Sunday, December 30, 2012

Yun, Chief Economist for N.A.R. Does Not Feel Doom Due to Fiscal Cliff


It was a great article read this morning - Copied and Pasted exactly as written on Housing Wire this morning ----------------------- By Kerri Ann Panchuk
"A failure on the part of the nation's lawmakers to reach a deal on the fiscal cliff does not spell automatic doom for the mortgage industry or for families wanting to take on new mortgages, according to Lawrence Yun, chief economist for the National Association of Realtors.
However, it creates more uncertainty — something the mortgage industry and homeowners have grown weary of.
President Obama and Congress were working Friday on a last-ditch effort to save Americans from tax hikes set to take effect in January, but issues related to housing are most likely postponed at this point.
Two issues tied to fiscal cliff negotiations and deficit reduction talks have a direct impact on the mortgage industry.
First, the Mortgage Forgiveness Debt Relief Act expires at year-end without a move by Congress to extend it.
The act was originally passed in 2007 so struggling homeowners could go through short sales, loan modifications and other resolutions without getting zapped with taxes on forgiven debt.
Second, policymakers have been throwing around the idea of tossing out the mortgage interest tax deduction to help reduce the nation's deficit while protecting most Americans from tax hikes. Such a move would take away a popular tax benefit for homeowners.
Lawrence Yun with NAR told HousingWire "it's very quiet in Washington, D.C., in terms of the key people trying to make compromises."
And while NAR and other housing industry groups lack certainty, Yun says a proposal to eliminate the deduction on mortgage interest is probably far removed from the negotiating table at this time.
He expects Congress and the president to try to come up with a temporary solution in the next few days to spare America from going over the fiscal cliff.
And if they compromise on an initial solution, Yun anticipates a more extensive agreement over how to reduce the nation's deficit next summer. That is when the mortgage interest tax deduction could end up back on the bargaining table.
Even then, Yun sees it as a difficult item for lawmakers to eliminate.
"I believe the mortgage interest tax deduction is one of those issues where it impacts so many people. It is not a special interest. I don't see the deduction being changed in any measurable way in the grand bargain."
As for the Mortgage Forgiveness Debt Relief Act, the expiration is at hand, bringing a bigger sense of urgency.
But Yun says the extension of it has bipartisan support and he anticipates a final compromise although that may come sometime in mid-January with provisions to make it retroactive.
He anticipates a two-year extension will be applied when that measure is finally pushed through. "I am less concerned about that," he said. "There is no hostility to the mortgage forgiveness debt relief bill."
But Yun admits, homeowners worried about losing mortgage interest tax deductions may still view a lack of closure on that issue as too much uncertainty, causing them to hold off on buying a home.
"For some homebuyers they may want to wait it out until they see what is in it (the grand bargain) and what is not." "

Thursday, December 27, 2012

Thoughts For 2013

This is one Toad's Wild Ride we're having in Southern California Real Estate! And, the ride will continue.

This post is my opinion of what to anticipate in our housing market. Here in Santa Clarita Valley and San Fernando Valley.

January 2013 is just a few days away. Inventory is frighteningly low, pushing prices up. Mortgage rates are way lower than any 'historically low' I've seen in a 1/2 century, and expected to stay that way through 2014! The fiscal cliff is now being called the slippery slope and we are still wondering if the Mortgage Debt Relief act will be extended.

So, really, what do we do, where do we go, what's gonna happen? Thoughts and opinions.

I believe we will continue to see more traditional sellers come on the market. Hopefully slowly as the faster they come the slower we will see appreciation. Expect to continue to see an upward trend, here in California, in home prices. With rates staying low, the market will continue to have a bounty of buyers grabbing properties left and right. Multiple offers combined with minimal inventory pushes pricing up.

Building permits have been rising. The Newhall Ranch project along the 126 and 5 freeway corridors is closer to breaking the infamous ground. When new homes are built, homeowners sell the current as they want shiny and new. More homes purchased and sold will, of course, help our economy.

Foreclosures? In the judicial states there was a huge stall, those are starting to catch up, and more homeowners are getting foreclosed upon. In California, a non-judicial state, we had our stall with the Robo-Signing settlement. That's been moving along nicely. The number of REO's has significantly reduced. Short-Sales and Loan Mods have helped ease the distressed property inventory tremendously.

For many, however, the big question is that Debt Relief Act. Will it be extended? When will we know? And, if it doesn't....what's going to happen to all those homeowners trying to Short-Sale, Loan-Mod, or on the Foreclosure freeway?

Opinion: I do think it will get extended. It's been in the president's budget for quite some time. Attorney Generals for 41 states have been urging Congress to sign an extension. Too many homeowners are still in the midst of housing correction to have it not to get extended. I've spoken to, listened to, and read from enough bankers, Realtors, politicians, etc....it really would shock the heck out of me (and them) if it did not get extended for at least another couple of years. However, I doubt we will know for sure for several more months. And if ,God Forbid, it doesn't get extended...it will cripple many homeowners. Frighteningly so.Emotionally, financially....crippling.

The Fiscal Cliff, hmmm, I like that it is now called the Slippery Slope and I only comment on it regarding housing. And, the bottom line is this ~ Housing helps economy. No if's and's or butt's about it. With the housing market, I expect not to be 'normal' again for 5 more years. Of course, we never really seem to have been normal in the past 20 years but we do strive for normalcy in the housing market. Why? Because, housing stimulates the economy. More money moving around, more being bought, stimulates our economy.

Bottom line.....we've got a little ways to go. A lot say we are 1/2 way there. I do feel that we've got 3-5 more years of struggling sales, challenged homeowners, difficult buyer conditions.

Remember, these are just thoughts from a 10 year veteran Realtor that has been working with hundreds of homeowners over the years. We'll get through this, we always do. Some pain along the way, many challenges too, but we will overcome.

We have no other choice but to move forward.

Saturday, December 22, 2012

Service Release Dates on Short-Sales

It seems to be the new thing to add to Short-Sale problems. Just when we are getting them a bit easier to manage the newest dilemma is if the bank sends the homeowner a letter stating they have a Service Release Date on their loan.

A what? A Service Release Date. The loan, that delinquent loan, the one I've been working on getting Short-Sale approval for you on? It's being transferred to a new Servicer....a new bank, a new lender....a new set of problems to get your short-sale approved.

It's hit me twice in the last two months. One with Bank of America. Fortunately my SS contact kept pushing to get approval for us even though the release date was looming. Then, the homeowner gets a letter stating they are not going to do the release. Borrower calls me and we both agree...."It's a miracle" So onward and forward, we get our approval letter and open escrow.

Another I just got with CITI. No letter to the homeowner....well, not yet. I just called to check status, I'm a total nag on Short-Sales, and the rep says "Oh, by the way....there's a Service Release Date of 1/15/2013" I pause....put the phone closer to my ear....and ask her to repeat herself. Ugh. This one is particularly challenging and the last thing my clients need to hear is this news.

But, I don't just lay back. Nope. I get out my little list from my CDPE (Certified Distressed Property Expert) website, of which I am a member, and call the escalation number. Calmly, softly, patiently...I explain the situation. 45 minutes later with Diana, I speak with Greg, and then lovely Diana calls me back again. Total time with CITI, maybe about 1 1/2 hours on the phone. At this point, they are sending messages to the team lead to try and keep pushing our approval forward so that hopefully we have a written approval before it gets released to OCWEN.

CITI swears all our documents will go to Ocwen so we don't have to resubmit. And, they state that we will continue where we left off without losing time...once it transfers. But, right now, my negotiator says he doesn't have the time to bother to look at our file since the release date is looming. But, my lovely Diana is pushing her team lead to get us another one assigned and keep working on it til it drops out of their CITI system. We'll be in a much better position to move forward if the approval letter has been issued prior to the transfer......supposedly....that's what I'm hoping for.....

Or maybe, just maybe, we'll have another miracle. The 2013 miracle. Cross your fingers, say your prayers, this family could really use a miracle just about now.....


Monday, December 17, 2012

Ask for HIN's and HAFA Updates

Certified Distressed Property Expert, this designation keeps me informed of almost everything related to Short-Sales. And, trust me, changes almost daily.

New items to share:

HAFA Update is allowing many cooperating banks to make a 'Pre-Determined Hardship" As long as the borrower (home owner) is more than 90 days delinquent and their FICO is below 620, they almost consider it an automatic approval. Decision is to be made in 30 days tops.

And, one, not to forget:

HIN. ~ Homeowner Incentives. When people got foreclosed on they were frequently offered 'Cash for Keys' to vacate. Banks have been offering for a while these HIN.'s to complete the sale of homes via Short-Sale instead of letting them get foreclosed upon. Not to everyone, they have to approach you. But, doesn't hurt to ask. Just reminding you that if you get something from your lender that says they will pay you to do a Short-Sale, it may not really be a scam.

Amount of HIN's these bank reps have said they are offering:

Bank of America ~ 3k to 30k
Citi Mtg ~ 3k to 45k
Wells Fargo ~ 3k to 20k
Chase ~ up to 35k

The 3k is the HAFA relocation. Anything above that is when a proprietary Short-Sale is completed. Not a HAFA short-sale. Not everyone will be eligible, again, the numbers have to work right. But, never hesitate to ask.



Wednesday, December 12, 2012

An Appraisal Story

One of my listings in Santa Clarita is a little different from most. Santa Clarita is the town of mostly track housing, cookie-cutter, fairly easy to find 'comps' for.

This one is a tad different. And, for me, determining a list price I had to get creative. Pull from out of the 'track', add in for extra items, take away for less, adjust for this and that. Lots of adjusting for this and that!

Fortunately for my sellers it is a standard sale and it is a sellers market with the lack of inventory. We did have multiple offers on the home and selected one that appeared would work best to close escrow.

Then, the appraiser calls.....to schedule their appointment to view the property. Grumpy right from the start. 'I'm too busy to come out until next week'.....'It's a duplex? Oh, ugh, no one told me that on my sheet.' 'There are no recent comps?' 'Oh, Ugh again!' So, needless to say, I am really dreading the meet with this one.

I get my documentation together since the assessors records are all crazy. Two story noted on a one story unit. Square footage about 400 short. But, my seller overnights me the plans, sends me the inspection sign off sheets for the remodel, I pull more comps than I could possibly need....I'm Ready!

With a smile on my face, standing on a gravel road in my tennies, paperwork in hand....I meet the lovely little appraiser in her flashy red car and high-heels. 'This is a gravel road?' 'Ugh, no one told me that' I smile and tell her I wondered if she would see that in the MLS and wear flats....big smile here. Laughing inside.

So, she then tells me what I already know. 'This is going to be a really hard appraisal. I really wish I never took the assignment.' But, I see she has done a lot of her homework, she has gone out of the normal boundaries, and she really is ready to do the best job she can do.

She turned out to be a rather nice, funny lady. I enjoyed her chatter, and she said the property was definitely nicer than she had expected.

I came back to my office and pulled even more comps, older ones that she would need to adjust for age. But, I doubt we'll have any problem.

And, if we do, I'm armed with more info.....and, 
with two additional back-ups 'chomping at the bit',

 there's no reason to make any price adjustments if the appraiser won't make any value adjustments either.

Friday, December 7, 2012

Freddie Mac's Buyback Strategy & Fraud Rising

Freddie Mac says they are going to be ramping up their re-purchase demands going back to 2004-2005, that's before the housing crisis.

The GSE informed large servicers that they may require them to buy back defaulted loans originated in years prior than what they originally had said as 2006 forward.

This was unexpected, but Freddie has always had the authority to review files when loans stop performing. Doesn't matter when they were originated.

They, the GSE, say that how and why the files are reviewed is adjusted occasionally to make sure they have the the data needed to insure QC and reduce taxpayer exposure to any risk.

Of course, this makes bankers concerned. A quote from one : "That's the reason the mortgage business gets harder to love, because you don't know whether or not you're done with it." Seems to me if it's done right from the start, you'd never have to look back at it and see if the love is still there.

And, on the 2nd note of my title ~ go figure....Mortgage fraud is already on the rise and Short-Sale fraud is expected to increase!

What with unemployment at this rate and mortgage rates so low, of course the mortgage fraud would be on the rise. Don't work there anymore but have a friend that can say you do? Sure, put on your ap you still are employed. Anything to get today's low rates!

Short-Sale fraud. I can see it, well I sure think I can. As an example: A 'flip' property. We check to see the last sale date, notice it was a SS, see that it went for way under value....no enhancements to property, not taking FHA loans, same agent that had the listing before, brought the buyer and has the new listing?

 I'm thinking there was something a little shady going on.





Tuesday, December 4, 2012

FHA Anti-Flip Waived for Another Two Years

The anti-flip waiver for FHA buyers was extended last week through 2014.

What does that mean to you, you ask?

Back in 2003 FHA put a policy in place making a standard 90-day Anti-Flipping rule. You just couldn't purchase a home that had been bought less than 90 days ago if you were using FHA financing for your loan.

With the housing crisis, FHA made it's first waiver of the rule, with a few stipulations still in place of course, in 2010. Since that time they have insured eleven billion worth of mortgages on over sixty-two thousand homes.

Requirements that continue:

1) All purchases must be 'Arms-Length' with no one person involved having a relationship with another in the purchase. Lenders have to insure that the seller actually does hold title (I know seems like a no-brainer, but remember, double escrows have occurred). And, the property in question should not have been 'flipped' in the prior 12 months.

2) There should not be more than a 20% increase in the sale price than what the seller paid for it unless there is documentation showing the work done to reflect that larger price difference.

3) An inspection must be completed and if there are any structural or healthy & safety defects, those repairs must be completed prior to close of escrow.

So, again, what does this mean to you?

Extending the anti-flipping waiver for a full two years allows investors and buyers the opportunity of knowing they have some definite time to complete sales and re-purchases. Since so many buyers are utilizing FHA financing, the waiver opens up more home possibilities to them in a time when inventory is so low. It also keeps the investors buying these homes, doing work that an FHA buyer would likely not be financially able to do, and therefor again allows more homeowners a purchase plan. Investors that buy homes are sometimes paying significantly higher, short-term, interest rates. So, the faster they know they can re-sell, the more likely they are to buy, re-hab, and re-sell.


Thursday, November 29, 2012

Santa Clarita MLS Stats

MLS stats for Santa Clarita Valley ~ Including Acton, Agua Dulce, Canyon Country, Saugus, Newhall, Castaic, Valencia, Stevenson Ranch & Val Verde.

ACTIVE Listings: 295
Short-Sales: 47
REO's: 26

PENDING or taking BACK-UP Offers: 1027
Short-Sales: 729
REO's: 64

CLOSED sales in the last 30 days: 289
Short-Sales: 141
REO's: 25

Less closed, but don't forget we did have a holiday. More traditional sellers on the market.

Prices are going up, inventory is going down. Mortgage rates are staying low. 

As I keep saying, if you can find a home to buy, grab it! 


Sunday, November 25, 2012

Current Push To Extend The Debt Relief Act

FORTY ONE state attorney generals are urging congress to extend the Mortgage Forgiveness Debt Relief Act past the current expiration date of 12/31/12.

It is spearheaded by 4 state AG's with the strength of the Robo-Signing Settlement behind them. It is noted that with the 25 billion settlement many homeowners that are in the midst of short-sales, loan modifications, and principal reductions could all be stuck with a tax bill in 2013 if there is no extension.

It has been in the Obama 2013 budget for quite some time but we all know that budget has not been finalized, and who knows when it will be.

I've got mixed feelings about extending it. Rip the bandaid off and be done with it? But, as we are still teetering on the edge of recovery, I am now leaning towards one more year. I think it's taken so long to get the process of housing assistance moving in the right direction, at a more appropriate speed. The thought of pulling that bandaid of the Debt Relief Act off now, may just make the wound heal at a significantly reduced pace than what we were starting to see recently.

Rip it off quickly, peel it back slowly....what are your suggestions?

Tuesday, November 20, 2012

Think The Fiscal Cliff Will Take Away Your Mortgage Interest Tax Deduction?

It's big news this last few weeks, calling it the Fiscal Cliff. Yes, we are on the edge.

Regarding Real Estate and our favorite of homeowner deduction, this is the skinny on what changes may occur. Although I don't think it will be completely taken away, the majority of Americans will be affected by it very minimally even with the suggested changes.

Examples here of what it may do if it passes:

Make less than 40k a year and you normally save about 100 bucks with that write-off. Not a lot of that earning bracket even itemizes their deductions so they don't get the cash. Under 250k? average savings on your taxes is between 1200-2600/year. Nice little chunk of change. Those big earners of over 250k annually, and ALL of them itemize, average tax break is 5400.

Several suggestions for changes to the mortgage interest deduction, which, right now, reduces income tax revenue almost 80 billion per year, are as follows:

1) Cap the deduction at 500k of the homes value and only for primary residences.
2) Limit the overall deduction to just 25k worth of mortgage interest.
3) Eliminating it for any tax payers that earn 250k or more.
4) Removing the benefit for 2nd homes.
5) Take the deduction away entirely.

So, be aware of the interest deduction, the fiscal cliff too. 







Thursday, November 15, 2012

Plenty of Foreclosures Cancelled In California

By now most of us have heard about the California law that goes into effect in 2013, banning the dual-tracking by lenders. Which means they couldn't move forward with foreclosure proceedings while a borrower was working on a loan modification or short-sale.

The amount of foreclosures that were cancelled in California bumped up to 62.1 percent from September to October and almost 37% over a one year period.

We don't know what this will do the recovery. Consider that the banks seem to be working harder at getting mods and short-sales done...but, what if they aren't approved, aren't acceptable to the borrowers....does that mean the foreclosure timeline will start all over again and therefor the housing recovery be stalled even further?

I would have to say yes...and then we'd certainly be working with more distressed properties.....still.....



Tuesday, November 13, 2012

National Association of Realtors Forecast for Housing and the Economy


Great article I read this morning that I wanted to share, word for word, with my blog readers!


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NAR Makes Forecast on Housing, Economy

The National Association of Realtors (NAR) offered market projections into 2014 during a forum at the 2012 Realtors Conference and Expo.

NAR chief economist Lawrence Yun says he expects the market share of distressed sales to fall from about 25 percent in 2012 to 8 percent in 2014, according to a release on the forum.

Mark Vitner, managing director and senior economist at Wells Fargo, was one of the speakers at the NAR forum. Vitner compared distressed homes to an after-Christmas sale stating, “most of the best stuff has been picked over, but make no mistake they’ll be with us for a while.”

The housing recovery was expected to continue so long as credit does not further tighten and a fiscal cliff is avoided.

The rise in home prices should also stay. Yun predicted a 6 percent rise in the median existing-home price in 2012, with another 5.1 percent increase next year and comparable gains in 2014.

Existing-home sales were projected to move higher year-after-year: a 9 percent increase this year to 4.64 million, 5.05 million in 2013, and 5.3 million in 2014.

Mortgage interest rates were expected to eventually increase to an average of 4 percent next year, and inflationary pressure should cause rates to go up to 4.6 percent in 2014, the NAR said in the release.

Yun projected a higher Gross Domestic Product (GDP) in the coming years, with GDP expected to be 2.1 percent this year and rise to 2.5 percent in 2013. The unemployment rate should also fall to about 7.6 percent in 2013.

Yun stressed that the “projections assume Congress will largely avoid the ‘fiscal cliff’ scenario.”

“While we’re hopeful that something can be accomplished, the alternative would be a likely recession, so automatic spending cuts and tax increases need to be addressed quickly,” Yun added.


Friday, November 9, 2012

35 Million Committed to Soldiers By Wells Fargo


New hiring, donation of REO properties, and financial education training....to the tune of Thirty-Five Million dollars from Wells Fargo. Nice!

The properties will be given to non-profit organizations that serve the military. Money will be set aside for ways to help soldiers via 'philanthropic endeavors'.

November 14-30, WF customers can donate via their ATM's as well. The donations will end up going to various organizations that assist the military.

Short, sweet, good news!






















Tuesday, November 6, 2012

FHFA's 3rd Winner for REO Bulk Sale

Colony Capital is the big winner in the SW states it would appear. They were able to purchase 970 properties from Southern California, Arizona and Nevada. They are a private firm out of California.

Wonder what kind of moolah FHFA got for the sale? 176 million smackeroos. Value was apparently placed at 156.8 million. Hmmm, could you say there was a profit made by FHFA? Hardly. Surely, the Colony Capital people see extreme value here.

California Association of Realtors was strongly opposed to the bulk sales saying that we, here in Cali, need homes for buyers to purchase. And, they feel that it will stall the housing recovery by not having those homes available for sale through normal channels.

I'm not sure I complete agree with C.A.R. I believe we definitely need homes for sale, but I also believe by selling these in bulk we can get the REO's cleared out faster.

What's your opinion on REO bulk sales?






Friday, November 2, 2012

Ways To Help Keep Your Rentals Filled...If You Didn't Already Know

We're all hearing that housing seems to be rebounding. A ways to go, of course. but it is looking better.

As a local Realtor I do have people that purchase investment properties, myself included. So, just a tidbit of reminder information to help keep your rental properties occupied. Once more people start buying again, those after Short-Sale or Foreclosure, we may have a few more vacancies. I know, I know, I keep harping on that. I'm a nag. 


Regardless of my naggyness (is that even a word), if you'd like, please see below for some suggestions:

1) Similar to when we list a house for sale ~ Use lots of PHOTOS on your advertisements. People respond to photographs much better than the written word. And, it will help eliminate the ones that, in person, find the property not appropriate to them. Saves you time...time = money.

2) Video ~ yup. Take a video, you can do it! When it's vacant, unless there have been major changes, take it when there is no one living there. You can use the same one over and over again. People love those videos and using the same one again? Hmmm, saves time....time = money.

3) Start the search for new tenants before your unit is vacant. And, if your current tenants are good ones, OMG, ask them first if they know anyone. They can be a great referral source for you.  Work with your tenants, if they are the good kind, to show your property. They don't generally like when someone comes if they are out, so arrange it when they are there. They can practically advertise it for you....again, if they are good and happy tenants. This will help to avoid a long time with the unit being empty....time = money.

4) Use advertisement sites wisely. Make sure you are getting the quality prospective tenants from whatever advertising you are doing. Always ask the applicants where they saw your ad. Take note of where they come from and learn by the quality of applicants you get which places to stop advertising. Less time spent on those sites that don't refer quality. ....time = money.

Tuesday, October 30, 2012

Top 10 Things to Know about the Infamous 3.8% Tax


This isn't my opinion talking here. I've copied and pasted from the National Association of Realtors for you clarity in understanding how/if this tax effects Real Estate transaction.


1) When you add up all of your income from every possible source, and that total is less than $200,000 ($250,000 on a joint tax return), you will NOT be subject to this tax.

2) The 3.8% tax will NEVER be collected as a transfer tax on real estate of any type, so you’ll NEVER pay this tax at the time that you purchase a home or other investment property.

3) You’ll NEVER pay this tax at settlement when you sell your home or investment property. Any capital gain you realize at settlement is just one component of that year’s gross income.

4) If you sell your principal residence, you will still receive the full benefit of the $250,000 (single tax return)/$500,000 (married filing joint tax return) exclusion on the sale of that home. If your capital gain is greater than these amounts, then you will include any gain above these amounts as income on your Form 1040 tax return. Even then, if your total income (including this taxable portion of gain on your residence) is less than the $200,000/$250,000 amounts, you will NOT pay this tax. If your total income is more than these amounts, a formula will protect some portion of your investment.

5) The tax applies to other types of investment income, not just real estate. If your income is more than the $200,000/$250,000 amount, then the tax formula will be applied to capital gains, interest income, dividend income and net rents (i.e., rents after expenses).

6) The tax goes into effect in 2013. If you have investment income in 2013, you won’t pay the 3.8% tax until you file your 2013 Form 1040 tax return in 2014. The 3.8% tax for any later year will be paid in the following calendar year when the tax returns are filed.

7) In any particular year, if you have NO income from capital gains, rents, interest or dividends, you’ll NEVER pay this tax, even if you have millions of dollars of other types of income.

8) The formula that determines the amount of 3.8% tax due will ALWAYS protect $200,000 ($250,000 on a joint return) of your income from any burden of the 3.8% tax. For example, if you are single and have a total of $201,000 income, the 3.8% tax would NEVER be imposed on more than $1000.

9) It’s true that investment income from rents on an investment property could be subject to the 3.8% tax. BUT: The only rental income that would be included in your gross income and therefore possibly subject to the tax is net rental income: gross rents minus expenses like depreciation, interest, property tax, maintenance and utilities.

10) The tax was enacted along with the health care legislation in 2010. It was added to the package just hours before the final vote and without review. NAR strongly opposed the tax at the time, and remains hopeful that it will not go into effect. The tax will no doubt be debated during the upcoming tax reform debates in 2013.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Just an FYI for ya!

Friday, October 26, 2012

'Shadow' Inventory Can Now Be Seen on Zillow

Funny how things have changed in the decade I've been helping people in and out of homes. And, funny, how so many Realtors still try to hold information so tight to their chest. Don't want to give it out, we may lose value as a Realtor.

Anyone that works with me knows I've a giver of information. And, I once had one of the owners of my company tell me I give too much info. I ignored that tid-bit, I still give tons of info out.

Needless to say, I'm perfectly fine with Zillow providing buyers/sellers information about pre-foreclosure homes. Buyers and Sellers need to know what's out there. Need to be properly informed about the condition of the market when they are deciding to contact a Realtor to help them buy or sell.

But, keep in mind, only a working Realtor knows the true value of your home that you want to sell and the appropriate way to write an offer for the home you want to buy.

Good to be informed, learn as much as you can. It's one of the most important decisions in your life. But, make sure you have a Realtor that can guide you in that decision.





Tuesday, October 23, 2012

More Banks Fail & SS/Foreclosure Homeowners Coming Back To Buy

Three more banks have failed in 2012 bringing the total to 46. The FDIC has to dig into their insurance fund for that. Seems like a lot, but this time last year the number was at 80 failures with the total for 2011 being 92, twice where we are now.

So, while it stinks that banks have failed, one it was noted "had experienced substantial dissipation of assets and earnings due to unsafe and unsound practices". Go figure. Think they deserve to fail?
And, on another note,....homeowners that Short-Sold or were Foreclosed upon are coming back on the market as new buyers. So, the competition is getting even fiercer. My first Short-Sale was almost exactly four years ago. And, while many have been completed since then, I'm just now seeing ones trying to repurchase.

All I can say is, let's make sure we have a darn good reason for the Short-Sale/Foreclosure and that everything is scrutinized with a magnifying glass before another loan is issued.

Friday, October 19, 2012

Great Presidential Article


I read daily, and this one dropped in today  ~ it is pretty detailed if you are waffling with concerns about housing and the Presidential nominees. Copied and pasted for your pleasure.

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"Obama, Romney's Housing Plans Won't Make Huge Difference: Report

While Barack Obama and Mitt Romney may have been “frustratingly light on detail” so far with regards to housing, an analysis by Capital Economics reveals the two candidates’ policies may have more in common than they care to admit.

In a Housing Market Update released by the company, property economist Paul Diggle writes that, based on the information Capital Economics has pieced together, “it looks like anyone expecting either candidates’ housing plan to make a dramatic difference to the course of the housing recovery will be disappointed.”

When it comes to the continuation of current housing policies, both President Obama and Governor Romney largely agree. For one thing, both candidates support selling off government-owned REOs to investors, a process that has already been tested to some success. Both favor the greater use of foreclosure alternatives, promoting a shift toward short sales and deeds in lieu of foreclosure. And both share at least a small section of common ground with regards to principal reductions.

“Obama supports outright principal reductions on underwater mortgages owned or guaranteed by Fannie Mae and Freddie Mac in an attempt to reduce the delinquency rate. Romney, meanwhile, gave a brief supportive mentioned to shared appreciation-whereby lenders forgive borrowers some of their outstanding mortgage balance in exchange for a share of future house price gains-in his housing plan,” Diggle said.

As president, either man will likely face some measure of opposition from the FHFA, which has expressed its opposition to principal reductions and has so far “made for an effective roadblock” on those efforts. Diggle speculated that the forced removal of FHFA acting director Edward DeMarco may be necessary for progress on that front.

In addition, both Obama and Romney seem to agree on paring back the mortgage interest deduction, but neither wants to scrap the deduction entirely. While altering the deduction will probably change the renting/buying trade-off somewhat, Capital Economics’ calculations suggest even without a deduction, buying is still a better deal at the moment.

While there appear to be many similarities in the candidates’ housing plans, they don’t agree on every point. For one thing, “it’s likely that Obama would use a second term to renew efforts towards allowing more mortgage borrowers to refinance onto lower rates,” including an expansion of the HARP program outside of Fannie and Freddie-owned mortgages.

Romney, on the other hand, proposes to create looser mortgage credit conditions by repealing Dodd-Frank. His concern is that the current uncertainty about the definition of a “qualified mortgage” is hindering credit availability. Diggle cited a recent survey by the Federal Reserve that revealed legislative concerns are becoming an “important factor” in mortgage credit for about a third of respondents. However, that issue seemed to worry lenders less than put-back risk, the availability of mortgage insurance, and the house price outlook.

The bottom line, Diggle said, is that while both candidates’ policies would likely be helpful for the housing recovery, neither candidate is likely to improve the current course of housing greatly.

“The fundamental drivers of the housing recovery will continue to be the very favourable level of valuations and affordability, meaning that the housing market should continue recovering with or without further policy tinkering,” Diggle said."

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


Thoughts?

Tuesday, October 16, 2012

How Many Short-Sales Since 2009?

As I'm reading my daily news, Realtor stuff, Mortgage info...I came across one that sounded like every other one. "Lookie here how much we've done!" It's about the HOPE NOW information that has been collected regarding the number of homeowners that have been given permanent loan modifications, principal reductions, and completed Short-Sales.

All with the ultimate goal in mind...Avoid Foreclosure.

But, Really, Lookie Here:

Short-Sales completed since December 2009 ~ 1,013,565

HOPE NOW, the voluntary, private sector alliance of mortgage servicers, investors, mortgage insurers and non-profit counselors, also stated that the industry has seen 5.75 million loan mods.

Between the Short-Sales and Loan mods, 6.77 Million in avoiding foreclosure for American homeowners.

Amazing.....




Saturday, October 13, 2012

MLS Stats & Headlines Today

Up super early on a gorgeous Saturday morning prepping for my day with two new buyers and working out the details on two new listings.

Headlines, just in LA Times are all about the rebounding of the housing market ~

'Major dip in foreclosure sales drives Southland home price gains'
'Median home price in Southland climbs as supply is squeezed'
'Wells Fargo profit rises 22%'
'JP Morgan's profit surges 34% on mortgage growth'
'Foreclosure filings drop to five-year low in September'

Well, you can't help but get a little smiley about those headlines if you are in my business. But the other side of that is the inventory report for you today. Not so smiley in Santa Clarita Valley ~

ACTIVE Listings ~ 364 Total / REO's are 19 of that and Short-Sales number 92.

UNDER CONTRACT Listings ~ 1107 / REO's account for 74 and the big winner is SS to the tune of 789.

SOLD in the last 30 days ~ 377 total units / REO's were 46 and SS were 149.

And, that's my news for the day!



Wednesday, October 10, 2012

Distressed Homeowner Initiative Results

The Distressed Homeowner Initiative, first nationwide effort focused on fraud schemes targeting struggling homeowners, report their first year results and I'm happy to share them with you!

10/1/2011-9/30/12 Results ~

530 Criminal Defendants charged in 285 federal criminal indictments ~ YES!!

The cases involved more than 73k homeowner victims and estimated loss exceeding 1 Billion dollars ! Bastards! (Ooops, sorry...)

Other groups also filed 110 federal civil cases against 153 defendants identifying 15k victims and losses of more than 37 million. Can I say the 'B" word again?!?!?

The AG, FBI and FTC feel very strongly about making sure mortgage fraud is handled with more than just investigation and without hesitation. They want to "Ensure the integrity of the housing market, and to keep our communities safe."

Also they have forced into compliance almost 1000 websites and advertisers that were considered fraudulent or 'confusing'. Thank goodness!

 I've talked about this before, damn ambulance chasers ought to be driven over by one!

Friday, October 5, 2012

1/3 of Americans Think Strategic Default is OK

WHAAAATTTTT?!?!? Okay, now really, that's just terrible. The only Strategic Default that I would think is okay is if you just can't afford your home and you've exhausted every possibility to keep it. You've tried a Loan Mod, you've asked for a Principal Reduction, you've even attempted a Short-Sale. And, none of those programs worked for you. But, you still can't afford to keep your family home.

But, the article I read this morning states that 32% of Americans justify a Strategic Default. Oh, that just breaks my heart. Now, I'm not going to lie, as a Realtor I've talked to many a homeowner about defaulting on their home. The ramifications of doing so, the pros and the cons. Most have worked through a Short-Sale, Loan Mod, or Principal Reduction instead. Most.

A poll, called the Zogby Poll, found that so many feel it's acceptable to walk away. Some feel justified in their decision because they feel the mortgage market has been full of deceit for many years. Lending to people that didn't understand what they were borrowing. Many were less than concerned about the aftermath on their credit scores and felt it was A.O.K. to have a low FICO score.

But, gee, go figure on this final note in the article from the Poll : "In addition to those findings, 17 percent said they would exaggerate personal information to obtain credit"

It would be great if when filling out their next loan application,
 we could watch their nose to see if they were lying or not.

Tuesday, October 2, 2012

Another Round with Short Sales

As a working Realtor, and Certified Distressed Property Expert, in the Santa Clarita Valley, I've had my share of Short-Sales. The first was when Countrywide was still Countrywide...seems like eons ago. 

Most of this year has been working with buyers, but I'm initiating a new Short-Sale listing this morning, and another one in a week or two. 

Don't shoot the messenger the bank reps and myself say. I'm nice, polite, ask lots of questions....and they are nice and polite back. So far so good. Two loans, two banks.

My work is cut out for me. But, I'm a nagger, so it'll be best if they are ready for that up front.

When working a short-sale the hardest part is keeping the buyer interested. Shouldn't be too hard considering the lack of inventory.

Wells Fargo will work the Equator program. Love it, all uploaded and followed. E-Trade is the second, no history with them, but 'Bobby' over there was very efficient just answering the phone. We'll see if that follows through by sending me their short-sale packet.

Hard work is like food for me though, I thrive on it.


And a positive attitude ~ gotta have one!

Friday, September 28, 2012

SCV Realtor Thoughts

Reading all kinds of stuff this morning. A lot about the 'cooling' trend of housing. A ton about the 3.4% interest rates too.

Today, is all about opinion....mine. Experience....mine. Summary of thoughts....mine.

Housing has slowed. Okay, yes, we're getting close to holidays and loans are still (as they should be) a bit challenging for some to obtain. One point that makes sense. No, I don't think the slowing down has anything to do with a housing bubble.

Interest rates @ 3.4%. Well, HELLO, we knew they'd be held down. QE 3 and all....who knows what will really happen in 2013 though.

Buyers ~ The first 1/2 of 2012 seemed like all my clients were buyers. Oh, wait, not all, but 90%, yes. Now, just as the tables have turned on the MLS regarding Short-Sales vs Traditional sellers, so have my client needs. I am now working with 90% ~ Sellers. 1/2 Traditional, 1/2 SS.

But what does that mean? Is it just my 'dumb luck' that I'm working with mostly sellers now? Maybe, but I don't think so.

In my humble opinion, I believe the housing has hit its bottom and is on the way up. I know, for certain as I've done the math, it is also less expensive to buy now than it was a few years ago, even one year ago, regardless of an increase in prices.

Buyers, you need to buy now. Figure out a way to make it happen. I believe that some of the slowness is exasperation on the buyers side, frustration, tired of the battle to find a home. And, yes, some would be the challenge to get a loan. If you can't get a loan, do something to fix your problem and try to buy a home before they get out of your affordability range.

Sellers, sell if you need to, or want a move up property. Although we are seeing a moderate increase in home prices due to lack of inventory....don't expect to see 2006 prices anytime soon. And, I think a few of my sellers know that we may bet a few more listings in the beginning of 2013 so sell now when the competition is scant.

My thoughts, enjoy. Your thoughts?





Tuesday, September 25, 2012

Shadow Inventory Is Definitely Decreasing

If you don't read the news, you won't know this. But, here it is ~ THE SHADOW INVENTORY IS DEFINITELY DECREASING! And, that means housing recovery.

There, should I stop writing? Hah, nope...wanted to share JPMorgan Chase's research numbers with you.



1.2 million homes are no longer considered in the shadow, as of the first half of this year. If that progress continues, we could be down to only 4 million. But, that is great news, down from 6m in 2010! 335,000 in Short-Sales, 420,000 in loan mods, and about 470,000 REO's sold in those numbers.

Expected by the end of the year numbers:

Sell 950k REO's, 670k Short-Sales, and 800k total loan mods.

Right now we have almost 11 million people underwater in their home loans. Prices are certainly going up in Santa Clarita Valley and San Fernando Valley. If prices continue to improve, Chase's estimate of a 10% increase, then we'd only have about 9 million people paying on their homes that they owe more than it's currently worth.

What say you???

Friday, September 21, 2012

Bank Of America Cutting Jobs, Of Course

Bank Of America is cutting back...news in LA Times today. Of course they are....I'm pretty sure the other from the Big 5 will cut back as well. And, the medium 4....and many other banks too.



16k jobs, 200 branches and shrinking of the mortgage operation. Ultimately cutting back 30k jobs to save some 5 billion.

I get that, downgrading of junior investment bankers, consumer banking employees, and the ones overseeing new mortgages. The peeps in the Global Wealth and Investment Management sector will remain untouched.

But, let's face it, a lot of jobs were added due to the housing crisis....and a lot of jobs will get cut as the number of employees needed reduces.

Interesting that Bank of America left the wholesale lending business a while ago and kept their loans in B of A. With their cutting back of new mortgage employees, I wonder if they will get back into the wholesale market again. I hope so because I wasn't too happy with the last B of A mortgage rep one of my clients tried to work with!

Tuesday, September 18, 2012

Wall of Shame? Funny, Interesting Read!

I honestly don't know where I read the article, but one this morning I'm sharing. "The Wall of Shame". I believe it was happening in Seattle?

At any rate, many of the homes that have been foreclosed upon, and remain vacant, are being posted on a website with bank information, etc. The city feels that these banks are not doing their due diligence in keeping the properties maintained as they are to by law.

I know a Canyon Country family that has one of these homes on their street and the bank has been less than responsive to their concerns, health being a huge red flag. The family has sent numerous letters to the bank to no avail.

So, this little city mayor has set up the Wall of Shame and is posting pictures of the homes. Citing the banks, placing liens against them if the fees are not being paid. Anything they think might make the bank stand up and take notice, they are attempting.

With all the Social Media Networking that Santa Clarita Valley residents do, we'd have a great tool for publicizing any banks lack of responsibility.

However, I'm not seeing the dilapidated homes now as much as we were a few years ago spread around our beautiful, albeit scorching hot, little valley. I used to be able to drive around and point out foreclosures around SCV, today not so much.

Fees were put into effect, $1000.00/day, as I recall, if the banks were not keeping the lawns, pools, etc. maintained.

At any rate, I think a Wall of Shame could be another way to help keep the banks in line. You?

Friday, September 14, 2012

What Will QE3 Do For Real Estate?

It's the talk of the news today. Federal Reserve to buy Mortgage Backed Securities at the rate of 40 BILLION per month. Starting at 85 Billion per month thru the end of the year, then going to the 40 Billion per month amount.


What does this mean for Real Estate? The interest rates are now supposed to be kept in this 3% bracket through 2015. QE3 hopes to help the jobless rate, the housing crisis, the economy in general is to be improved.

I watched a great video and read a couple of terrific articles. Google QE3 and you'll find out a ton of information.

To me, my friends, associates, clients......it means that rates will continue to be low and that will help people afford homes. 

Certainly not a miracle cure, none of the programs have been. Just another pill for the cure of the housing crisis.

Tuesday, September 11, 2012

First FHFA REO Bulk Sale Awarded

A while ago we heard that REO's were going to be sold in bulk to investors. I have read that the California Association of Realtors (C.A.R.) is against this. The C.A.R. feels, rightfully so, that we need the listings on the market for traditional home buyers.

The bulk sales are going to be sold to investors, after they have determined they are worthy of the properties and will do with them what the FHFA had intended.

Many are occupied, so the investors will become landlords. The first bulk sale was in Florida, one of the hardest hit states of the housing bust. 699 units were in this transaction, just over 500 had people living in them. The estimated value to Fannie Mae is 78.1 million. These properties were apparently sold at near, or even above, market value.

Through this pilot program, almost 2500 Fannie Mae foreclosed homes are scheduled for bulk sale in neighborhoods of Las Vegas, Phoenix, Chicago, Nevada, Arizona, and the Riverside and Los Angeles areas of California.

Bulk sales in housing...not sure if this is a good idea or not. While we want to clear out as many REO's as fast as possible with the least amount of burden to the taxpayers....we really need more homes for our buyers.....What say you?




Saturday, September 8, 2012

Santa Clarita MLS Stats

Wow, how the tables have turned!

I make no guarantee on the accuracy of what type of listing is marked in our MLS...there are errors, trust me....but, you'll get the picture! That would be why the numbers don't add up to the totals....all the time...

Total number of ACTIVE listings in our Santa Clarita Valley communities: 391 ~ Obscenely low inventory!
Of that obscene inventory:
Standard Sales ~ 253
Short-Sales ~ 99
REO's ~ 35

Total that are either in PENDING or Supposedly taking BACK-UP offers: 1132, Crazy, isn't it?
Of that crazy number:
Standard Sales ~ 237
Short-Sales ~ 807
REO's ~ 80

And, the number of SOLD, or closed escrow in the last 30 days: 325 ~ Pretty typical.
Of that typical amount:
Standard Sales ~ 132
Short-Sales ~ 144
REO's ~ 50

While, again, I am happy that more Standard Sellers are able to come on the market, we still have a ways to go.

 More REO's would be nice to have to sell, wouldn't they?

Saturday, September 1, 2012

About 1/2 Paid Out for ROBO Settlement Already

Seems like we are all hearing more and more success stories about Short-Sales completing, Loan Modifications working, and Principal Reductions being authorized. Don't yell at me! I know it's not happening for everyone, but it is happening, and for the ones that are eligible, it's happening a tad quicker.

Apparently to the tune of about 140,000 homeowners and 10.6 Billion dollars in the second quarter of this year. The 5 big banks that were part of the Robo-Signing Settlement ~ Bank of America, Chase, Ally, Wells Fargo, and Citi ~ have all been working hard to follow through on the terms of the settlement.

The largest category of relief so far, no surprise, is in Short-Sales. Tons of them happening, lots of short pay-offs. And, Bank of America is the one that has provided the most relief to the struggling homeowners.

California, my beautiful state, received the most money of any state, with about 4.6 billion in assistance.

I wonder though, what do you think will happen when the 25 billion settlement is fulfilled?


Wednesday, August 29, 2012

First Time Investors Beware

Prices are going up, that's it. I could just stop this post with that one line.

But, I won't....Reading an article today confirms what I already know. Investors are backing off in the purchase of properties. They have seen, as I have (and every other Realtor that is working) seen in the last few months, that prices are on the rise.

As always, when making the decision to invest in a property, other than the one you will live in, you absolutely must do the math. Make sure that you work the numbers to see if there is enough profit and/or ROI in the deal to make it worthwhile. With prices inching up, it has become less desirable for investors. 

Now, I'm not saying there aren't still deals to be had, there are, but they are harder to come by. Anyone that is regularly reading my blog knows this. To re-cap, inventory is at ridiculously low levels, as are interest rates. And, interest rates this low are one of the main drivers in this purchase market.

We are also seeing more Traditional sellers come on the market. Due to the desirability of an 'easy' sale, they are generally getting more than the Short-Sales and REO's. 

With the market flipping from where it was just a few months ago, it's going to be even more important not to leap without doing your arithmetic. We have less distressed properties on the market, and less coming down the pipe-line. And, with a couple of the groups I network with I am seeing more 'Hey, I've got a rental available' than I did a few months ago. But, I hope you who have already made the leap of Real Estate faith, used a vacancy factor and a reduced rent factor in your original calculations.



Be careful out there. Look before you leap.

For any questions about Real Estate in the Santa Clarita Valley and it's surrounding communities:
Lauren@KeepYourWitz.com


Sunday, August 26, 2012

Average Days On Market

From start to finish sellers want to know how long it's going to take to sell their home. Any good Realtor knows that there are many factors in determining the likely answer to that question.

What type of market are we in ~ buyers market or sellers market?
Is the seller going to prep the house for sale?
Will the seller price it appropriately?
What price range is the property in?
How many buyers are buying in that range every month?
How many listings are on the market, now and 3 months ago?
What selling season are we in?
What's your competition?
I could keep going, but you get the picture.

With that in mind I thought I'd share with you a different type of stat than I've shared before. Let me know if you find it interesting, let alone worth reading.

In the last 90 days of home that have closed escrow according to our local MLS; below is information about the Average Days On Market ~ i.e. how long did it take to sell a home.

Under 250k ~ 324 homes sold ~ ADM = 102
250-500k ~ 568 homes sold ~ ADM = 87
500-750k ~ 98 homes sold ~ ADM = 95
750k-1M ~ 25 homes sold ~ ADM = 130
And, 1M + ~ 14 homes sold ~ ADM = 86

Looking at those same categories, but just Traditional (Standard) Sellers:

80/65
247/57
65/80
21/142
11/100

Any way you look at it, the average time to sell a home, anticipating a 35 day escrow period, is between a month or two. I can pick them apart further for you, but I could bet you that the ones that moved quicker were the ones that were priced right. And, the ones that took longer experienced a price reduction or two.

Now, you're thinking, "but dang, I've seen properties going out with multiple offers in just a couple of days". And, you would be right. But, you would be wrong if you thought the ones priced well over current market value were part of that 'but, dang'.

I can sell a gorgeous home, a mansion, a sweet little pink house, a condo, a swamp....to anybody. There is a buyer for every type of property, everywhere. Price is what makes the ultimate reason for a home selling. And, price is what makes the average days on market be long or be short.


How long do you want to be on the market?


Wednesday, August 22, 2012

FICO or Veritas?

So, we've heard some buzz about FICO re-working their scoring to help accommodate the Short-Sale and Foreclosure dings, if those are the only dings.

A newer evaluation system called Veritas (Latin for Truth) developed by a company called Digital Risk is suggesting their way of determining a borrowers credit-worthiness is much better than the old faithful FICO.

They've been doing a lot of studying due to the housing bust, focusing on strategic defaults it would appear. Why someone would be a risk of strategic default and another not, with the exact same FICO scoring.

From my article reading activity this morning, LA Times writes: In early August it introduced a multidimensional risk evaluation system it calls "Veritas," which it says integrates borrower credit characteristics with property and local real estate market data along with proprietary behavioral prediction models. The behavioral component includes what the firm calls statistical "clusters" of borrower, property and market situations — 123 in all — that give lenders a better idea of how an applicant will react to financial problems, such as the next recession or housing downturn. 

You can read the entire article here: Reading Article of The Day

I think an updated version of FICO scoring is great, I am concerned that lenders may have to rely on psychoanalysis of their clients now. That's a pretty subjective arena. What do you think?




Sunday, August 19, 2012

Construction Slowed, But Building Permits Rose

One of the indicators of a turning market is the amount of new construction. It fuels movement in the Real Estate arena. And, if there isn't anything to feed the fire, it just shoots up puffs of smoke. Of course.

So, while the actual construction dropped a tad this past month, the increase in PERMITS is the highest it's been in 4 years. Compared with July 2011, overall permits saw a 29.5% rise. What's that say to you?

If the big dogs, the builders, the contractors, the people with a boat-load of money to invest in housing, feel that it's time to push for more permits, to prep for more home building, then it's just another indicator that we are moving out of the slump.



Interest rates have been creeping up the last few weeks, inventory took a teeny spike (one day this week we actually had 30 more units on our MLS than less), builders are calling out for more permits, and many housing reports are showing optimism.

Although I still believe we have a long way to go before we hit a 'normal' market, there have been several good indicators. I'm going with those. But, really, I don't know if I remember a 'normal' market, do you?


Wednesday, August 15, 2012

The Debt Relief Act ~ Latest News

I had read a while ago that Obama put an extension in the budget for 2013, but that was anyone's guess if it was really going to make it.

Right now, the Mortgage Forgiveness Debt Relief Act is still set to expire at the end of this year, 2012. That's the bill that allows people who have had housing debt forgiven via Short-Sales, Foreclosure, and Loan Modifications not have to pay taxes on the amount forgiven.

L. A. Times, one of my daily Real Estate reads, notes:

The Senate Finance Committee has approved a bipartisan bill that would extend the Mortgage Forgiveness Debt Relief Act through 2013.

and points out:

It was after heavy lobbying by the National Assn. of Realtors and the National Assn. of Home Builders. The bill, which now moves to the full Senate for possible action next month, also would extend tax write-offs for mortgage insurance premiums for 2012 and through 2013 and continue some energy-efficiency tax credits for remodelings and home construction.

Read the Full Article Here:  Senate Panel Wants To Extend DRA


Now, we can only hope that this settled BEFORE the election. If not, then we are struggling to see who is in and what their decision is. To continue the help, or cut it off?




Saturday, August 11, 2012

Is This A Temporary Bubble?

I asked my fish-guy husband today for a blog post topic. I read the news, everyone knows the market is going up. So, I thought, "I'll ask a normal person what they want to read about" And, my normal person said, 'How's the market, is this a smart time to buy?" I almost peed myself laughing out loud. Don't all people ask Realtors that?

He did probe a bit more with..."Is this appreciation we are seeing going to last?"

So, again without my crystal ball, what do I think about this little bubble we are seeing? Hmmm.....

Well, if the inventory stays low, the appreciation is definitely going to last. Most definitely, the infamous supply and demand theory, we all know that. If interest rates stay low, yes, people can still buy. Tough for some to qualify, but enough can still buy to eat up the inventory.

Once we start getting more homes on the market, the demand will ease up. Right now we are seeing multiple offers on most median priced homes. More standard sellers coming on the market too and some are getting premium prices.

Right now, we are about 1/3 of our Santa Clarita Valley healthy market number of active homes in the MLS. I think we can handle twice what we have and still see significant appreciation, most definitely. I believe once we get to the 1200-1400 range, we will be setting down and go back to the 2-3% appreciation that is more of what we consider normal.

Do I think we may see a bubble burst again? Me? No, not really. I think we may see a staleness, a flat line, but not a near death again. I think we will be floating along nice and easy. Maybe not perfect, but a little less of the near death experience for certain.


Wednesday, August 8, 2012

It's Been FOUR Years...

I'm reading all the Real Estate news this morning. Most important that keeps coming on my computer screen ~ in every different format ~ is that Fannie Mae earned enough of a profit that they could pay the Treasury back 2.9 million which leaves them just about 96 million more to cough up ~ Truth!

But, this week marked the first time in FOUR years that I've had an appraisal problem. This one is an escrow for a buyer. Appraisal came in below purchase price 5%. It's a small purchase to some, but it's a good chunk of change to the buyer.



Short-Sale that took over 3 months to get approved. And, now we have to ask them to reduce the purchase price.

I spoke with the appraiser....there really aren't strong enough comps to support the purchase price. Keep reading.....

Backwards now.....multiple offers on the property when we wrote. Buyer is doing 95% financing and we were competing against an all cash offer....from within the listing agents company! But, she stood true to her word and because ours came in first, the seller took my clients offer.

3 months ago we were still in a bit of a declining market, wouldn't you say? Fast forward to now and we are in a market that is appreciating. The inventory has reduced to horribly low levels, every property (short-sale or not) seems to have multiple offers on them. A buyer doing 95% financing has an uphill battle on acceptance with these conditions.

But, I don't just bend over. Nope. We have one comp for a lesser unit that closed closer to our purchase price....but that's not enough. So I contact escrow and ask is there any extra money floating around ~ they are checking. And, the listing agent is submitting the appraisal to the SS lender and asking for a reduction in purchase price.

Back on the sidelines is that all cash buyer just waiting to pounce!

So, 4 years later I'm working on it for my client. Last time it worked out AOK....we shall see how this works out.