreclose? A year from now, the foreclosure value of this dog would hardly cover the legal fees.
I found this one myself. Trailer park realtor is always good value for money, at least as far as this blog is concerned.
This unremarkable 3 bedroom house in Falls Church, Virginia is listed on Craigslist for $510k. Like so much property, it is massively overvalued. Nevertheless, it would not merit a posting, were it not for the somewhat unusual incentive offered by the realtor.
The realtor is offering a one week holiday at an RCI resort, provided the sale is completed before June. Before you start digging into you back pocket for your check book, the realtor tagged on those infamous words "terms and conditions apply". It is one of those offers that states that travel is permitted only the 31st of any month beginning with the letter "j", providing it doesn't end with the letter "y".
Before you even think of vacation, sober up with a fifteen minute scan of the bubblemeter. Prices are tumbling in Northern Virginia. The market peaked last summer and for the foreseeable future, it is heading in just one direction.
Here is some free advice. First, don't buy any real estate until you are confident that prices won't tumble. In practice, that could be years away. Second, if you do feel the temptation to buy. Keep the transaction as simple as possible. Avoid incentives. If you want a vacation, find something on the web, and pay for it with your credit card. While it is debatable whether Realtors are good for anything, it is fairly obvious that they don't make good travel agents.
I found this one myself while surfing during office hours. Got to get back to work now. If you see any other daft money losing realtor incentives, send them here.
Many owners think granite countertops is like a real estate steriod. Just install the specky stone into the kitchen and a wreck is transformed from a seven stone weakling into oily skinned 14 stone gym poser. That kind of thinking might have worked a year ago. Today, granite is yesterday’s thing. In 2006, price is the only thing that moves houses.
This house boasts the usual granite tops, stucco and hardwood floors, but so what. Despite the enhancements, the house is ugly, isolated and small. Who wants to spend $695k just to live beside a Toyota dealship called the Toyotathon?
As always, the realtor write-up contains the a couple of mysterious comments. The appraiser thought that this house was worth $750k. Really! So why has the owner dropped the price by $55k? Could the appraiser really be that far out? This raises two difficult but inter-related questions. Do appraisal valuations have any meaningful connection to market prices? Or are appraisals driven by the need to obtain over-inflated mortgages?
The realtor also promises a large 234 sq. ft. unpermitted bonus room. What does that mean? Does the room exist but the authorities don't know about it?
Thanks to Katharina. This one can be found on ziprealty. If there are any other granite enhanced wrecks out there, this blog stands ready to expose them.
This duplex is the our first wreck from an ebay auction. Located in Mt. Washington area of the Hollywood Hills section of Los Angeles, the owner has it listed for $815k. The owner also claims that all serious offers will be considered. Well, I seriously think that this wreck is worth just $500,000. Do you think that the owner will consider that offer? Not at the moment, then just give it some time.
The owners also say that they "are not kidding about that price". They "need to sell" because they are relocating to Connecticut and that "their loss is your gain!" However, the reverse is more likely; if you buy this wreck, your loss will be their gain.
The listing has no fewer than four, seemingly irrelevant, photos of a family dog. There is no suggestion in the advert that the dog thrown in with the house sale. It must be safe to assume that the owner sending the rather unsubtle message that "we are nice people, we love dogs, so please help us out by taking this wreck off our hands". Charity certainly begins at home. However, that charity will start in my home and not in some rancid wreck in L.A currently housing some desperate dog loving wannabe New Englanders.
Changing the subject, does anyone think that the house looks a little lopsided; like it is about to slip into a gorge or down a mountainside? That might explain the sudden desire to move eastwards. LA is certainly a wonderful city, but let us be honest. The ground over there does have the unnerving tendency to move suddenly every now and then.
Thanks to Douglas for this one. It will be listed on ebay for another 8 or so days. However, I am sure that these dogs, both the four legged kind and the one painted blue, will continue to appear on various west coast realtor sites for some time to come. The ebay item number is 4451057464.
I recently posted on Rain City Guide (my favorite real estate blog) about Buying without an agent. The post is pretty informative about the mechanics of actually looking at property listed on your local Multiple Listing Service without hiring an agent (who would otherwise have access to the properties in which you are interested by way of the keybox). The comments (hundreds of 'em!), in turn, raise several other interesting issues.www.lawofficeofcraigblackmon.com
I get many emails and questions about reverse mortgage interest rates.
With a reverse mortgage, you are charged interest only on the proceeds that you receive. Most reverse mortgages charge a variable interest rate (although fixed rate products are entering the marketplace) that is tied to an index, such as the 1-Yr. Treasury Bill or the London Interbank Offered Rate (LIBOR), plus a margin that typically adds an additional one to three percentage points onto the rate you're charged. Interest is not paid out of your available loan proceeds, but instead compounds over the life of the loan until repayment occurs.
The HECM (Home Equity Conversion Mortgage) which happens to currently be the most popular Reverse Mortgage Product is based off the T-Rate. (Tresury Bill rate) plus a margin.
To give you an idea of the interest rate, for the week of July 16, 2007. The interest rate for the HECM was 6.00% (Monthly adjusting with 1.0 Margin) and 6.87 (Annual adjusting with 2.6 Margin).
It is important to understand what your rate will be before moving forward with a Reverse Mortgage. Call 1-888-973-8377 to speak with a Reverse Mortgage Specialist. They will be able to give you an updated interest rate at now charge or obligation. You can also email rates@rtgconsultants.com for current reverse mortgage interest rates.
Well, life takes some funny turns. My pet project, FSBOLawCenter, has turned out to be significantly more complicated than I imagined. Go figure. It turns out that an internet business requires time and effort. I'll take this as my dotcom baptism. Plus, I still get traffic to this page. So, my latest revelation is that I should continue -- er, resume -- posting on this page. I'll be interspersing FSBO issues with posts more related to litigation, whether against another party to the contract or against an agent who failed to perform adequately/appropriately. The more I practice in this field, the more I learn about some fairly shady practices in the real estate business. This blog will be a good place to explore on an occasional basis.
So, to kick things off: did you know that, in this rapidly evolving buyers' market, it is not uncommon for sellers to offer "bonuses" directly to buyers' agents? It's true -- here's a lengthy post on the issue. These bonuses can take many forms, the most odious of which is the "full price offer" bonus. With such a bonus, a seller offers to pay a specific sum (perhaps $1k) directly to a buyer's agent if the agent procures a full priced offer.
What's the problem? Well, the agent has a duty to the client buyer to at least disclose any conflict of interest. In the current market, any particular property may be overpriced (even more likely if they have to offer extra money for a full price offer). In those situations, the buyer's agent presumably does not tell the client the property is overpriced, because the agent directly benefits from a full price offer. Pretty ridiculous -- and something you will avoid if you hire an attorney to draft the offer (although, to be fair, the attorney may be less of an "expert" in regards to valuation to begin with). If you paid full price for your home recently, and if you live in WA, give me a call to figure out whether or not you overpaid to your agent's benefit.www.lawofficeofcraigblackmon.com
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Countrywide Financial Corp. has launched a reverse mortgage aimed at allowing seniors to cash out some of the equity in their homes, marking the largest U.S. home lender's entry into one of the fastest-growing markets targeting baby boomers.
The nation's aging population, along with the rapid housing-price appreciation from 2000 to 2005, has led to record growth in reverse mortgages, which allow homeowners 62 years old and above to turn home equity into income they don't have to repay until they move out.
The reverse mortgage takes its name from the way cash flows between a lender and a borrower. Rather than sending mortgage payments to a bank, as with a traditional mortgage, the borrower receives money in the form of a lump-sum payment, equal payments over time or a line of credit.
The bulk of reverse mortgages funded today are so-called Home Equity Conversion Mortgages, known as HECMs, which are insured by the federal government and cap the amount homeowners can borrow. To cater to people with higher-value homes, lenders increasingly are creating their own products that don't have loan limits. Meanwhile, the increased competition among lenders also is driving down the overall costs for consumers.
Countrywide's proprietary SimpleEquity reverse mortgage program offers lower upfront costs for those who opt for higher initial loan-draw amounts. A typical borrower of the loan has a home valued at $500,000. Specifically, the Calabasas, Calif., lender will waive both the origination fee and closing costs for borrowers who choose to withdraw the entire loan at the closing.
For those who decide to draw 75 percent of the loan amount initially and access the rest over time, Countrywide will waive the origination fee. Industry-wide, lenders typically charge an origination fee of 2 percent or less of a house's value.
Also, Countrywide doesn't charge SimpleEquity borrowers any mortgage insurance premium, which is a common charge on reverse mortgages, as lenders want to assure that borrowers never will owe more than the appraised home value. The insurance premium often accounts for another 2 percent of a home's value.
In addition, with the SimpleEquity program, Countrywide charges each borrower a $20 monthly fee for its efforts to service the loan, lower than the current prevailing range of $30 to $35 a month.
The lender introduced SimpleEquity in California late last year and rolled it out early this year in 46 states. At the same time, it also started to offer HECM loans in those states. The SimpleEquity product now represents a third of its reverse mortgage production.
Steve Boland, managing director for reverse mortgages at Countrywide, called the entry into these products "a very natural progression" for a lender that already ranked first among the nation's traditional home mortgage providers by market share. Ultimately, he said, Countrywide aims to "dominate the reverse mortgage industry."
And the race is on. Attracted by reverse mortgages' growth potential as baby boomers retire, more lenders are entering a niche market traditionally dominated by IndyMac Bancorp Inc.; Wells Fargo & Co.; Seattle Mortgage Co., which is being acquired by Bank of America Corp.; and privately held EverBank's BNY Mortgage Co.
Floyd Robinson, president of Bank of America's consumer real estate division, said the purchase of Seattle Mortgage, coupled with the proprietary reverse mortgage it already has been testing, will "propel us to our target of being the No. 1" reverse mortgage originator by the end of 2008.
In light of the evolving market for reverse mortgages, Bronwyn Belling, a reverse mortgage specialist at the AARP Foundation, which doesn't endorse any lenders, suggests, "Unless you have an urgent need, it may be worth your while to see how the changes in the market affect the products, the pricing and the choices."
Shares of Countrywide fell 95 cents, or 2.3 percent, to $40.13 in early trading Monday.
Reverse Mortgages are gaining more and more steam due to the vast amount of benefits and heavy regulation in the industry.
Despite the various benefits of a reverse mortgage, it is crucial to consider its drawbacks prior to securing one.
When the homeowner dies or permanently moves out of his home, the home will need to be sold in order to pay off the mortgage. The mortgage will be due at this time, in a lump sum. If the homeowner or his inheritors want to keep the home, they would have to make payment on the home within a year of the mortgage becoming due. However, the heir can refinance the home to a loan that better fits their needs and budgets.
There are quite substantial fees involved in a reverse mortgage. This type of mortgage is generally more expensive than a regular mortgage or loan. In the beginning, the homeowner is expected to pay mortgage insurance premium, origination fee, appraisal fee and closing costs. In short, a $200,000 reverse mortgage may have $10,000 worth of fees involved with it. The fees are deducted from the loan prior to the funds being released to the homeowner. There may be additional servicing fees to be incurred during the term of the mortgage.
If the homeowner still holds a mortgage on the home when he seeks out the reverse mortgage, the mortgage will need to be paid off in full with the funds from the reverse mortgage and/or personal funds as needed.
Call 1-888-973-8377 to find out more about reverse mortgages or to request more information.
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You will find Lender411.com listed on the first page of search results with a great position.
Lender411.com also receives significant traffic thru our vast and rapidly-growing affiliate network of mortgage and real estate web sites. In addition, we complement our organic search engine traffic with Pay Per Click campaigns run on the major search engines.
Not all properties qualify for a reverse mortgage. The home must be in good condition; however basic repairs may be completed after closing. Condominiums must meet FHA guidelines and condominium parks for manufactured homes do not qualify. Any manufactured homes must be 1976 or younger, be on an approved permanent foundation and on the owner's property.
The amount of money available is dependent on several factors. These include the age of the youngest borrower, the appraised value or FHA county limit (whichever is less), current program rates and property qualifications.
Additionally, any judgments or liens will be paid at closing if applicable.
A Reverse Mortgage Lender such as ReverseMortgageNation.com can assist you with your reverse mortgage needs.
To speak to a professional instantly, please call tol-free 1-888-973-8377, we would be glad to answer any questions you might have.
Calyx Software helps mortgage brokers and direct lenders increase their profitability by providing reliable and affordable software - connecting loan officers and processors to their customers and to numerous lenders and service providers, using technology that allows all parties to exchange data easily. This seamless interaction increases efficiency and maximizes profitability by enabling more loans to close more quickly.
The Calyx Solution includes these products:
* Calyx Point is the mortgage industry's leading loan marketing, prequalification, origination, and processing software. With its breadth of forms, functions, and flexibility, Point provides a single point from which mortgage-based information is exchanged with a wide array of lenders and service providers.
* Calyx WebCaster makes it easy for you to have an attractive, fully functional web site - without incurring the time and cost of developing one from scratch. Easy to use, affordable (only $24.99 /month with no contracts or setup fees), and fully integrated with Point(r) and Point Data Server, WebCaster creates web sites specifically designed for mortgage professionals.
* Point Data Server helps you share loan file, loan template, and Cardex data quickly and securely on a central server, making Point files accessible from any location - even while you're on the road.
Found this in the local Orlando newspaper this morning when I was enjoying my coffee. A great article about using a quit claim deed for someone on the title of home that is going to get a reverse mortgage. Remember only the homeowner(s) who is over the age of 62 can be on the deed.
Question: I am a 74-year-old widow. About six years ago, I added my daughter's name to my home's title in joint tenancy with right of survivorship so she wouldn't have to worry about probate costs when I pass on. I'm doing pretty well, health-wise, but I am running low on income since my airline pension income was cut about two years ago. However, I am told I can't qualify for a senior-citizen reverse mortgage because my daughter is on the title. Is this true? I asked her to quitclaim her interest back to me, but she is reluctant.
Answer: Since your daughter is obviously not yet 62, her being on the title to your home disqualifies you for a reverse mortgage. All co-owners must be at least 62 because reverse-mortgage eligibility is based on the age of the youngest owner.
Your situation is another example why I do not recommend adding heirs to real estate titles to avoid probate.
However, your problem has an easy solution, which is good for you and your daughter. You can create a revocable living trust with your daughter named as the successor trustee and the heir of your living-trust assets after you pass on.
Before you do this, be sure she agrees and signs a quitclaim deed to you. Then obtain your reverse mortgage. After it is recorded, you can then transfer title to your home into your new living trust, thus avoiding probate after you pass on.
The reason you should wait until after the reverse mortgage is recorded to transfer title into your new living trust is reverse mortgage lenders insist the title not be in a living trust when the reverse mortgage is originated.
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With all the discussion about life settlements, it was time to provide some education. Please call 1-888-973-8377 to speak with a specialist who would be glad to answer any additonal questions.
Here is a glossary of Life Insurance Terms:
-- Accelerated Death Benefit: A policy provision or rider that lets you collect part of your death benefit before you die. If you have a terminal illness, the policy advances you a specified part of your death benefit to pay medical bills or other expenses, then the amount is subtracted from the death benefit your beneficiary receives.
-- Accidental Death: A provision or rider that promises to pay more (usually double) if you die in an accident. Also known as double indemnity.
-- Actuary: A mathematics expert who applies probability theory to the business of life insurance and is responsible for calculating premiums, policy reserves and other values.
-- Administrative Fee: Charges some policies deduct from cash value accumulation each year.
-- Annuity: A contract purchased through an insurance company, usually to accumulate funds that can be used after retirement.
-- Annuitant: A person who receives an income benefit from an annuity.
-- Assignment: Giving rights under the insurance policy to someone else. You can assign beneficiary rights or policy ownership.
-- Automatic Premium Loan: A provision in a policy that authorizes the insurance company to use money from your cash value to pay premiums.
-- Beneficiary: The person you designate to be paid a death benefit when you die. A policy may have one or more beneficiaries.
-- Burial Policy: A policy with a relatively small death benefit, intended to cover your funeral and burial expenses.
-- Cash Value: The savings portion of a life policy. When your premium payments are more than the cost of insurance, the excess goes into a cash value account and draws interest.
-- Certificate: The evidence of coverage received by persons insured through a group life policy.
-- CLU: Charted Life Underwriter. A title that agents and other insurance professionals can achieve after taking a series of classes and passing exams. An agent with CLU after his or her name should know a lot about life insurance.
-- Contestable Period: In Ohio, an insurance company can challenge a life insurance policy during the first two years after issue.
-- Conversion: Changing a term life policy to some other form. This can be done only when the policy is described as convertible.
-- Credit Life: A policy intended to pay off a debt (loan for car, furniture, appliances, etc.) if you die.
-- Death Benefit: The money that a life insurance policy promises to pay your beneficiary when you die.
-- Decreasing Term: A term life policy whose death benefit goes down each year.
-- Dividends: When a company collects more money from policyholders than is needed to cover the cost of insurance.
-- Endowment: A cash value policy that sets a specific time at which the cash value will equal the death benefit. If you buy a $10,000, 20-year endowment policy, you will immediately be insured for $10,000. If you are still living at the end of 20 years, you will receive $10,000 in cash.
-- Face Amount: The sum a policy promises to pay when the insured person dies, or at the maturity of the contract.
-- Family History: Information about medical or mental problems of your parents and other family members. Companies may charge you higher premiums or reject you if your family has a history of cancer, heart attacks, or such diseases as Huntington's.
-- First to Die: Provision in a policy that insures both husband and wife. When the first spouse dies, the survivor collects the full death benefit.
-- Fraud: Any time you knowingly provide false or incomplete information on an application for insurance or on a claim.
-- Free Look: A time after you receive the policy for you to review and consider whether it is what you want.
-- Genetic Testing: Using modern scientific analysis of your blood to determine whether you have any genetic defects that might make it more likely that you would die earlier than the average person. Ohio permits insurance companies to use the results of genetic testing for life insurance policies, but only a few companies require genetic testing.
-- Grace Period: The time after an insurance premium is due during which the premium can still be paid with no interest charged, and coverage remains in force. This period is usually 30 to 31 days.
-- Group Life: A policy issued to an employer, association, or other organization.
-- Guaranteed Issue: A policy that is sold to all applicants without regard to their health.
-- Guaranteed Rate: The only interest amount that the insurance company promises to pay on any cash value in the policy.
-- In Force: A policy is in force when all conditions have been met to establish or maintain the company's obligation to pay if you die.
-- Insurable Interest: In order to be the owner and beneficiary of a life insurance policy, there must be some relationship to the insured person.
-- Lapse: The termination of an insurance policy as a result of failure to pay the premium.
-- Loan: If your policy has accumulated cash value, you may borrow part of it. Interest rates are generally better than bank rates. The amount you borrowed will be deducted from your death benefit until you have repaid it.
-- Mortality Charge: The cost of insuring you at your current age.
-- Nonforfeiture: If you cancel a cash value policy after several years, the company is required to refund part of the cash value.
-- Outlay: The amount you pay the insurance company for insurance (same as premium).
-- Paid-Up: A policy on which all premium payments have been made.
-- Participating Policy: A policy that has the possibility of paying dividends.
-- Policy Owner: The person who contracts with an insurance company for a life insurance policy. The owner of the policy has the right to designate beneficiaries.
-- Preferred Rate: The rate the company charges people who have the lowest risks.
-- Pre-need Contract: A contract with a funeral home that makes it possible to pay your funeral expenses in advance.
-- Reinstatement Period: Restoration of a policy that has lapsed due to non-payment of premium after the grace period has ended. The reinstatement period in life insurance is 3 years from the premium due date.
-- Renewable Term: A term life policy that guarantees you the right to renew at the end of the term.
-- Replacement: An insurance agent replaces your policy when he sells you a policy to take the place of one you already have. Ohio law requires you to sign replacement forms whenever money from one policy is used to buy or fund another policy. If the new policy is with a different company, the agent must notify your old company. The old company then has a chance to persuade you not to switch.
-- Rider: An addition or amendment to an insurance policy.
-- Risk: The likelihood that you will die while insured.
-- Risk Factor: Things about you that affect your risk, such as age, smoking, hazardous occupation, or a family history of heart disease.
-- Settlement Option: How a beneficiary receives payment of the death benefit.
-- Suicide Clause: A life insurance policy will not pay a death benefit if you commit suicide within the first two years after you buy the policy.
-- Surrender Charge: If you surrender an annuity or life policy prematurely, the company may deduct a fee from the amount it owes you.
-- Term Life: The simplest form of life insurance, it generally offers no cash value feature. You pay a premium and the company promises to pay your beneficiary if you die.
-- Underwriting: The insurance company's process for determining whom it will insure.
-- Universal Life: A flexible-premium life insurance contract that accumulates values and pays a death benefit. You choose the policy's premium and face amount, and you can adjust these as long as the policy is in effect.
-- Variable Life: A type of whole life insurance in which the face amount and cash value rely on the investment performance of a special fund. Reserves are placed in investment accounts that are separate from the company's general account.
-- Viatical Settlement: An agreement to sell the ownership of your life insurance policy to another, unrelated person, who becomes both the owner and beneficiary of the policy.
-- Waiver of Premium: A provision that suspends your obligation to pay premiums when you are disabled or you meet some other policy requirement. This is a common feature in life insurance polices.
-- Whole Life: Life insurance with a savings feature. Premiums generally are the same (level) every year. When you are young, your premiums are more than the cost of insuring your life at that time. The excess amount accumulates and resembles a savings account, called cash value. This excess is used by the company to insure you later in life, when your level premium is no longer enough to cover you.
TermLifeFlorida.com offers numerous types of Life Insurance, including:
I made a couple calls and visited with recent clients and seniors who have completed a recent reverse mortgage. I found these other examples online, it is good to share examples so others can see the benefits of a reverse mortgage and how it might work with their specific situation.
Age - 72
Home value - $250,000.
Equity - $210,000. with a mortgage balance of approx. $40,000.
Problem - Mary lives alone and wants to stay in her home but is having difficulty meeting expenses. Her mortgage payment is $611. per month. With her Social Security income and pension she is still short $187. per month.
Solution - A tax free* reverse mortgage for $129,138. Taking a lump sum of $40,000. to pay off her existing mortgage and the balance in monthly payments of $561. After paying off the mortgage, Mary's monthly income rises to $1172. ($611. mtg. paym't plus $561 from the reverse mortgage).
Age - John is 82 and Joanne is 80
Home value - $850,000.
Equity - $850,000.
Problem - Their income is sufficient to live as planned but they would like to assist with the college tuition for their two grand children.
Solution - A reverse mortgage credit line of up to $265,411. Then each grandparent can gift, each year, to each grandchild, the amount currently allowed by law*. Income from a reverse mortgage is currently tax free*.
Call Toll-Free 1-888-9REVERSE (1-888-973-8377) to speak with a Reverse Mortgage Specialist. There is no obligation or cost for our services.
Financial Freedom Cash Account Advantage Plan sometimes refferred to as a Jumbo Reverse Mortgage.
Financial Freedom's proprietary Cash Account Advantage Plan reverse mortgages have been designed especially for senior with substantial home equity or higher-valued homes. No other reverse mortgage lender offers a jumbo loan product comparable to the Cash Account Advantage Plan and its options.
Financial Freedom Cash Account Advantage Plan reverse mortgages have virtually no limit on home value or the amount of the loan. As a result, the amount of money available to the homeowner may be substantially greater with a Cash Account Advantage Plan reverse mortgage than with other options.
Cash Account Advantage Plan features a number of options that allow you to maximize the benefits depending on your unique needs, including eliminating upfront fees and closing costs. Currently there are three available options: the Credit Line Option, the Combo Option, and the Cash Out Option. With all Cash Account Advantage Plan reverse mortgage options, the rate is reset semiannually; there is also a lifetime interest rate cap. A servicing fee is automatically financed on the account each month; there is no such fee in Illinois and Maryland.
In addition, there is no equity or appreciation sharing and no maturity fee.
Available for all Cash Account Options, Equity Choice Feature allows the borrower to limit the loan obligation to a stated percentage of the full market value of the home resulting in the amount of the loan or line of credit being less than the amount for which the borrower otherwise qualifies. Borrowers may choose to protect a minimum of 10% and a maximum of 50% of their home equity. This permits greater flexibility assuring a percentage of equity remaining to benefit the borrower or heirs upon loan maturity.
Call 1-888-973-8377 (1-888-9Reverse) to apply for a Reverse Mortgage Cash Account or to have any questions answered.
Converimax is dedicated to generating Live Transfer Mortgage Leads for loan officers across the United States. With roots in the Canadian mortgage industry we have a refined transfer process that makes us the most proficient lead company on the market.
Situated in the call center capital of North America, the Converimax team utilizes large scale call centers for both U.S lead generation and as"training grounds" for loan officers in Canada. Our U.S. based clientele enjoy the benefits of having leads filtered by Loan Officer Assistants who have a thorough understanding of the mortgage industry.
Converimax has been giving away refinance leads to Broker Outpost members since May of 2006. Please visit our thread in the announcements forum entitled "Converimax's Gift to the Broker Outpost" and receive your free live transfer today.
Would you like to expand your product portfolio with commercial loans, but need some additional training and marketing expertise? InterBay makes it easy, fast and profitable to close small commercial loans.
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Life Settlements are growing rapidly, make sure you understand the process and follow some of the below tips. If you have any questions don't hesitate to call 1-888-973-8377 for a free life settlement consultation.
- Understand how the life settlement process works and when the different phases will happen.
- Decide whether to sell your policy directly to a life settlement provider or go through a life settlement broker who will do the comparison shopping for you.
# If you don’t use a life settlement broker, comparison shop on your own.
- You don’t have to accept any life settlement offer. There is not cost or obligation to receive a life settlement offer.
- Check all life settlement application forms for accuracy, especially information about your medical history.
- Make sure the life settlement provider agrees to put your settlement proceeds in escrow with an independent party or financial institution to make sure your funds are safe during the transfer.
- Find out if you have the right to change your mind about the life settlement offer after you get the proceeds. In many states, you have the right to change your mind for a certain period of time. If you have that right, you’ll have to return the money you were paid and premiums the buyer paid. Check the recession period in your state.
- Understand whether buyers may learn your identity when they buy your policy, and whether they will know certain medical and personal information about you, such as your address and life expectancy.
Life Settlements are a secure and safe transaction, however these tips should help educate you and add additional protection.
877INFOLINE(sm) is a toll-free call capture marketing system designed for real estate, mortgage and other professionals who want to capture leads and easily provide prospects with information 24 hours a day 7 days a week.
We have gone to extraordinary lengths to keep the service simple to manage, easy to use and affordable. Manage all of your Codes (aka boxes or extensions) and Features directly from your computer via the Internet in real time - listen to voice mails, upload recordings and faxes, view reports or modify features.
Plus, our Web Interface will save you money since you are not required to call your toll-free number every time you want to access your account. There are no contracts and no equipment or software required. With instant activation you can have your toll-free number and 877INFOLINE account up and running within minutes.
Want to close more deals, gain more referrals, and most of all CRUSH YOUR COMPETITORS?
pitchSIMPLE is a unique web-based mortgage selling system designed by mortgage professionals for mortgage professionals. It creates customized loan proposals guaranteed to help you sell more loans. Your borrowers click a link and see their loan proposal via e-mail. Or, for face-to-face, faxed and mailed proposals, simply print. Either way, you'll wow your borrowers with your interactive presentation, build trust and rapport, and beat the competition every time. But pitchSIMPLE gives you much more than a loan proposal. If you're a manager or mortgage company owner, pitchSIMPLE will help you retain and recruit the most sought-after originators too.
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These are a few Reverse Mortgage Scams that are going around. These are different than Reverse Mortgage Disadvantages. To find out the Reverse Mortgage Disadvantages and Advantages, please call a Reverse Mortgage Specialist at 1-888-973-8377.
Charging for information that is provided to all people for free.
Beware of estate planning companies that charge for information provided free from HUD. Typically these estate planning companies charge for this information as part of an estate planning program. Seniors that sign up for these programs are unaware that these firms are collecting thousands of dollars by charging a fee of 6 to 10 percent of the total amount borrowed. These fees cost the victims $6,000 to $10,000 on a $100,000 reverse mortgage. HUD has recently issued a directive to lenders that issued reverse mortgages insured by the Federal Housing Administration (FHA) to stop doing business with these companies.
Pushing reverse mortgages as a way to pay for purchases.
Some companies that sell large ticket items or services, like annuities or insurance products, may suggest using a reverse mortgage as a way fund these purchases. Unfortunately, when the additional cost of the reverse mortgage is factored into the purchase, it ends up costing the homeowner much more than the benefit provided by the product or service.
Unethical reverse mortgage terms.
Some lenders include extraneous fees and terms into their contracts, which can have a serious effect on a senior's equity. Some lenders have used shared equity or shared appreciation terms, which gives the lender the right to collect a portion of the appreciation when the home is sold or refinanced. The cost of these provisions can run into the tens of thousands as the home appreciates. These rising cost provisions eat up equity without providing any additional benefit to the homeowner. Read your contracts carefully, and question any fees or terms that you do not understand or expect.
1. More closed loans
2. Less time spent getting to those closed loans.
This is where I can help. I provide mortgage leads that eliminate the primary complaint most loan officers have with buying leads:
* Bogus leads (The prospects were not interested in speaking with a loan officer)
* No answer (You call the number back dozens of times and get no answer)
* Over-sold (The prospect tells you they have already spoken with a dozen other loan officers)
Lead Movers.com addresses these issues with the following solutions. (Aren't you tired of the low quality bogus lead companies anyway?):
* Our telemarketers schedule phone appointments for you
* Our phone leads average a 40% lead to application ratio
* Phone leads are expecting a call from you. No more surprises
* We record every conversation our telemarketers have with prospects (They are held accountable for low quality or bogus leads)
* Leads are delivered same day they are generated
* We offer scripts and training articles to help you make the most of your purchased leads
* You decide what type of leads you prefer. Refi, purchase, loan amount, LTV etc.
The bottom line is that if your goal is to close more loans sooner rather than later, we should talk. I have already demonstrated that I do not participate in high pressure sales tactics. If you call me today at 314-583-5190 I will answer your questions and demonstrate how Lead Movers can put quality prospects on the phone with you quickly.
You now have 3 options:
1. Don't do anything - Keep your business the same as it is
2. Visit my website at [www.leadmovers.com] to gather more information
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My contact information: service@leadmovers.com
Direct line: 314-583-5190
24 hour answer line: 800-936-1180
Quick, tell me the number for your local florist. Can you tell me the number? I'll bet $50.00 bucks you can't. What if you wanted to order flowers and you didn't have a phone book or a computer? You would call 1-800-FLOWERS, right?
And that is what I want to discuss with you today. You see, as mortgage brokers we are all trying to get customers to pick up the phone and call us for their borrowing needs.
The problem with running an ad, doing direct mail, and even word of mouth is that if customers don't remember our phone number, we're sunk. So, how do we get around this little problem? Two words: Vanity numbers!
Imagine if your number was 1-866-HOMELOAN or 1-877-GET-A-LOAN or 1-866-GREAT-RATE? Think of all the places you could put that number. In big letters on your next direct mail piece; on your business cards; in your next radio ad or as the focus on your billboard. Think of how much easier it will be for your past clients to refer you business using your new vanity number. Everywhere you go and everyone you speak with will always remember your number.
Vanity numbers are an excellent way for consumers to recall your company. The danger with a lot of advertising is that your ad will sometimes drive customers to competitors. It's true. A potential customer sees your ad for loans, is interested, throws away the ad, and forgets your number. Now they open the phone book, see your competitor's ad and they call them. Believe me it happens everyday.
That will not be a problem if you have a number they never forget.
If you make money from incoming calls and if you spend any money to generate those calls ... you must use a great vanity number.
The question is how can you get a number like 1-866-HOMELOAN? That's why you come here and read this power-packed, information loaded blog developed to help mortgage professionals like you close more loans and make more money through effective marketing and business advice.
Think about that, you could own a number like 1-866-HOMELOAN exclusively in your market. Think about your competition when you start to plaster 1-866-HOMELOAN or 1-877-GET-A-LOAN all over your town.
It will drive them crazy!
No longer will you have to worry about anyone remembering your number. Everyone knows the number 1-800-FLOWERS. Everyone will know your number.
These numbers are already working for hundreds of other brokers throughout the United States.
LICENSE A GREAT NUMBER FOR YOUR MARKET TODAY
Here's a message from Primary Wave Media:
Primary Wave Media has been helping mortgage brokers grow their business and client base for over 5 years. We own and license hundreds of great vanity toll free numbers to businesses for use in their local and national marketing including First Residential Mortgage(tm), AT&T(tm), Time Warner Cable(tm) and Exclusive Resorts(tm). If you currently spend any money marketing your business, you must use a great vanity number. Vanity numbers have shown time and time again to not only increase response rates from all types of marketing, but to increase referral business as well.
Let's face it, consumers are bombarded everyday with advertising messages. We see them on TV, on billboards, in newspapers and magazine and hear them on the radio. It is impossible for us to remember the ads or companies. Now you can give your clients and potential clients an easy way to remember to reach you. More calls equals more business. Opportunities and phone numbers like these doesn't come around very often. License a number before your competition does. Increase your numbers with one of ours!!!
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* Vanity Numbers have a track record of increasing advertising response by 30%+
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Study offers advice on what to say — and what not to say.
By Ann Brenoff
LOS ANGELES TIMES
Sunday, December 17, 2006
Words matter. Wars have started over them. Civilizations have collapsed because of them. And it would appear that the speed with which a house sells might be determined by them.
As listings grow old on the vine and frustrated sellers grapple for the slightest edge, the findings of several academics might offer some guidance.
For example, a Canadian professor, as part of a broader study on real estate sales patterns, found that homes where the seller was "motivated" actually took 15 percent longer to sell, while houses listed as "handyman specials" flew off the market in half the average time.
"It surprised even me," said researcher Paul Anglin, who teaches real estate and housing trends at the University of Guelph in Ontario. The study dissected the wording of more than 20,000 Canadian home listings from 1997 to 2000.
What surprised him most was how the buying public put style over substance. Words that denoted "curb appeal" or general attractiveness helped a property sell faster than those that spoke of "value" and "price."
Homes described as "beautiful" moved 15 percent faster and for 5 percent more in price than the benchmark. "Good-value" homes sold for 5 percent less than average.
Another finding in Anglin's study was that the plea of "must see!" was received about as enthusiastically as a dinner-time telemarketing call. Homes with listings using the words "must see" had a statistically insignificant impact on the number of days they took to sell.
Listings where the word "landscaping" was heralded sold 20 percent faster, and homes in "move-in condition" took 12 percent less time to sell than the benchmark, although the study showed "move-in condition" had an insignificant impact on the sales price.
Owners use listing language to convey how serious they are about selling. Some words work better than others, Anglin's study found. Listings in which the seller said he or she was "moving" sold for 1 percent less in price compared with 8 percent less when the seller was "motivated."
Real estate listings, not unlike personal ads, are crafted to minimize blemishes and maxi- mize perceived selling points. So if "enjoys moonlight walks on the beach and cooking together" means "I'm unemployed and am looking for someone who won't always expect to eat out," then
"needs TLC" might mean "this house will have you on a first-name basis with the clerks at the local hardware store."
Anglin's study isn't alone in efforts to determine what language moves the market.
Last year, the impact of listing language was covered in a National Bureau of Economic Research study that looked at whether real estate agents selling their own homes hold out for a higher price. (They do; the study found they take longer to sell but fetch a higher price.)
Descriptions of houses that indicated an obvious problem — such as "foreclosure," "as-is" and "handyman special" — drew substantially lower sales prices.
Words that suggested desirable attributes — "granite," "maple," "gourmet" — translated into a higher sale price, the study found.
One problem discovered was that "superficially positive" words that, in effect, condemn with faint praise — such as "clean" or "quiet" — had zero or even a negative correlation with prices.
Those findings echo those made in a 2000 paper called "Real Estate Agent Remarks: Help or Hype?" researched by University of Texas-San Antonio finance and real estate professor
Ronald C. Rutherford.
Rutherford found, among other things, that buyers read between the lines. If you can't find anything better to say than "new paint," perhaps it's best to say nothing at all.
Positive and factually verifiable comments such as "golf" or "lake" drew increased sales prices; other presumably positive comments regarding new paint or new carpet brought lower ones.
"What you say needs to be extravagant," Rutherford said, "or the signal that is received by buyers is that it's not worth talking about."
But what do sellers know? "New paint" appeared on 15 percent of the listings and was the most commonly listed comment.
Rutherford said sellers would be best served by a listing with "just the facts, ma'am."
"In today's market," he said, "if it's a good deal, you need to convey it with factually verifiable language."
An example: "Needs repairs," he said.
Of the information from his study, conducted between 1994 and 1997 of almost 60,000 closed residential transactions in Tarrant County, what surprised him most?
That homes with "motivated" sellers stayed on the market 15 percent longer than average and sold for 4 percent less.
His theory: "They overpriced the house to start with and eventually had to lower it. That explains the length of time on the market and the lower sales price."
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In 20 years of real estate I've seen alot of real estate trainers and motivational gurus. By gummit one of the best is Mr. Howard Brinton. Enough flattery. This article is fromm Howard is pure Gold.
7 Phrases to Avoid with Clients
Change your words and you’ll change your results. Here’s a list of weak phrases to stay away from, along with more powerful alternatives.
BY HOWARD BRINTON
Words are powerful things. When speaking with prospects, clients, and colleagues, your choice of words and phrases shapes their perception of you; it tells them if you're can get the job done effectively and responsibly.
However, many people don’t realize they have a habit of using weak phrases that undermine their professional image.
These phrases imply that you’re giving up control and accountability and are placing it on someone or something else. Consider using these more powerful phrases instead: “I am,” “I choose to,” “I can,” “I will find out,” and “I’ll create.” A subtle change in word choice puts you back in control and allows you to regain ownership of the outcome.
The next time you’re talking to a client, pause for a moment to listen to the language you’re using — are you subconsciously putting a negative spin on the situation and giving them a reason to doubt you? Or are you demonstrating that you can get the job done professionally and effectively?
Here are seven phrases that that can negatively affect the outcome of your conversations, along with some better alternatives. By paying close attention to the words you choose, you're taking control of your relationship with clients.
Phrase 1: “Here’s the Problem”
Your clients don’t want to hear about a problem associated with selling or buying their home; they’d rather know what you’re going to do to solve it. Instead, use words like challenge or opportunity. These words imply action, as in “Here’s our challenge — we need to fix up this house on a small budget! Let’s talk about where to start.”
Phrase 2: “I’ll Try”
This phrase is laden with doubt. It gives the impression that you’ve already concluded that you will not be able to help them. Instead, consider using I will. If you aren’t positive that you can deliver on the promise, explain what you’ll do to achieve the goal. Then provide a few paths you will take as an alternative approach, if necessary.
Phrase 3: “But”
This word is often an “I can’t” in disguise. For instance: “We’ll market your property at this price but I can’t guarantee it will sell.” Instead, use the word and, as in “I will market your property at this price for four weeks and if we don’t receive any offers, I’m going to ask you for a price adjustment.”
Phrase 4: “You Should”
This phrase kills marriages as well as sales. Down deep, you may want to say, “You should paint the exterior and remove all of these dead shrubs,” but instead consider ways to rephrase it so that you're creating a sense of empowerment. This is a better way to phrase it: “If we paint the exterior of the house and work a bit on the landscaping, we'll be in a better position to increase the asking price.”
Phrase 5: “You Have To”
As in, “You have to list at this price if you want to get any activity." Phrases such as this one often make people mad simply because it takes away their sense of control. Instead, say “You can position this property anywhere in the market that fits your needs, remembering that homes sell faster at one price compared with another.”
Phrase 6: “It’s Not My Fault”
This phrase is a quiet killer. Odds are good that you don’t say it out loud to your clients, but even when you think it they can hear you. If something goes wrong, forget whose fault it is. Instead, focus on a solution by affirming “I am in complete control of the outcome and responsible for what I do next.”
Phrase 7: “No Problem”
Sounds harmless, right? Not so fast. I’ve always believed that you should never answer someone’s request with “no problem.” It implies that the request could have been a problem, or that it was almost a problem. Indirectly, the phrase can evoke negative emotions, whether you meant it or not. Instead, try answering with a simple It’s my pleasure.
Simple But True
Some of these ideas may seem rather simple. The good news is, they are! It's really just a matter of understanding that the subtlest changes in your choice of words can produce the biggest wins. With a little practice, I'm confident that you will begin to see how a few subtle word changes can have a remarkable impact on your success.
Most of us know some of the basic do's and don't but its never a bad idea to review them. I saw this article from Realtor online magazine and just had to share it with you. I hope it helps. The author also gave some excellent websites to search for additional ideas and information on ettiquette that I have included at the bottom.
Mind your manners
Business Etiquette for the Holidays
Holiday cheer comes once a year, but good impressions can last a lifetime.
BY DINAH ENG
This festive time of year offers no shortage of opportunities to network, celebrate with colleagues, and show your appreciation to clients with holiday cards and gifts. Yet with all of these cheery occasions comes the potential for etiquette mishaps. Here, manners experts and real estate pros answer some common questions and provide tips that will help you make a great impression this holiday season.
Sending Cards: Is E-mail Acceptable?
It seems everyone in the real estate business is connected to their computers. So it would certainly be convenient — and affordable — to send electronic holiday cards to clients and colleagues. But is that acceptable?
“E-mail cards are being done a lot,” says Beverly Langford, author of “The Etiquette Edge: The Unspoken Rules for Business Success” and a principal of LMA Communication in Atlanta. “But there are people who would think that’s the easy way out, so it depends on your audience. I wouldn’t send e-cards to everybody. But something is better than nothing, and sooner is better than later.”
Charles Price, a broker with Coldwell Banker Mountain West Real Estate in Salem, Ore., says it’s always better to do cards the old-fashioned way. People love getting mail during the holidays, and it will make your message more cherished. “Handwritten notes are like gold,” he says. “It’s one of the best things you can do. You need to stay in contact with people at every opportunity, and the holidays are a season where you can market yourself with cards and gifts.”
Gift-Giving Dilemmas: What to Buy?
Shopping for your valued clients and most trusted colleagues can be tough. You know them on a professional level, but do you really know what they’d enjoy as a gift? Luckily, there are plenty of options that will please just about anyone. (Check out REALTOR® Magazine’s holiday gift guide for ideas.)
Edible gifts are always a safe bet, Price says. “Food or wine — if the client drinks — make appropriate gifts during the holidays because there’s a lot of entertaining going on,” he says. But any thoughtful present will do.
“A doctor and his wife recently closed on a house, coming here from Southern California in the middle of our rainy season. So I gave them two automatic umbrellas from Nordstrom, and a $50 bottle of wine to the doctor who referred them to me. It’s good to show your gratitude.”
If shopping for clients who just bought or sold a house, use the price of the listing as a guide, Langford suggests. “If you’ve just sold a $3 million house, you might want to do something like a lavish gift basket from Godiva.”
When it comes to your broker, what gift is best? Peggy Post of the Emily Post Institute Inc. in Burlington, Vt., says it’s not necessary to give gifts to bosses, in general. “You don’t want to look like you’re currying favor,” she says. “But if you feel like you really want to do something, you can bake something or buy something very simple. Another way to handle it is to get several people to pitch in for something.”
If a colleague buys you a gift, but you didn’t buy him one, don’t fret. Just graciously thank him for it, Langford says. It’s not necessary to reciprocate, but you may want to make a note to yourself to get something for that person next year.
Going to the Party: What to Wear, Bring?
So, you’ve received an invitation to a holiday party. Now comes the tough decision — what to wear. Don’t make assumptions, especially if you’ve never been to that party before. “If the invitation doesn’t state the attire, call and ask,” Langford says. You don’t want to show up underdressed to a black-tie event. Likewise, “If it’s strictly a professional party, don’t go in sparkling like a Christmas tree.”
To arrive to a party at someone’s home in style, there’s one accessory you can’t forget: a gift for the host. Post recommends a small box of high-quality chocolates. “Or, you could bring something you’ve made, like muffins for the hostess’ breakfast the next morning, a decoration for the tree, or bulbs if they’re gardeners,” she says. “Just something simple to denote your gratefulness for the invitation.”
One thing to avoid bringing: cut flowers, Langford says. The flowers may be pretty and smell great, but the host will have to abandon her guests in order to arrange the flowers into a vase. After the party, a thank you note to the host will be well appreciated.
Conversation Starters: What’s Off Limits?
As a real estate practitioner, you probably have no problem striking up conversation in social situations. However, at a work-related party, you should make an effort to veer away from “shop talk” and include spouses in the conversation. “Talk about noncontroversial current events, holiday plans, or people’s families,” Langford suggests. “Ask open-door questions that let the other person talk.”
To be on the safe side, avoid talking about issues that may lead to heated debates or get too personal. If you plan to broach more touchy topics, such as politics or religion, “know who you’re talking to and whether they’ll enjoy a spirited conversation,” Price says. “You need to be careful not to get into an argument that leads to hurt feelings.”
Price also adds that you should keep the conversation positive, and never gossipy. “You should never say anything negative about other colleagues in a public situation,” Price says.
Making a Toast: What Should I Say?
Whether you’re moved to make a toast at a friend’s party or you’re hosting a gala and would like to say a few words, keep a few pointers in mind.
For example, the host or hostess offers the first toast at a formal occasion such as a dinner party. Around a dinner table with friends, a guest can propose the first toast and often does so to thank the host for bringing everyone together, according to the Emily Post Institute.
Keep it short and to the point, focusing your remarks on the event being celebrated. A joke or short story is OK, as long as it’s clean. For a boost of confidence, write out what you wish to say and then practice it ahead of time, the Institute recommends.
Too Many Places to Be: How to Decide?
As party invitations start rolling in, you realize just how popular you are. Unfortunately, the season is short and parties inevitably will conflict with one another. If invited to several occasions on the same day, what should you do?
“Go to all three,” Langford says. “People understand during the holidays that you’ll have many commitments. I’d much rather guests come by for 30 minutes and leave than say you can’t come because you’ve got to go to another party.”
Post, on the other hand, says you may decline two of the invitations by simply saying, “Sorry, I can’t make it.” No explanation is necessary. What’s key, she says, is that if you say yes to one person, you honor that commitment even if a more desirable invitation arrives later.
“You could try to attend two of the parties,” Post adds. “But if the invitation is to a sit-down dinner, you need to sit and stay.”
Regardless of whether you go or not, you absolutely must RSVP. If you’ve ever planned a party before, you know how frustrating it is to be in the dark about who is coming.
Stating the Obvious: Watch What You Drink
Among all holiday etiquette faux pas, having too much alcohol to drink always tops the list, experts say. Your professional reputation and your friendships are at stake.
“I had a cocktail party one afternoon, and somebody broke a Waterford flute and didn’t bother to tell me,” Langford recalls. “I found it stuck in a corner afterwards. I was really surprised, given the people who were invited.”
To avoid embarrassing situations, either don’t drink alcohol or limit your intake. The days of work parties where coworkers let down their hair, got drunk, and ended up wearing lampshades on their heads are out of style, the Emily Post Institute says.
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I wish the Canadian Real Estate Association could be so informative. This real estate company in Florida has published the 10 things you should never do yourself. Of course number 1 is, "Never Sell your own home". Kind of funny but its true.
As you may have noticed, The Walk-Through has been awfully quiet lately. It had a good run, but we've decided to turn our focus to other parts of our real estate pages. We recently expanded the site with two new sections: Great Homes features a searchable database of more than 30,000 listings in popular second-home [...]
Who needs to go to a bank to get a mortgage when you can go to a college? Professors and administrators in the University of California system are getting lovely loans of less than 2 percent, says the San Francisco Chronicle. The University of California has issued thousands of low-interest home loans to executives, faculty [...]
The bellwether of West Coast real estate is San Diego. The latest development from Voice of San Diego: The average San Diego home is worth less now than it was a year ago. That's the message that can be inferred from statistics released this morning by DataQuick Information Systems. The median price of homes sold [...]
I got this email from the Marin Real Estate Bubble blogger, one of the loudest voices in the real estate price run-up saying that something was amiss: I've lost my faith, at least for Marin County. Despite all reason and rationality to the contrary, I am no longer so sure that Marin County will succumb [...]
The Vancouver Housing Market Blog tried to find a link between the climb in housing prices and the rise in population. It's a pretty tenuous link, it says. Moreover, there is no perceptible increase in 2003-2005, when the big price boom started. This says, pretty conclusively, that the price boom of 2003-2005 was not driven [...]
It's time for another roundup of what's happening with housing around the country. There aren't many bright spots if you are a seller. Oversupply of homes for sale in the Twin Cities. Half the houses in a (formerly) hot San Francisco neighborhood have been reduced. Zip Realty Price Reduction list. Seattle condo market has peaked. [...]
Found this article this morning. The points I found important - the percentage of consumers using discount brokerages has increased from 2% to 11% in just a few years. That the new trend of buyer discount firms that offer to just do the paperwork and don't actually show you any houses (the listing agent shows the home) has a major flaw. But most importantly, the dispute between the discounters and the full service companies puts our industry in a bad light in the eyes of the media, and consumers...
Real-Estate War Traps Consumers in the Middle
The Wall Street Journal Online
By James R. Hagerty
Full-Service Brokers' Tactics To Rebuff Discount Rivals Sometimes Hurt the Customer
In the fight between traditional real-estate brokers and their discount rivals, some consumers are getting caught in the crossfire.
With house prices surging in recent years, a number of people are seeking ways to cut commission costs, which are based on a percentage of a home's selling price. More home buyers are turning to discount brokers that offer to rebate a portion of the commission if you are willing to do much of the work in finding a home. And sellers are hiring discounters who, for a flat fee of a few hundred dollars, will include your home in a multiple-listing service, a database on houses for sale used by agents.
About 11% of home sellers last year used "alternative" brokers (ones offering flat fees or other forms of discounting), up from less than 2% in 2002, according to surveys by Real Trends, a publishing and consulting firm.
The competition from discounters has prompted some traditional brokers to use a variety of tactics to fight back, and this can end up hurting consumers. The controversy will get a public airing Monday when the Consumer Federation of America, a nonprofit research and advocacy group, releases a report on "how the real estate brokerage industry functions as a price-setting cartel."
The stakes are high. People selling homes typically pay commissions of 4% to 6% of the price, which is split between brokers representing the buyer and seller. Residential real-estate sales generate more than $60 billion a year in commissions. Full-service brokers say that in exchange for the commissions they provide expertise and an array of services that help consumers navigate the housing market.
For consumers, the clash among brokers underlines a need to be wary. Buyers hoping to get a cash rebate from the commission earned by their agent need to be aware that they might meet resistance from agents representing sellers. They should check whether there are any conditions attached to the rebate offer and make clear when viewing homes that they are represented by an agent. And sellers using flat-fee listing services sometimes find that agents for buyers shun their homes.
Most real-estate agents are ethical, says Albert Hepp, the owner of BuySelf Realty, Bloomington, Minn., who helped create a new national association of brokers that charge home sellers a flat fee for a limited range of services. But some full-service brokers step out of line, putting their interests ahead of consumers, he says, adding: "The best analogy I can use is a high-school classroom when the teacher walks out of the room."
One area likely to stir up more disputes involves the discount firms that offer rebates to buyers. The practice got a boost this year with the launch of two ambitious companies, BuySide Realty Inc. and Redfin Corp., which are promoting this concept heavily as they try to build national brands. Both encourage buyers to do part of the work in finding a home; they don't offer the free car rides from house to house provided by most traditional agents.
Andrew Calloway, a financial analyst in St. Louis, decided to use BuySide because that firm rebates 75% of the commissions it receives to the buyer. He recently agreed to pay $200,000 for a three-bedroom home in Glen Carbon, Ill. He expected a rebate of $4,500.
But Mr. Calloway says Karen Malench, an agent for Coldwell Banker Brown who represents the sellers, tried to dissuade him from using BuySide. He says she offered a rebate of $2,000 to him if he dropped BuySide and used her firm instead. He declined and went ahead last month with his offer through BuySide. Then he learned that Coldwell plans to refuse to give BuySide a share of the commission on the ground that Coldwell, not BuySide, showed Mr. Calloway and his fiancee, Rebecca Collins, the house and made the deal happen. If BuySide doesn't get a slice of the commission, it isn't obligated to pay a rebate to Mr. Calloway.
"The thing that really upsets me is that the listing agent smiles to your face and puts a knife in your back," says Mr. Calloway.
Ms. Malench, the listing agent, declined to comment. Gerry Schuetzenhofer, president of Coldwell Banker Brown, a franchisee of the national Coldwell brand, says that Ms. Malench denies having offered him $2,000 to drop BuySide. Mr. Schuetzenhofer says Mr. Calloway and his fiancee didn't make clear that they were working with another broker when they first viewed the home. Mr. Calloway says he did make that clear.
Joseph Fox, BuySide's chief executive, says this is the first time his young company has encountered such a commission dispute. He says he is trying to work out a solution with Mr. Schuetzenhofer. The latter says Mr. Fox tried "to intimidate me into accepting his demands. I don't believe he would have done that if he was on sound footing." Mr. Fox retorts: "He'd rather think about his pocketbook and not the best interests of the client." One option for the parties is to seek mediation or arbitration through a local arm of the National Association of Realtors, a trade group.
BuySide currently has operations in California, Florida, Illinois and Georgia. The company plans to cover 39 states by the end of 2008.
Cem Sibay, a business-development manager at an Internet company in Seattle, sought a rebate through Redfin. Mr. Sibay says he and his fiancee, Tam Pham, arranged to see a condo about six months ago. The agent representing the seller, Ron Waxman of Coldwell Banker Bain, was initially friendly and helpful, Mr. Sibay says. But Mr. Sibay says Mr. Waxman's attitude changed when Mr. Sibay mentioned that he planned to use Redfin as his agent. Mr. Sibay says Mr. Waxman then refused to show the condo to the couple again and said he would advise his client not to consider any offer they made.
Mr. Sibay and Ms. Pham gave up on the idea of bidding for the condo.
When reached for comment Wednesday, Mr. Waxman said, "I don't remember that at all." He said he stopped working as an agent last year; then, a few minutes later, Mr. Waxman acknowledged that he was still working as an agent and declined to comment further.
Bill Riss, the owner of Coldwell Banker Bain, says his agents sometimes "push back" against discounters like Redfin because they believe such firms don't do their share of the work. But he adds that his firm's policy is to work with any member of the local multiple-listing service, including Redfin.
Mr. Sibay kept working with Redfin and last month agreed to buy a different home in Seattle. He expects to receive a rebate of about $10,000 when the transaction is completed.
Glenn Kelman, chief executive officer of Redfin, says resistance from traditional agents will abate as his company completes more deals and becomes more established in the market. The company began operating in Seattle in February, recently opened up offices in the San Francisco Bay Area, and plans to expand to San Diego and Los Angeles and perhaps Washington and Boston by year end. In what Mr. Kelman calls a "charm offensive," Redfin recently began sending $100 gift cards to the listing agents when a Redfin buyer completes a purchase. "We need to turn these agents around one at a time," he says.
Discounters representing sellers also are meeting resistance. Jeff Kermath, who owns Amerisell Realty, a flat-fee broker in Saline, Mich., says one of the multiple-listing services he works with, Realcomp II Ltd., in the Detroit area, discriminates against firms offering discounts for limited service. For instance, Realcomp, owned by local Realtor groups, doesn't send limited-service listings to popular home-search sites like Realtor.com. And the default search setting for agents using Realcomp excludes limited-service listings, meaning fewer potential buyers hear of them.
Hello everybody. Just in case you were wondering what we were up to we are still here and caught up in one of the craziest housing markets I've ever seen.
Not only is the market booming but we are simply beyond capacity to deal with Sara's lead generation abilities. Her consulting business continues to grow and we are in the process of getting our next jam packed issue out.
The search engine marketing does work with proper lead management and capture systems in place, but this is quite frankly beyond the realm of the average agent and if you are not properly set up you will quite frankly turn yourself inside out trying to figure this stuff out. So keep it simple.
Well, the good new is as an industry we are adapting. According to this most recent survey from NAR the number of people using technology in their business has drastically increased, but in my opinion, still pretty low.
NAR Technology Survey Reveals Heavy Tech Investment By Realtors®
CHICAGO (May 11, 2006) – The number of Realtors® with Web sites has increased 129 percent over the past five years, and many of the sites display property listings, according to a new survey by the National Association of Realtors®.
The 2006 Realtor® Technology Survey, conducted by NAR’s Center for REALTOR® Technology, reveals that the Internet ranks third in generating leads, behind referrals and repeat clients, and ahead of community involvement. The survey also shows that there is a clear connection between technology spending and Internet-generated leads, and that getting leads from the Internet continues to grow.
Realtors® have invested heavily in Internet technology and security, through Multiple Listing Systems and individually, in the past several years. For example, the survey showed that thus far in 2006, 56 percent of agents spent more than $1,000 apiece on technology and that 30 percent spent $2,000 or more. In addition, 16 percent of agents and 28 percent of brokers are now spending more than $1,000 annually on their Web sites. Realtors® with personal business Web sites – not including an area on a broker’s site – was 71 percent in 2006, compared to 31 percent in 2002, showing a jump of 129 percent.
“Consumers are able to use information portals to look for homes to buy because Realtors® have invested huge amounts of resources in technology to make accurate information available on secure sites, thus bringing added value to the transaction. All this information is available to consumers, free of charge, 24 hours a day,” said Thomas M. Stevens, 2006 NAR president and senior vice president of NRT Inc., from Vienna, Va.
The survey also showed that the amount of investment in Web sites has a direct relationship to the number of leads coming from the Internet. Thus, 40 percent of those who spent more than $5,000 on their Web site showed that more than 60 percent of their leads come from the Internet.
Realtors® are also reacting more quickly to online inquiries. In a surprising change from past surveys and findings, over half the survey respondents indicated that it takes them less than two hours to respond to an Internet inquiry, and only 2 percent indicated that it took them more than a day to respond. That compares with a 2004 survey showing that only 27 percent of practitioners responded within eight hours to an online inquiry and 46 percent of inquiries received no responses.
“While the survey indicates that the vast majority of Realtors® take steps to protect themselves and the listing information provided by their clients and customers, more work remains to be done,” said Mark Lesswing, NAR vice president and director of CRT. “Less than a third of respondents have received information security education from their MLS or brokerage. Only one-third are aware of written security policies that they must follow and less than half have a written privacy policy. Programs like CRT’s REALTOR® Secure can definitely play a role here.”
The survey shows that use of automated transaction management systems, used to electronically monitor each step of the real estate process, continues to rise, moving from 13 percent in 2005 to 26 percent in 2006, with 70 percent of users saying they are satisfied with their applications.
The survey was based on data from field research conducted in April of this year. CRT e-mailed the survey to 20,000 NAR members, including agents and brokers and generated 719 usable responses. The 2006 study is available at http://www.realtor.org/crtweb.nsf/pages/CRTsurvey?OpenDocument.
NAR’s Center for REALTOR® Technology was established to provide technology leadership, guidance and assistance for NAR members; CRT makes available informed industry insight, research and open-source applications through its mission of implementation, advocacy and information. Information about CRT is available at http://www.realtor.org/crt.
The National Association of Realtors®, “The Voice for Real Estate,” is America's largest trade association, representing more than 1.2 million members involved in all aspects of the residential and commercial real estate industries.
Another good article from Bernice Ross of Inman news... The premise here is that people are naturally attracted to people like themselves. So if you want friendly clients, you should be friendly, if you want funny clients... well I think you get the idea....take the quiz!
One of the most powerful strategies from professional coaching is the principle of attraction. Attraction refers to the fact that people "attract who they are." In other words, those we attract normally are like us in one or more ways. No matter what price range you work with, the clients who gravitate to you will probably share a number of the same characteristics that you have. If you want high-quality clients who tell the truth, do what they say they will do and are a pleasure to work with, you must be the same way. On the other hand, if your life is always in chaos, if you lie, or are undependable, you will attract people who behave in the same way. Consequently, one of the primary ways to attract a better quality clientele is to raise your own personal standards. To determine your "attraction quotient," take the quiz below:
1.) Do you always tell the truth, even when it is unpleasant?
2.) Are you always on time for appointments?
3.) When things go wrong, are you the one who stays calm and solves the problem?
4.) When you take a listing, do you deliver all the services that you promised the sellers?
5.) Do you stay in constant contact with the sellers keeping them updated on the showings and the responses to your advertising?
6.) Does your print advertising fall into the category of "understated elegance?"
7.) Do the people who have visited your Web site tell you that your site is "very professional?"
8.) Do you avoid using profanity when you are with clients, no matter how bad the circumstance is?
9) Do you avoid telling off-color jokes or making remarks that may make others uncomfortable?
10.) Is your car clean and well-maintained?
11.) Do you go out of your way to make sure that your buyers have water, snacks, and something to keep their children occupied if you are taking them out to look at property?
12.) When you lose business to a competitor, are you gracious to the buyer or seller when they tell you?
13.) Are your marketing materials "top drawer?"
14.) When someone becomes angry with you, do you make peace rather than escalating the argument?
15.) Do you (or your assistant) respond to your telephone, e-mail, and Web inquiries at least once daily?
16.) Are you relaxed and calm when you are with clients rather than hurried, frazzled, and stressed out?
17.) When you hold an open house or have a client meeting, do you always dress professionally?
18.) Do your past clients consistently refer new business to you?
Scoring:
Each "No," represents an area where you can begin working to raise your standards. It makes no difference where you start. The goal is to take a number of simple steps over time. Begin with whatever is easiest on this list to fix. The more items you clear off the list, the more attractive you will become to a wide range of clients.
The key to becoming more attractive to the best possible clients is to always maintain a client-centric focus. When you are client focused, people are attracted to you. They are also more likely to refer you business. On the other hand, if your focus is on making the deal rather than providing the best possible service to the client, your desperation may cause some clients to go elsewhere. Remember to always put your clients' needs first no matter how desperate you are for money.
Being more attractive to better clients also means being willing to say "no" to clients who are dishonest, unethical, or who make your life miserable. Saying "no" reduces your stress. It also helps you avoid problems that can pull you off focus and cost you money. More importantly, if you hang on to buyers or sellers who consistently fail to perform, you actually block better business from coming into your life. Eliminating them creates the space that attracts new business. Before you question the validity of this claim, ask any veteran real estate agent what happens every time he or she plans a vacation. Business always picks up. Thus, raising your standards by eliminating non-performing clients opens the door for new and better business.
If you want to raise your personal attraction quotient, continually work on upgrading your professional image, market with top drawer materials, maintain a client-centric focus, and be willing to say "no" to people who are not a good fit for your business.
The names may change but the game remains the same from their prospective. Be the dominant player and grow bigger and bigger and bigger. Just how big is big enough? Who knows only time will tell and maybe some day there will be a reverse of this process. The interesting thing in the article on Inman news is the focus on Coldwell Banker as the major force behind these companies. Not C21, Not ERA or Sotheby's.
Just over 10 years after Cendant's predecessor began a buying spree that included real estate brands Century 21, ERA, PHH and Coldwell Banker, the company's impact on the industry is undeniable. With about 25 percent of all Realtors in the nation affiliated with the corporation, the story of the largest real estate brokerage and franchise company in the nation is still unfolding.
This story is packed with elements of mystery and intrigue, twists and turns, massive-scale acquisitions and consolidations, deception and scandal, courtroom drama, financial fallout and recovery, a restructuring of management, a rapid rise to power and prominence, and a carefully calculated breakup and re-branding. The cast is thick with power brokers and industry luminaries.
Cendant Corp. grew its real estate operations with hurricane force, building upon the buying spree of predecessor HFS, a hotel franchisor.
Tracing back 11 years, Cendant's real estate roots were planted with the acquisition of Century 21 by predecessor HFS in 1995. From 1995-97 HFS acquired Century 21, ERA, PHH and Coldwell Banker, and Cendant was formed through a merger of HFS Inc. and CUC International Inc., a direct marketing and member services company, in December 1997.
Since inception, the company has been a cash cow for real estate company owners seeking an exit strategy, and has driven an unprecedented surge in industry consolidation.
Not even a decade old, the company has amassed a collection of reputable brands, with such company-owned and franchise affiliates as Century 21, Coldwell Banker, ERA and Sotheby's, and about 313,500 sales associates are affiliated with Cendant's major company-owned and franchise real estate brands. There are about 15,000 residential and commercial real estate offices affiliated with Cendant's Real Estate Franchise Group.
NRT Inc., a Cendant subsidiary that oversees company-owned real estate offices, acquired 31 companies last year and has acquired about 320 companies since its creation. NRT has about 1,000 offices and 64,000 sales associates and operates in about 35 major metropolitan markets across the country.
Revenue for Cendant's real estate services division in fourth-quarter 2005 reached $1.62 billion, which represents about 38 percent of the company's total revenue for that quarter. In addition to its real estate business, the company also has operations in the hospitality services, timeshare resorts, vehicle rental and travel distribution services industries.
Focus on business and consolidation
Larry Knapp, president of Saratoga, Calif.-based Alain Pinel Realtors and a former NRT executive, said Cendant has brought a more intense business focus to the real estate brokerage industry. "The creation of what is today known as Cendant has forced the rest of the industry to operate at a higher level, which it has done. I think that the real estate industry before this (Cendant) consolidation play came along was run less like a business and more by the seat of somebody's pants."
Knapp, who began his real estate career in 1969 as a real estate agent in Sacramento, Calif., served as president for Coldwell Banker Northern California from 1985-97 and later served as senior vice president for NRT Inc.'s Western Region. NRT was initially established in 1996 as a real estate trust and grew through acquisitions to become a dominant real estate brokerage company. NRT Inc. began as a joint venture with Apollo Management, an investment group, and in 2002 Cendant bought out Apollo for about $230 million worth of stock and the assumption of about $300 million in net debt.
Cendant predecessor HFS was known for its franchising success, so real estate franchise operations were a good fit, but company-owned real estate operations posed a new challenge, Knapp said. It would have been easy for Cendant to simply be the "gorilla franchising business" based on the brands it had acquired from predecessor HFS, Knapp noted, but the company was not content with a singular role as real estate franchisor.
"The impact of Cendant and HFS on the industry was more from the consolidation play on the company-owned side than it was on the franchise side. That's where they left their core business of franchising. There was a learning curve," he said. "The company-owned operations created a dilemma for them. They were in competition with their franchisees. Early on (Cendant was) very aggressive in selling franchises. They started selling franchises in the middle of company-owned operations. There was an adjustment period where the franchise side of the business and the company-owned side of the business had to kind of agree on the rules and regulations of expansion. The message got over to the franchise side: sell outside the perimeters of company-owned (offices)," Knapp said.
Cendant Chairman and CEO Henry Silverman had told real estate managers that he believed the real estate industry was ripe for consolidation on a large scale. That movement had already begun prior to the arrival of HFS and Cendant to the real estate scene – companies like Coldwell Banker and Merrill Lynch had been active in consolidation efforts in years prior.
Cendant had an acquisition strategy that focused on gaining market share within a particular market area, he said. "Most of the consolidation they did was in the markets where they already had a presence ... merging them into existing operations, closing unneeded offices, reducing redundant costs and in some cases eliminating duplicate advertising costs. While some of these acquisitions put them into new markets, most of them were consolidations right in markets where there already were (existing company-owned offices)," he said.
The company-owned operations became a good channel to purchase the operations of Cendant franchise businesses that were for sale, Knapp said.
Though Cendant has established a reputation as a major consolidator, Knapp said the company did not make a name for itself in the early years as a trailblazer in technology or business innovation, for example.
It was a challenge, he said, to combine all of the legacy technology systems for all of the companies that it had acquired. "It would've taken a rocket scientists to get it all together. I think it took them a long time back in New Jersey to realize how important the technology play was going to be and do it on a large scale. They worked hard to present a good technology system like all the rest of us." It was also a tall order for NRT to streamline the bits and pieces of many real estate-related services, such as mortgage and settlement services, from its various acquisitions and turn that into a functional business, he said.
Cendant has at times been a trendsetter in the adoption of new technologies, and took a big technological step in November 2004 when it announced the launch of LeadRouter, a lead management system that quickly feeds leads to real estate agents via telephone or e-mail from a variety of sources.
The company last year launched a tool called SearchRouter, which allows consumers to navigate from the main Web sites of its national brands to a large inventory of property listings in a local market area.
Also, NRT Inc. this year extended a marketing agreement for enhanced property advertisements at the popular home-search site Realtor.com. NRT first announced a marketing agreement with Realtor.com's parent company, Homestore, in Feb. 22 for the enhanced display of all NRT-affiliated listings at the Web site. The company's actions speak volumes about an increasing shift in real estate advertising to online venues.
Cendant announced a plan to spinoff its real estate segment in June this year as a separate company called Realogy. As proposed, the new company will have its stock listed on the New York Stock Exchange under the symbol "H." Cendant also plans to launch separate companies from three other operating segments.
Bob Moles, chairman of Cupertino, Calif.-based Intero Real Estate and former president and CEO for Cendant's Real Estate Franchise Group, was president of Contempo Realty when that company was bought by NRT in 1997.
When HFS acquired Century 21 and ERA, the industry was still trying to figure out whether the company would become a major figure in the industry, Moles said. The acquisition of Coldwell Banker and then PHH, which included mortgage services and relocation services, made it clear that Cendant was sincere.
"The acquisition of Century 21 sent a signal, and ERA sent a signal. People (said), 'Wow, what is this?' The acquisition of Coldwell Banker was big. After Coldwell Banker and after PHH, people thought this was a very serious company," he said.
After Cendant formed, the company set its sights on acquiring regional independent brokerage companies, and it was not uncommon for the company to rattle off several new acquisition deals in a single week.
Among the major deals: Jon Douglas Co. in Southern California, Arvida Realty Services in Florida, Burnet Financial Group in Minnesota and Chicago, The DeWolfe Cos. in New England, and Fred Sands Realtors in Southern California. All of these companies had an annual sales volume in the billions. Other major acquisitions included Hunneman Real Estate Corp. in Boston, Gundaker Realtors in St. Louis, Cornish & Carey Residential Real Estate in Northern California, Coldwell Banker Stevens in Washington, D.C., and Baltimore, O'Conor, Piper & Flynn in the Northeast, Contempo Realty in Northern California, Northside Realty in Atlanta, and The Corcoran Group in New York.
Cendant definitely escalated industry consolidations, said Moles, who was named president and CEO of Century 21 Real Estate Corp. in 1997 and later oversaw franchise operations for all of Cendant's real estate brands until he returned to California in 2004 to join Intero.
"I wouldn't have traded the experience," he said of his time at Cendant. "Those first three or four years were pretty exciting years and it was really unique to be a part of that. This is a very entrepreneurial business. There were times when people were having to move very fast." When he arrived at the company there were about 1,700 employees and when he left there were about 92,000, he said.
Cendant brought lots of capital into play in the real estate industry, which had never been done before in such a big way. And the timing was right for HFS and Cendant to make a move, he said. "Clearly in the seven years I was out there we really had the wind at our backs in terms of property appreciation and (sales)."
Knapp agreed, "The timing of the creation of NRT was pretty perfect. From 1997 until now has been probably the best nine years in the history of real estate. The market is not likely to continue to grow."
Cendant officials are well aware of changing sales market conditions this year. In February, the company announced it would consolidate local offices to quickly cut about $50 million in costs.
The real estate market turned rapidly in December 2005 in some markets, and the company saw a cancellation rate on sales transactions spike about 30 percent that month, perhaps because speculators were fleeing. Also, the volume of real estate transactions at NRT companies dropped about 19 percent in New England, California and Florida in fourth-quarter 2005, the company reported, while transaction volume in other market areas increased about 4 percent during the quarter.
Small and mid-sized companies face an increasingly competitive real estate environment, Moles said, and there are challenges for large national companies, too. Massive size can be a ''two-edge sword," he said. "Sometimes when you're real big the ability to move quickly ... is hampered. I think (size) can be both a blessing and a curse." But Cendant has effectively used its size as an asset in consolidating the industry.
Also, it can be difficult to manage real estate operations within a publicly traded company, Moles said, as "you've got to manage to shareholder expectations – sometimes it's difficult to take a long-term perspective."
With the real estate segment as a separate company, the national scope of Cendant's real estate operations and its franchise royalties should provide some balance to market fluctuations in specific geographic areas, Moles said. "Its revenue streams are diversified across major metro areas."
Early days
Before today's successes, the corporate marriage of HFS and CUC proved disastrous in its early stages. Cendant in 1998 restated its earnings for 1995-97, revealing that "a 'widespread and systemic' fraud had occurred at CUC and the merged company that included improperly recognizing fictitious revenues, falsely coding services sold to customers and fraudulently manipulating merger reserves," according to court documents. A report adopted by Cendant's Board of Directors found that CUC's operating income was inflated by about $500 million during a period from May 1995 to August 1998, the court documents reveal.
In financial filings to the U.S. Securities and Exchange Commission in 1998, Cendant reported that earnings had been overstated by about $300 million, or 24 percent, during that three-year period, and earnings per share were overstated by about 130 percent.
Cendant officials did not offer any comment for this article due to "vacation schedules," Kevin Doell, a spokesperson for Cendant's Real Estate Services Division, said.
Cendant's stock price plummeted with the news of the accounting fraud. In one day following the company's initial disclosure in April 1998 about the problems, Cendant's stock dropped 47 percent per share and its market capitalization sunk $14.2 billion. With later announcements in July and August the company's market capitalization dropped further – for a total of $20.5 billion, or 67 percent, court documents state.
Several company officials made millions by selling shares of stock before the radical drop in stock price. Chairman and CEO Silverman in February 1998 sold 1.7 million shares of Cendant common stock – his entire holding in the company – and received $61.4 million, according to court documents.
Heads rolled. Walter A. Forbes, the former CUC chairman, CEO and president who served as chairman of Cendant's board of Directors following the merger, was forced to resign in July 1998. Forbes sold about $38.5 million worth of CUC and Cendant common stock, court documents state. E. Kirk Shelton, vice chairman for Cendant and former CUC president, was terminated in August 1998. Shelton earned about $23 million in Cendant and CUC stock proceeds. A group of other former CUC officials also resigned as the scandal unfolded.
I am in the process of building a web page designed to be a legal resource for FSBO sellers and buyers -- FSBOLawCenter.com. I've found that many of the topics I address here (e.g. the Integration Clause) are better suited to relatively static web pages that are easy to find, as the information is not time-sensitive. Accordingly, many of the posts here will reappear as pages there. In addition, because blogging is a great way to address time sensitive topics (e.g. a story in the NY Times about the future of FSBO) I will be maintaining a blog on that new web site. In the meantime, my enthusiasm for blogging here on blogspot has dropped to an extremely low level. Therefore -- and I apologize for this -- please do not look for new substantive posts at this address. When launched, I will post again about FSBOLawCenter.com, and I hope you will find the page useful and informative. In the meantime, I suggest you check Rain City Guide, an excellent real estate blog where I occasionally post. Thanks to any readers out there who have enjoyed this blog, and I hope to see you at my new address.www.lawofficeofcraigblackmon.com
Typical real estate marketing is unimaginative. Pens, note pads and others. As a victim of this senseless marketing, I too can't believe what I have convinced myself is a good idea. I say victim because there are plenty of influences marketing us. Marketing companies, our own "approved suppliers" hunt us like seals in the spring time. The follow is an excerpt from a blog I read regularly that made me think its a good idea to get an outside opinion the next time I have an idea to revolutionize the real estate magnet industry. In fact at a recent board meeting, I was talking to an old pro, who recently won a contest at their office for the oldest magnet.
I actually remember seeing one of his magnets when I listed a property. Actually when I think about it just about every property I have ever listed has a magnet from somebody on the fridge. Lol...My own fridge has a collage of magnets that I've collected like trophies...So I guess I agree with Frank, spend your money on effective marketing. Article taken from the never cold call blog.
How can this work?
I just checked my mail and found a nice pad with a photo and telephone number for a local realtor on it. I like that realtors are typically more marketing-savvy than other types of salespeople, and know better than to waste time cold calling, but how can this possibly work?
Blindly mailing out pads with your name and number on them isn't effective, and I'm guessing it's also very expensive. If I'm looking for a realtor, I'll ask friends for referrals or search online. I would do so even with this realtor's pad sitting on my desk and his smiling face looking at me.
Remember, cold calling may be a waste of time, but ineffective interruption marketing is a waste of money. Salespeople need to stick with self-marketing that works, not a shotgun approach that is just as random as cold calling.
A lot of this we've all read before, but it's nice to take a minute and refocus. The point of this article is that to build customers for life, you need to focus on the client, not the end result...
RISMEDIA, March 22, 2006—Fostering a client for life goes far beyond marketing plans, print ads, or postcard drip campaigns. Like any long-term relationship, a basis for mutual respect, trust, and honesty must be formed through repeated demonstrations of goodwill and promises kept. iSucceed Mentor and client retention expert Diana Ivas, of Hinsdale, IL, has managed hundreds of repeat clients for decades, some of whom she’s helped buy and sell over ten homes a piece.
Creating a lifetime client from the very first day always begins with a meaningful first impression. Diana’s years of experience have taught her that buyers and sellers are especially sensitive to canned dialogues or disingenuous presentations, and she offers a few tips here, “Dig deep with questions. Find the motivations and commonalities. Be genuine, upfront, and honest; and learn how to entertain your clients without coming off as a phony.” It’s a tightrope walk, finding just the right balance between objective counselor and controlling party, but the level of detail Diana is able to unearth from her prospective customers
The long-term relationship is the ultimate goal, but Diana makes a conscious choice not to dwell too much on the end result of her daily activities. She’s made a clear commitment to remain focused on the client of the moment, especially when the time comes to negotiate price. She remarks, “Most Realtors I know would admit that when it comes to negotiating the deal, they just want it done. And while that may be the gut reaction, I choose to focus on the process rather than the results.” That focus has also allowed Diana to keep a mindset of service in lieu of profit. She explains, “Excellent service generates repeat business – that’s the first thing. The second goal with client retention is to dominate mindshare: when people in your market are thinking about buying or selling a home, yours must be the first name that comes to mind.” Building and maintaining that reputation for quality, enjoyable service keeps Diana motivated from sunup to sundown.
The real challenge for Diana is to effectively communicate on a regular basis with her repeat customers in such a way that doesn’t come off as hokey or contrived. “I really pride myself on the depth of relationship I try to create with each and every one of my clients,” Diana explains. “You must be sympathetic to people’s needs. With a big database, this can be a challenge, but with the right systems in place, you can do it in a meaningful, personal way.” Diana’s personal touch is nearly legendary in her market – from letter-writing campaigns to personalized closing gifts to special events and impromptu visits to her clients’ homes comes an annual sales volume of more than $40 million.
Twenty-year real estate sales veteran Diana Ivas of Hinsdale, IL, has served the suburbs west of metro Chicago since 1986, averaging annual sales in excess of $40 million plus, due in large part to a balanced partnership with her husband, Chuck. When it comes to client retention, no other local Realtor tops the Ivas team – over 60% of their business comes from repeat clients and their referrals. They each play to each other’s strengths, with Diana handling the marketing and buyer’s agent management, and Chuck focusing on the financial and administrative tasks. Diana has been the recipient of a bevy of RE/MAX awards, including the Lifetime Achievement Award, Hall of Fame, Platinum Club, Chairman's Club and Northern Illinois Top 10.
It is official Charlotte Sutherland from CB in Canmore is no longer with the Real Estate Council of Alberta after a long and in my opinion successful 6 year tenure. Charlotte represented members not belonging to organized real estate.
Having been involved with RECA for the past 8 years in many capacities I can say she brought a big voice to those members. She certainly was not easily snowed and was often a voice of reason in what could be at times trying and difficult meetings.
I for one, Thank you Charlotte. Your sacrafices and hard work are appreciated. Far from being retired though Charlotte continues rockin in the rockies in Canmore.
This just in from CBC news online. A bit of a cooling off period at least here in the west could only be a good thing from the perspective of the market here in Edmonton.
TD PREDICTS U.S. ECONOMY WILL COOL IN 2006, CHILLING CANADA WebPosted Wed Mar 22 11:17:13 2006
---The U.S. economy is likely headed for a slowdown later in the year that will spill over into Canada, economists at TD Bank said Wednesday.
In a quarterly forecast, TD economists said U.S. economic growth is expected to slow to an average annual rate of 2.3 per cent in the last half of 2006 and the first half of 2007.
It is about one percentage point below the U.S. economy's long-term potential pace, they said.
The Canadian economy is expected to "marginally slip" below its longer- term trend rate of 2.8 per cent, the forecast said.
"Last summer, we noted that housing market strength and household indebtedness in the U.S. was simply unsustainable, and that it would give way to an economic slowdown in the second half of 2006," said Don Drummond, a senior vice president and chief economist at the bank.
"Evidence is mounting in support of this view."
Slowing sales of new and resale houses will eventually dampen construction and consumer spending in the United States, TD said its forecast.
"There is no two ways about it, the U.S. slowdown will be a drag on economic growth north of the 49th parallel," said Drummond. "But, since Canada has neither the same degree of housing imbalances, nor as much tightness in monetary settings, it should fare slightly better than its U.S. counterpart."
Any slowdown in the United States is expected to be mild and short-lived, the economists said.
But they warned there is a chance the U.S. economy could be in for a longer, sharper slowdown that could have a greater impact on Canada.
In the shorter term, the U.S. Federal Reserve and the Bank of Canada are both expected to go through one more round of tightening interest rates.
The hikes will boost rates to 4.75 per cent in the United States and four per cent in Canada, TD forecast.
What's in a name. More importantly how do you pronounce it. You know you've got a marketing genius screwing things up somewhere when a very senior executive of one Cendant's biggest assests isn't sure how to pronounce the name. Enough of my side bar.
Cendant spinoff on track, CEO says
Cendant real estate services division to become Realogy or (reel-o-gee)
Wednesday, March 22, 2006
Cendant Corp. remains on track to spin off its four businesses into independent publicly traded entities during the second and third quarters of this year, the company's chairman and chief executive, Henry Silverman, said Tuesday, according to reports.
During the company's investor day conference, Silverman said he doesn't anticipate any delays or roadblocks, barring some unforeseen external event, CBS MarketWatch reported.
"Obviously if the market shuts down for, say, bird flu or the SEC review process is elongated, hypothetically we could be delayed, but we don't expect either of these," Silverman said, according to reports.
Silverman said the company has analyzed thousands of contracts, relationships, systems and people to make sure the new companies will be fully functional on the day they're spun off, reports said.
The company's real estate company, Realogy, and its hotel company, Wyndham Worldwide, which represent about two-thirds of Cendant's earnings before interest, taxes, depreciation and amortization, or EBITDA, will be spun off in the second quarter. The company had announced this move in February.
Silverman reiterated his belief that the spinoffs are in the best interest of shareholders, reports said. He said Cendant considered selling itself but found that "it was too big for financial buyers and too diverse for strategic buyers," according to reports.
However, Silverman doesn't rule out the individual companies being sold after they're spun off, reports said.
"After the spinoff, each of the four companies will be an independent company and will be free to evaluate any potential transaction that is presented to it on the merits of that transaction." he said, according to MarketWatch.
Is that a hint Mr. Silverman. Is there a buyer in the wing for one of these spinoffs. Time will tell.
Here's an interesting NY Times article that gives a new perspective on the apparently now-deflating housing "bubble." As argued by the author, high home prices do not provide the greatest benefit to the greatest number of people -- sort of a utilitarian perspective. I wonder about his claims that only 1 in 10 homeowners have mortgage debt equal to 90% or greater of their home value. Regardless, even if true, if you're that one in ten, you've got a lot to fear from the bubble deflation, particularly if you've got an ARM that will require increasingly larger payments.www.lawofficeofcraigblackmon.com
I just authored a post on Rain City Guide (my second favorite real estate blog) that examines what can happen when transaction fails to close on the closing date. For you legal hardbodies out there, here are my authorities for that post: Willener v. Sweeting, 107 Wn.2d 388, 394-96 (1986); and Mid-Town Limited Partnership v. Preston, 69 Wn.App. 227, 233-35 (1993).www.lawofficeofcraigblackmon.com
In a very recent post I encouraged people to list their home for sale on craigslist. In today's news, there's a story about a lawsuit filed against craigslist for alleged violations of the Fair Housing Act. The plaintiffs point out that some posts contain clearly discriminatory language, such as "no minorities." The lawsuit seeks to hold craigslist to the same standards as those applied to newspapers. Craigslist responds by pointing out that it is an entirely different animal and the same standards simply cannot apply. An interesting argument on both sides -- time will tell whether craigslist can continue in its current form in regards to posts for real property. In the meantime, it's still a great way to get free market exposure...www.lawofficeofcraigblackmon.com
When you sell your house by owner (For Sale By Owner, or FSBO), one of the biggest challenges is marketing the home. Currently, there is no FSBO system comparable to the Multiple Listing Service (MLS), the database of properties for sale maintained by real estate brokers/agents. Thus, when you use an agent, you know that your home will be listed for sale in a "marketplace" visited by virtually every home buyer (as every buyer, even one without an agent, checks the MLS listings via one or more of the many search engines available on the internet). On the other hand, when you sell FSBO, you have no method for advertising your home on such a broad basis, unless you are also willing to pay for a flat-fee MLS listing (which, in turn, requires you to offer a percentage commission to the buyer's agent, if any, thus reducing your profit).
This is a conundrum indeed and one that will continue to hamper the development of the FSBO marketplace. In the meantime, FSBO sellers should avail themselves of the existing methods for marketing their home, including the community bulletin board of our time, Craig's List.www.lawofficeofcraigblackmon.com
As everyone else in the blogosphere has already announced and dissected, Zillow launched its web site last week. It certainly provides a very helpful tool for owners in determining the market value of their home. It should not be the only tool, however, as there are many other helpful resources. More knowledge is always better.
As for me, I've been scooped by every other blogger on the planet. This will teach me to take time out of the office...www.lawofficeofcraigblackmon.com
The For Sale By Owner Center Blog has a nice post on the continuing downward trend in the national housing market. As the blogger notes, a sliding market makes it that much more important for a home seller to price the home appropriately. I have a recent post that provides some helpful internet resources to assist a homeowner in determining the market value of the home.www.lawofficeofcraigblackmon.com
I just authored a post on Rain City Guide (a smokin' hot real estate blog) regarding a property's legal description and the importance of including that description in a purchase and sale agreement. Check it out.www.lawofficeofcraigblackmon.com
Here's an interesting article from the front page of yesterday's NY Times regarding an FSBO web page in Madison, WI -- FSBOMadison.com. As discussed in the article, this web page has about 20% of residential listings in the area. Given the average value of a home in the area, sellers saved more than $17 million in commissions last year by using this site.
In addition, 2006 will see the launch of several other sites that will, apparently, allow a user to search real estate data in a variety of ways. These sites (such as Zillow.com and Sellsius) will combine listings with a variety of other related data. They have significant financial backing and are generating a lot of buzz in the real estate industry. Time will tell whether they are of assistance to FSBO sellers.www.lawofficeofcraigblackmon.com
An interesting post regarding FSBO, with some nice comments, by a "soldier in the trenches of the Manhattan real estate" market. Trenches? Man, you know the market is expensive when people are paying to live in a trench...www.lawofficeofcraigblackmon.com
In yesterday's Seattle Post-Intelligencer (one of the two daily papers here in town), there was an interesting article on discount real estate brokerages. Discount brokers list a property on the Multiple Listing Service (the database of properties for sale maintained by real estate brokers, who in turn employ real estate agents) for a low, flat fee. The lower the fee, the fewer the services associated with the listing. As discussed in the article, there are several discount brokers in the marketplace.
I found the article particularly interesting, however, for a slightly different reason. In assessing the "changing paradigm," the article discusses the services typically provided by a real estate agent. The article quotes a local attorney, Matt Davis, at length. Mr. Davis works with the Demco Law Firm, which represents "some of the largest real estate brokerages in Washington," according to the Demco web page. They "provide on-call counseling and consultation to [the firm's] broker clients on all aspects of their business." Given that brokers are an important Demco client, it is not surprising that Mr. Davis emphasizes the services that can be provided by real estate agents (thus encouraging consumers to utilize them).
Regardless, Mr. Davis is certainly correct, to a certain extent: real estate agents provide valuable services to their clients. However, he takes the point a little too far. It is established law here in Washington that real estate agents can engage in the very limited practice of law by completing blanks in preprinted legal forms that were drafted by lawyers. Cultum v. Heritage House Realtors, 103 Wn.2d 623 (1985). Agents may not provide legal counsel or services beyond this narrow scope. The rationale is simple: agents lack the professional knowledge and skills expected of a practicing attorney.
There is certainly no definitive answer as to when a real estate agent crosses the line and engages in the practice of law. Mr. Davis indicates that an agent can protect a client's interests by understanding the pitfalls in a boilerplate contract and insuring that the contract is enforceable. Perhaps, but that sounds a lot like the practice of law, as the agent is interpreting the contract and taking steps necessary to render it enforceable. Mr. Davis further suggests that an agent is an appropriate "steward of the transaction," particularly where the transaction has soured and turned into a "war zone." This goes too far. If the transaction has soured, there is an actual legal dispute between the parties. Any guidance offered by an agent under these circumstances must, by definition, extend beyond the filling in of blanks in a preprinted contract. Accordingly, a buyer or seller should not look to an agent for guidance under these circumstances. Rather, an attorney should be consulted. Notably, by law an agent must persuade the client to consult with an attorney if the transaction possibly involves complicated legal issues. Cultum, cited above; RCW 18.86.040(c) and RCW 18.86.050(c), requiring an angent to advise the client to seek "expert advice" on matters "beyond the agent's expertise."
A real estate agent can and should work with the client in regards to valuation, marketing, and details associated with a transaction. However, if there is a legal issue, the client is better served by consulting with an attorney.
That said, and like Mr. Davis, I have an interest in this debate, as I represent buyers and sellers in residential real estate transactions. Furthermore, to be fair to Mr. Davis, I will alert him to this post so that he has an opportunity to respond.www.lawofficeofcraigblackmon.com
I came across this interesting post the other day, by an attorney in Chicago who handles estate planning and real estate matters. It provides another attorney's perspective on FSBO transactions.www.lawofficeofcraigblackmon.com
I am a firm believer in the For Sale By Owner ("FSBO") transaction. Although there are many obstacles to selling a home FSBO, a seller can generally overcome those obstacles with a little bit of research. For example, FSBO sellers often do not fully understand the true value of their home (and thus are unable to identify an optimum sale price). However, there are several web pages that can assist a seller in determining the anticipated market value of the property. HousingTracker provides real time market data for dozens of markets. The Washington Center for Real Estate Research, operated by Wasington State University, has market information for the state of Washington. The King County Department of Assessments maintains an eSales Search database that contains sale information for Seattle and the surrounding area (King County). Finally, web sites such as Home Pages, Redfin, and ShackPrices.com allow a homeowner (or home buyer) to search the neighborhood for a variety of data, including recent sale information. By using these sites, a homeowner is able to gain a better understanding of the true value of the home.www.lawofficeofcraigblackmon.com
As noted in earlier posts, there are both advantages and disadvantages to using an agent when selling (or buying) your home. If you decide to use an agent, you should understand the nature of an agency relationship, and in particular the implications of dual agency.
The term "agent" refers to a person who acts on behalf of another. The person for whom the agent acts is called a "principal." Thus, when you hire a real estate "agent," you hire that person to act on your behalf in buying or selling your home; you are the "principal." The law requires the agent to be loyal to the principal and to act in the principal's best interest.
In some instances, an agent may be acting on behalf of two different principals -- a "dual agent." When acting as a dual agent, the agent must be aware of his or her responsibility to each principal. If the principals have conflicting interests (such as negotiations between a seller, who wants the highest price, and the buyer, who wants the lowest), then it may not be appropriate for the agent to continue as a dual agent.
In Washington, statutes address the rules of agency as they relate to real estate professionals. These laws (RCW Chapter 18.86, "Real Estate Brokerage Relationships") spell out the scope of an agent's responsiblity to you as the principal. If you use an agent to sell your home, you will probably be asked to sign an Exclusive Sale and Listing Agreement. You should appreciate the nature of an agency relationship before you sign that agreement. In fact, by law an agent must provide you with a pamphlet entitled "The Law of Real Estate Agency" (which is simply a reprint of the applicable laws in RCW 18.86) before you sign a Listing Agreement or otherwise accept the agent's services (see RCW 18.86.030(1)(f)).
The standard form Exclusive Sale and Listing Agreement contains language that addresses the agency relationship. Specifically, the Listing Agreement as written allows the agent to represent both a buyer and a seller of the same property. This is permissible under Washington law (see RCW 18.86.060). However, you should seriously consider whether you want to permit your agent to represent the other party in the transaction. If you decide that your agent should work exclusively for you, then you should change the Listing Agreement before you sign it. Of course, you should also discuss this issue with your agent. Although the agent may indicate that he or she will not represent the other party, regardless of what the Listing Agreement says, note that your contractual rights are generally determined by the contract, not by comments made when the contract was signed. An attorney can assist you in understanding your rights under the Listing Agreement and can suggest changes to further protect your interests. Of course, you must consult with the attorney before you sign the contract.www.lawofficeofcraigblackmon.com
I recently spoke with a buyer who just purchased a conversion condo (it had previously been a rental apartment). The buyer was upset with the seller, as the seller had promised to do a significant amount of work on the unit prior to closing but had failed to do so. These promises had been made orally by the seller and had not been incorporated into the written purchase and sale agreement. Unfortunately, I had to tell this buyer that she probably did not have any legal remedy due to the presence of an integration clause in the purchase and sale agreement.
An integration clause in a contract indicates that the written agreement is the final and complete agreement of the parties in regards to the contractual terms. The written contract supersedes all prior or contemporaneous understandings and representations. Moreover, the clause requires that any modification to the contractual terms be in writing and signed by all parties. The law favors such a clause because it provides for certainty as to the rights and obligations of the parties to the contract. Most real estate form contracts (including the one used by this particular buyer) include an integration clause.
When I spoke with this buyer, she indicated that the seller had repeatedly promised to replace all of the old appliances with brand new ones. He also indicated that he would be doing a significant remodel of the unit, and in fact told her that she could not do an interior inspection of the unit as a result. He promised to repair the elevator and re-pave the driveway. The buyer made sure to make notes of all of these conversations. When she closed on the sale and moved in, she was understandably upset that none of this work had been performed.
Unfortunately for the buyer, none of the seller's promises had been incorporated into the original purchase and sale agreement, nor had they been included in the agreement as written (and signed) amendments. Given the presence of the integration clause, the buyer almost certainly would not be able to enforce these promises by legal action or obtain compensation from the seller due to his failure to keep them. Thus, this buyer learned the hard way that ALL relevant terms should be included in the purchase and sale agreement. If you fail to include certain terms, you run the risk of not having any legal remedy in the event that the other party fails to abide by those omitted terms. Ronald Reagan said, "Trust -- but verify." In the world of contracts, "Trust -- but include in the contract."www.lawofficeofcraigblackmon.com
Images.comGrowing debt has long been a concern in the United States, from individuals buying on credit to Washington budgets. But many economists are now warning that runaway spending and borrowing have the nation on track toward a major economic crash. By EILEEN ALT POWELL, Associated Press • Editor's note: Growing debt has long been a
Is your city overpriced?Forbes : 7/21/2005Cost of living -- from housing to the electric bill -- is going up just about everywhere, but these 10 cities have the rest of the country beat. Seattle tops the list. Again. Does your hometown make the cut?Once an overpriced city, always an overpriced city.That may not be how the old saw goes, but it's one of the things Forbes.com gleaned from the fourth
Knowing what happened during the stock market boom era, would you believe whatever Jack Grubman/Mary Meeker/Henry Blodget and others will recommend, knowing what you know today?Here, the housing bubble team will add the names of folks who are going on record about the existence (or lack of) a bubble. Over time, the masses will know who the liars are:Folks claiming that a bubble exists: Robert
From San Jose MercuryLatest numbers from Census indicate1. Rise in poverty for the fourth consecutive year2. Increase in number of people without health insurance to 45.8 Million3. Income has remained stagnantHow will this effect housing?
23% of all homes purchased in 2004 were for investment (Source : National Association of Realtors)13% of all homes purchased in 2004 were vacation homes (Source : National Association of Realtors)There are 72.1 million owner-occupied homes in the US, followed by 43.8 million second homes of which 6.6 million are vacation homes. There are 37.2 million investment units (compared to 72.1 million
Summary and Investment Conclusion The world may be in the middle of the biggest bubble in history. The bubble (e.g., property, stock, commodities) could exceed 50% of global GDP in value. The key cause of the bubble is that the major central banks failed to lower inflation targets to account for the combination of productivity acceleration due to IT and the new upward stickiness in wages due
Houston ChronicleOn their weekly NPR radio show, The Motley Fool , brothers David and Tom Gardner play a game they call, "What Did the Fed Chief Say?" Contestants are awarded token prizes if they can decipher the pronouncements of Federal Reserve Board Chairman Alan Greenspan and translate them into statements that ordinary Americans can understand.When a congressman once told Greenspan that he
One indicator shows some huge deviations from 35-year average By SCOTT BURNS Universal Press Syndicate Like the old real estate adage, "location, location, location," we have only one question these days. We just ask it in different ways.
Business Week Deed thieves, property flippers, equity strippers -- these con artists are duping banks and homeowners, and there are lots of them By most measures, Matthew B. Cox would appear to be a mortgage lender's dream customer. The 36-year-old former Tampa resident had once worked in the mortgage business, so he
By Bill Maher August 26, 2005 You don't have to remember history, but you do have to remember Thursday. The bursting of the Nasdaq bubble was only five years ago. People lost a trillion dollars. And here we are today with real estate prices across the country that could aptly be compared to Courtney Love: irrationally high and about to collapse. I don't want to say there's a
Why the bubble willl burst?1) Higher Interest Rates : As Interest rates rise, home owners who are already deep in debt are going to find it even more difficult to pay higher monthly payments. Most sectors of the economy are not growing, leading to falling wages and increasing costs of education, healthcare and rising prices. Squeezed between falling wages and rising interest rates, may owners
By Ilaina JonasNEW YORK (Reuters) - Bubble or not, the U.S. housing market has stayed afloat at a high altitude for the past two years.So what do experts look for as the first signs of fatigue in a frothy housing market?Mark Zandi, chief economist for Economy.com, said it won't be buyers who will disappear. Instead, he believes disgruntled sellers will bring the market to a halt."People will
By DAVID LEONHARDT & MOTOKO RICHReal estate-crazed Americans have started behaving in ways that eerily recall the stock market obsession of the late 1990s.In a version of day trading, some houses Naples, Fla., have been bought twice in a single day. Buying stocks on margin has morphed into buying homes with no money down. The over-the-top parties of Internet startups have been replaced by flashy
From The Economist Global AgendaHouse prices have been growing at a breakneck pace in many developed countries. This has encouraged householders to keep spending even during the global slowdown. But now that housing markets are looking soft, consumers may be forced to retrench AMERICAN homeowners, particularly those who have just bought their properties, are full of reasons
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Duh: heirs of billionaires drop cash on real estate. When Formula One heiress Petra Ecclestone was house hunting last year, she eschewed a "36,000-square-foot French-style mansion on Sunset Boulevard now listed for $49.5 million" because it wasn't "grand enough," according to the Journal, opting instead for Candy Spelling's 57,000-square-foot manor. [previously; WSJ]
The penthouse of yet-unfinished midtown building One57 just sold for somewhere in the range of $90M to $100M, making it the biggest deal in the history of Manhattan real estate. Aside from being extraordinarily wealthy, the buyer is apparently "a very nice family" as well as "someone that people would recognize," according to the building's developer. Curbed NY has a look at the penthouse floorplan. [New York Times via Curbed NY]
Photo: desire to inspire
Call me an infrequent flyer.
Looks like Ryan Seacrest didn't pay quite what Ellen Degeneres and Portia de Rossi wanted for their sprawling Beverly Hills compound: the Journal has reported the final sale at $37M. In what universe is that a steal? One where the property was originally hoping to snag a buyer for $60M. [previously; WSJ]
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Sure, there are real estate listings ripped from the pages of Architectural Digest, but then there's one Bethesda, Md., property that is, in the words of the brokerbabble, "Better Than Architectural Digest." Surely that mint-colored faux-finish in the master bedroom would make Arch Digest editor in chief Margaret Russell stand at attention. [previously; Curbed DC]
Former Dallas Cowboys quarterback Troy Aikman has found a way to unload part of his $24M estate that was first listed a year ago. He divided his land and just sold off one plot, but still hasn't found a buyer for the house, which is asking only $14M. [previously; Candy'sDirt via Curbed DC]
Photo: Contemporist
The one-time home of silver screen legend Judy Garland has come on the market in Brentwood, as a sheriff's sale. Whatever bad luck drove this place into the hands of the sheriff might have plagued Garland as well: this is where she lived while filming the ill-fated Valley of the Dolls. [Curbed LA]
Photo: Contemporist
Photo via Architizer
Movoto has just released an infographic charting out what the White House would cost if it were located in various American markets. Considering the median price per square foot in each metro area, the real estate trend tracker estimates that the 55,000-square-foot mansion would list for $110M to $115M if it were put on the market in D.C., $20M in Houston, and, of course, far more in expensive cities such as NYC, Los Angeles, and San Francisco. Play around with the interactive infographic below.
Meg Ryan and John Mellencamp are house-hunting in Manhattan and were seen checking out a few high-profile residences—both having swimming pools with varying degrees of privacy. Ryan, who has a proven track record of exhibiting exceptional taste in home decor, has also just put her Los Angeles mansion up for sale. [New York Post via Curbed NY; previously]
Oh, for those halcyon days of yore. For now, as we slowly creep toward the second half of 2012, there are fewer than 7,900 detached homes for sale in Maricopa County, an area (as both readers of my own blog know by heart) roughly the size of New Jersey. Or even Macedonia, for our more worldly readers.
Something for those who bought cheap in Baltimore and fixed up the place only to witness the housing bubble get hit: Nestpix, a home-reno app that allows you to document updates. Created by Baltimore Sun tech journo Gus Sentementes, it's one example of the city's tech boom and establishes proof that homes may be worth more than they seem. [Fast Company]
Factoring in things such as year-over-year median price appreciation, Realtor.com has named the country's top turnaround towns for Q1—those "leading the nation towards a general housing recovery." Seven of the top 10 are from Florida—but of course!—with Boise City, Ida., and Oakland, Calif., also represented. Phoenix, Ariz. comes in No. 1. [Realtor.com]
The Donald hasn't made a down payment on property on St. John - yet. But other people have, encouraged in no small part by significant price reductions.
Fall Out Boy bassist and Ashlee Simpson's ex-husband Pete Wentz has just bought a new place in Studio City, Calif., for $1.05M. The 2,000-square-foot home is surrounded by "meandering pathways" that lead to a spa, Japanese tea house, children’s play house, waterfalls, and koi pond. [Trulia Luxe Living]
Seven years ago today, the first post on Phoenix Real Estate Guy was crafted and published.
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Both the expectation for home prices and the percentage of those who think the U.S. economy is on the right path reached record highs in Fannie Mae’s April 2012 National Housing Survey.
TMZ notes that the girls of the hit show Glee have gone on a buying spree lately. Their language: "Naya Rivera—aka the Hispanic one" and her "co-star Jenna Ushkowitz—aka the Asian one" have both bought new Los Angeles pads. Not to mention Lea Michele and Kevin McHale —um, the white ones? [TMZ]
Ever get tired of endlessly riding in cars with buyers? Do you ever just feel like you need to be working smarter instead of working harder? Well maybe you can be. Partner with me and let’s open a FavoriteAgent.com relocation office together. Really. If we do it together, we can both add value and provide what the other can’t, and best of all, we can make a lot of money.
Imagine… What if instead of going into the office to begin the traditional real estate grind, you tried something brand new? You decide to take the thirty-second commute to your home office. You check your email and there are two brand new relocation leads that have come in overnight. You sit back in your chair, sip your coffee and begin to plan your day.
Matt Jones is the founder and CEO of FavoriteAgent.com, nationally syndicated columnist, broker, and best selling author of LCM: The Secret to Success in the New Age of Real Estate, The Ultimate Listing Presentation, Traffic: How to Sell Fast and Net More, Becoming a Mega-Producer, The Science of Online Marketing, 10 Steps to Real Estate Success, 20 Questions: Everything You Always Wanted to Know about Real Estate but Were Afraid to Ask, The Virtual Office Model, Max-Bang!, and The NEW Ultimate Listing Presentation. Jones’ North Carolina-based company has been profiled by major media outlets as an innovator and a pioneer in the industry, and CNN’s Pulse on America claimed FavoriteAgent.com is “changing the way real estate is being done in America.” This article is cross-posted in the following locations: BlogMattBlog.com, RealBlogging.com, NewsGeni.us, TheCommissionCheck.com, RevampedAgent.com, and now Amazon Kindle.
Photo: Contemporist
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I first spoke to Stan Humphries, chief economist at Zillow.com last year at the Inman Conference in NYC and found him to be very engaging. Yesterday he dropped by our offices and we had a conversation on the state of the national housing market. Fun! Audio MP3AudioPlayer.embed("f-html5audio-21", {soundFile: "http://thehousinghelix.com.s3.amazonaws.com/thehousinghelix/files/2010/12/2010.12.15-The-Housing-Helix-Podcast-Stan-Humphries-Chief-Economist-Zillow.com_.mp3"});Audio MP3AudioPlayer.embed("f-html5audio-21", {soundFile: "http://thehousinghelix.com.s3.amazonaws.com/thehousinghelix/files/2010/12/2010.12.15-The-Housing-Helix-Podcast-Stan-Humphries-Chief-Economist-Zillow.com_.mp3"});if (jQuery.browser.mozilla) {tempaud=document.getElementsByTagName("audio")[0]; jQuery(tempaud).remove(); jQuery("div.audio_wrap div").show()} else jQuery("div.audio_wrap div *").remove(); Please upgrade your browser
Planning on filing a real estate tax appeal? Dupage County property owners have an annual opportunity to appeal their assessments to the DuPage County Board of Review. The period during which an appeal may be filed begins on June 10th of the assessment year, and ends September 10th or thirty days after the publication of the township assessment roll, whichever is later.
The chart shows the market activity in Northbrook in the last 30 days based on information from the MRED Multiple Listing Service.
The topic of dream listings is oft discussed within the caverns of Curbed HQ—which properties or houses would be a real estate editor's dream to write about and, well, a real estate blog reader's dream to read about. Sure, there have been quite a few blockbusters to pop up within the last couple of years: the $90M Woolworth mansion in NYC, the $75M Tranquility estate near Vegas, Candy Spelling's $150M Beverly Hills mansion, and so on. But what about storied properties like Twin Palms, Frank Sinatra's Palm Springs getaway? You can rent that for a night, but it's not listed for sale. The White House was been valued at $250M and even has a page on Zillow, but obviously—well, duh. Continue the thread in the comments—anything and everything goes.
Home prices in Palo Alto, Calif.—where Facebook is headquartered—have risen by 10 percent since the beginning of the year. Inventory is down, perhaps because owners are "waiting for the IPO to pop so that they can list for higher prices." Through it all, Mark Zuckerberg rents. [AOL Real Estate; previously]
Photo via Freshome
Photos via Freshome
CoreLogic released its National Foreclosure Report for March, which provides monthly data on completed foreclosures, foreclosure inventory and 90+ day delinquency rates.
Photo via Curbed Hamptons: A shingle-style home in East Hampton, N.Y., asks $6.2M.
Please meet a growing trend for the nation's foreclosures (and no, it's not just turning them into rentals): teenagers throwing ragers in them and getting arrested. Says one property manager after the fact: "The house was trashed. Vomit, cigarette butts, bottles everywhere. I no longer list homes as 'vacant' because they just googled vacant homes, and they found it." [10 News via Gawker]
Madonna's been pretty good at keeping people on their toes lately, first with the rumors that she's trying to unload her Beverly Hills estate and now with news that she's been secretly renting a place in Water Mill, N.Y. The home is listed for $6M and spans 8,500 square feet. [previously; New York Post via The Real Estalker]
We are thrilled to announce that Dean Ouellette is taking the position of Vice President of Business Development at Thompson’s Realty effective immediately.
Rendering via DC By Design Blog
Life can change in the blink of an eye.
The chart shows the market activity in Glenview in the last 30 days based on information from the MRED Multiple Listing Service.
The chart shows the market activity in Glendale Heights for attached homes & condominiums in the last 30 days based on information from the MRED Multiple Listing Service.
The chart shows the market activity in Hinsdale in the last 30 days based on information from the MRED Multiple Listing Service.
The chart shows the market activity in Park Ridge in the last 30 days based on information from the MRED Multiple Listing Service.
The chart shows the market activity in Franklin Park in the last 30 days based on information from the MRED Multiple Listing Service.
The chart shows the market activity in Norridge in the last 30 days based on information from the MRED Multiple Listing Service.
The chart shows the market activity in River Grove in the last 30 days based on information from the MRED Multiple Listing Service.
U.S. Secretary of the Treasury Timothy Geithner (right) told a subcommittee of the Senate Appropriations Committee March 28 that he believes officials at both Fannie Mae and Freddie Mac favor mortgage write-downs for underwater borrowers, despite resistance from the agencies' regulator, the Federal Housing Finance Agency, Bloomberg reported.
The chart shows the market activity in Prospect Heights in the last 30 days based on information from the MRED Multiple Listing Service.
The housing market started off the new year with a thud. Home prices dropped for the fifth consecutive month in January, reaching their lowest point since the end of 2002.
The chart shows the market activity in Deerfield, Illinois in the last 30 days based on information from the MRED Multiple Listing Service.
Can you believe all that you hear about the "Housing Recovery" Some of us wonder "What Recovery, its Housing Hype".
The chart shows the market activity in Gilberts, Illinois in the last 30 days based on information from the MRED Multiple Listing Service.
The chart shows the market activity in Norwood Park in the last 30 days based on information from the MRED Multiple Listing Service.
Imagine this…
What you are about to read may very well blow a few minds across the real estate Internet space. Or not. We’re about to find out…
It doesn’t happen very often, but occasionally a home seller will decide that they don’t really want to sell their home after all.
Pay no attention to the silly article title. It’s purely a play on what is making news today.
Olakunle Okubote (left), 50ys - 03/11/1961, of Broughton Avenue, Finchley N3 3EH was jailed and forced to hand over more than £23,000 on 24 February, following a five-week trial at Wood Green Crown Court.
Robert Coyle, Snr - Coutesy of Philly.comAccording to the Indictment, Coyle, through his business entities, borrowed more than $3 million from East River Bank (“ERB”) and more than $6.6 million from Republic First Bank (“RFB”). Polonia Bank was a 49% participant in the ERB loans after settlement. The purpose of the loans was purportedly to refinance existing loans, make improvements on some of the properties Coyle owned, and/or to allow Coyle to pursue other real estate opportunities. Coyle pledged approximately 71 properties to secure the ERB loans and approximately 117 other properties to secure the RFB loan. The banks anticipated that the loans would be repaid through rental income that Coyle was collecting and, if necessary, through the sale of the collateral properties.
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This is not something that will only be asked by native New Yorkers to the rubes visiting from out of town.
Murphy (pictured left) was the key participant in this nationwide enterprise that includes real estate in many states with the most activity occurring in Ohio, Michigan, Pennsylvania, Missouri, and Texas. From 2005 to 2010, the purpose of the enterprise was to make a quick profit by selling houses in Cuyahoga County, and the enterprise did so by filing forged deeds and engaging in related conduct. Of the 235 houses sold in Cuyahoga County, 186 properties were in Cleveland, 31 properties in East Cleveland, 5 properties in Warrensville Heights, 4 properties in Euclid, 3 properties in Cleveland Heights, 3 properties in Shaker Heights, 2 properties in Maple Heights, and 1 property in Garfield Heights. 96 properties fell into Tax Foreclosure for a total tax delinquency of $1,032,849.84.
Courtesy of Buffalo News.comAssistant U.S. Attorney Trini E. Ross, who handled the case, stated that Macakanja, in her capacity as a housing counselor employed by HomeFront, Inc., inappropriately requested money from clients. The defendant told HomeFront clients that the money would be used toward loan modifications to prevent foreclosure on their homes. However, after receiving the funds, Macakanja used the money for her own personal use, including gambling, and failed to obtain the loan modifications for the victims. A total of 136 HomeFront clients were defrauded with losses totaling approximately $300,000. In addition, Macakanja also obtained federal grant monies from the Buffalo Urban Renewal Agency (BURA) for HomeFront clients. On two occasions, she diverted $2,000 worth of BURA money to pay her own personal mortgage.
Following an investigation prompted by consumer complaints, the department’s Division of Finance and Corporate Securities (DFCS) found the company had closed its manufacturing facilities in February 2011 but was still accepting customers’ deposits for home purchases. The company collected $500,000 through 26 deposits for the purchase of structures that were never built. Fuqua Homes accepted the deposits between October 2008 and August 2011.
Are you ready for a real estate investment conference that is not on big sell and spam fest? Are you tired of every speaker from the stage pitching their product instead of teaching you?
Typically when you think of a battle between a house and a Prius, you add a dose of a drunk driver and a garage and you are done… But not today.
When buying a home, one of the key components is the down payment. Back a few years ago when the housing bubble was hitting it’s peak, there were no money down loans floated out there, but those are ancient history. Now you need hard money to make the loan.
As real estate professionals, your goal is a healthy and vibrant real estate marketplace. Lots of selling and buying of homes is a good thing, as is a healthy credit report and sufficient cash on hand by your buyers and large amounts of home equity with your sellers.
According to CoreLogic the number of homes sold as reported by the National Association of Realtors could be off by 20% over the past 5 years.
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Shopping for your next second-home property? Here's an idea for you. The Economist's Online Fairs business just annouced that they will host an online event that showcase listings that represents a unique collection of the world's most exclusive properties. You can check these properties out from the comfort of your home. How cool is that?
Ecotwist_interview_with_Ruthie_Mundell_Comm_Forklift.wav Listen on Posterous
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This chart illustrates the difference between an investment made on January 1, 2000 in one of the major U.S. stock indices and one made in either a San Francisco house or condominium. It's simply a sample analysis to show how real estate usually appreciates over the longer term: numbers may change dramatically according to the period used in the calculation.
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Twitter Soup for the Soul is a 122-page mashup of original photos and Twitter posts and an exercise in online transparency. The e-book is $9.97 -- half the author's proceeds will be dontated to CARE through theWeb Women Giving Circle. Frances Flynn Thorsen is a Twitterholic, blogger, journalist, blog coach, and author who writes about real estate, social media, law of attraction, and prickly pear cactus jelly. This is not a tutorial about how to use Twitter for microblogging ...
HUD Homes comprise a huge slice of the foreclosure property pie. But there are differences between HUD Homes and bank homes that matter to buyers and their real estate agents! This is a FREE Webinar for home buyers and real estate agents.
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Used GoGoPin's new browser-based ad designer to create this call for nominations for "Best of Breed" money-saving applications for home buyers and sellers following the National Association of Realtors convention in Orlando, November 7-10, 2008. Watch this one minute screencast for more information on the proposed technology debriefing. Should we meet in person in Boston, like real estate round tables and technology debriefing hosted in the past by The Real Estate Cafe, or online so anyone can participate?
As the housing market enters the final quarter of 2008, The Real Estate Cafe is contacting new and long-time clients to get an update on their home buying plans. Can you believe that one member of our 1,000 Click Club has viewed 6,247 MLS pages via The Real Estate Cafe’s MLS access system during the past 2.3 years? More than half of those page views (3,847 pages) have been since the start of 2008 and about a third (1,270) were during the 3rd quarter. If you're bargain hunting during the final quarter of 2008 and early 2009, can The Real Estate Cafe help you save money by serving you "a la carte"?
We are happy to offer a playback of Week One Webinar, Develop a Blog Business Plan.
Distressed homeowners who want to KEEP their homes are a forgotten class. Real estate search giant Trulia is the latest mediatainment player that sees the distressed home market as a pool of buyers and sellers and panders to the hungry investor. Never mind the hundreds of thousands, maybe 2 million, homeowners who would prefer a choice to remain in their homes!
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Another good article from Bernice Ross of Inman news... The premise here is that people are naturally attracted to people like themselves. So if you want friendly clients, you should be friendly, if you want funny clients... well I think you get the idea....take the quiz!
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