4 Big Short Sales Hang-ups

Daily Real Estate News | Thursday, February 21, 2013

Short sales in Redding CA are increasing this year, and these transactions can take up to three times longer than a traditional transaction. A lot can go wrong in that timeframe. The most common delays, according to a recent article by George “Gee” Dunsten, a real estate broker and president of Gee Dunsten Seminars, at RISMedia are below.

Title issues: Be sure to do a title exam at the beginning in order to identify all individuals on the deed and mortgages, and determine all lien holders.
Lack of communication with the lender: Lost documents and misunderstandings commonly cause delays. Make it a habit to follow up with the mortgage servicer twice a week to avoid unnecessary delays.
Delaying the start: Some short sales have not even begun until a contract to purchase has been initiated. But this could add up to two extra months to the process. The lender won’t even look at a buyer contract until a seller candidate for a short sale is approved and the market value has been determined, Dunsten writes.
Incomplete packages: Make sure you carefully submit all the documents completely and accurately. Submitting incomplete packages is another common culprit of delays. All home owner financial information will need to be kept current and forwarded to the servicer every 30 days, Dunsten writes.

Kasey Stewart
Stewart Real Estate Company
#01914571
www.stewartrealestate.com
1700 Market St #102
Redding CA 96001
530-255-4133

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What’s Behind Falling Housing Inventories?

Daily Real Estate News | Thursday, January 24, 2013

Home prices are increasing across the country as the number of homes for-sale continues to fall. But at a time when buyer demand is picking up, why is inventory still so low?

Inventories fell to 1.82 million at the end of last year, a 21.6 percent drop from one year earlier, the National Association of REALTORS® reports.

The Wall Street Journal recently highlighted several reasons behind the dropping inventories, including:

Sellers hesitant to sell: About 22 percent of home owners with a mortgage are still underwater, owing more than their home is currently worth. Home owners don’t tend to sell unless a life-changing event occurs when they’re underwater because they don’t want to take a loss on the sale of their house. CoreLogic data shows that inventories are the most constrained in areas with the highest number of underwater borrowers.
Not enough equity to trade up: Often times, home owners rely on the equity from their home to make a down payment on their next home. With fewer home owners seeing equity in their houses, they may not have enough money to move into a pricier home, which is constraining the would-be “trade up” buyer from moving.
Investors continue to snatch up properties: Investors are snapping up properties, but they’ve changed their strategy from past years, which is also constraining inventories. Now they’re holding onto properties and turning them into rentals instead of rehabbing properties and flipping them for profit. This is keeping fewer homes on the market.
Banks are slowing down foreclosures: Banks have new rules to meet with the foreclosure process, and it’s causing them to move at a slower pace in foreclosing on homes. Banks also are showing a preference for short sales and loan modifications, which are curbing the number of foreclosed homes on the market.
Builders are doing less building: Housing starts were at record lows from 2009 through 2011 so there’s less inventory being added to the market. A rebound in the new-home market has only recently started to occur.

Source: “Six Reasons Housing Inventory Keeps Declining,” The Wall Street Journal (Jan. 22, 2013)

Stewart Real Estate Company
www.stewartrealestate.com
01914571
530-255-4133
1700 Market St. #102
Redding CA 96001

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Home Owners Reluctant to Sell; Inventories Fall

Daily Real Estate News | Wednesday, January 16, 2013

Inventory levels of for-sale homes at the end of 2012 were down 17.3 percent from year-ago levels, reaching the lowest level in more than five years, Realtor.com reports. In some areas, inventories have dropped 68 percent over the year.

“It’s been a buyers’ market for a while. Sellers have been reluctant to put their homes on the market,” says Steve Berkowitz, chief executive of Move Inc., which operates Realtor.com. As housing numbers roll out for January and February in the coming weeks, these will be notable to watch because they’ll provide early clues about buyer traffic and sellers’ expectations, Berkowitz says.

For-sale inventories dropped the most year-over-year in December 2012 in the following metros:

Sacramento, Calif.: -68%
Stockton-Lodi, Calif.: -65%
Oakland, Calif.: -64%
San Jose, Calif.: -52%
Seattle-Bellevue-Everett, Wash.: -45%
San Francisco: -43%
Ventura, Calif.: -43%
Riverside-San Bernardino, Calif.: -41%
Los Angeles-Long Beach, Calif.: -40%
Orange County, Calif.: -39%

Source: Realtor.com and “Housing Inventory Ends Year Down 17%,” The Wall Street Journal (Jan. 16, 2013)

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Stewart Real Estate Company
#01914571
www.stewartrealestate.com
1700 Market St #102
Redding CA 96001
530-255-4133

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New Calif. Law Requires Disclosure of Foreclosure to Tenants

New Calif. Law Requires Disclosure of Foreclosure to Tenants
Daily Real Estate News | Thursday, January 03, 2013

As of Jan. 1, property managers and landlords in California are required to disclose in writing to any prospective tenants if a notice of default has been recorded against the property. The law applies to rentals of single-family homes and apartment buildings of no more than four units.

The disclosure also includes a notice that if a new owner takes ownership of a property following foreclosure, the owner will not be able to evict the tenants for at least 90 days written eviction notices in many cases.

Supporters of the new bill say that that such a disclosure is critical for tenants in making an informed decision about where to live. Opponents, however, argued that such disclosures could worsen the financial conditions of the landlord and even hasten foreclosure.

For landlords who violate the disclosure requirement, tenants may be able to void any lease and recover one month’s rent or twice the actual damages — whichever is greater. Tenants may also be able to recover all prepaid rent from the landlord if the landlord violates the disclosure requirement, according to the new law.

The California Association of REALTORS® is offering a new form (LID) for the new disclosure to its members.

Source: “In California Prospective Tenants Will Have To Be Told If The Property Is In Foreclosure,” Realty Times (Jan. 1, 2012)

Stewart Real Estate Company
#01914571
1700 Market St #102
Redding CA 96001
www.stewartrealestate.com
530-255-4133

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Are Young Adults Missing Out on Big Housing Opportunities?

Daily Real Estate News | Friday, December 21, 2012

With low mortgage rates and fallen home values, some housing analysts are questioning why more first-time buyers—particularly the younger generation—aren’t flooding to the market. As a recent Reuters article questions: Could they be missing out on the “sweet spot” of the housing market by delaying their home purchases?

The desire to buy is certainly there. Ninety-three percent of renters in the millennial generation say they plan to buy a home in the future, according to a poll by Trulia. But the number of first-time home buyers remains constrained: One in three home buyers are first-timers, the article notes.

“Maybe that’s because some millennials—generally those now in their 20s to early 30s—don’t have the jobs that qualify them for mortgages, or because they are taking time to accumulate down payments, or because the ongoing wave of foreclosures has frightened them,” writes Linda Stern, a Reuters columnist.

Whatever the case, they may still have some time to cash in, particularly as long as financing a home purchase remains so low. The Fed announced it is keeping interest rates low until the unemployment rate drops below 6.5 percent, which the Fed doesn’t expect to happen until 2015.

Real estate professionals may be able to help the younger generation work toward their goal of home ownership in the meantime too.

For example, as the Reuters article points out, those looking to buy soon should take several steps to home ownership, such as working to improve and protect their credit score. “If your score is anything less than 740, find out how you can raise it — paying down a credit card balance, putting more time between you and your last late fee,” Stern writes. The article also notes CreditKarma.com, a free site that allows you to monitor your credit score until it’s more attractive to a lender.

Young adults who are aspiring for home ownership also should start tightening up their wallets and saving for a down payment and closing costs. Also, they should learn about mortgages available from the Federal Housing Administration, which offers loan products with low down payments that are popular among first-time home buyers.

Source: “Are First-time Homebuyers Missing the Sweet Spot?” Reuters (Dec. 19, 2012)

Stewart Real Estate Company
01914571
www.stewartrealestate.com
530-255-4133

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No Foreclosures for the Holidays From Fannie, Freddie

Daily Real Estate News | Tuesday, December 04, 2012

Mortgage giants Fannie Mae and Freddie Mac announced Monday that they will temporarily halt all bank repossessions and evictions beginning in mid-December until Jan. 2, 2013.

The temporary foreclosure suspension goes into effect beginning Dec. 17 and Dec. 19, respectively. The moratorium will not affect the filing notices of default or the scheduling of auction sales.

“The holidays are a chance to be with loved ones and we want to relieve some stress at this time of year,” says Terry Edwards, Executive Vice President of Credit Portfolio Management, Fannie Mae.

Bank of America also recently announced that it is halting foreclosure evictions for the holidays for loans it owns and for those it services for investors. JPMorgan Chase, Wells Fargo, and Citibank have yet to release a statement on whether they’ll follow suit, although they have done so in the past for the holidays.

Source: “Fannie and Freddie Halt Foreclosures for the Holiday,” CNNMoney (Dec. 3, 2012)

Stewart Real Estate Company
01914571
www.stewartrealestate.com
530-255-4133

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Foreclosure Discounts Vanishing

Daily Real Estate News | Tuesday, November 20, 2012

Foreclosure discounts have nearly dried up due to low inventory levels, according to the latest housing reports.

The average discount nationwide for foreclosure properties has fallen to 7.7 percent, according to Zillow research. In some parts of the country, there is no foreclosure discount when compared to other sales.

“The smallest foreclosure discount is found in places where competition for homes is so high, people there are willing to pay the same amount for a foreclosure re-sale that they would for a non-distressed home simply to take advantage of historic affordability,” says Stan Humphries, Zillow’s chief economist.

The smallest foreclosure discounts can be found in:

Las Vegas (0%)
Phoenix (0%)
Sacramento, Calif. (0.7%)
Riverside, Calif. (1.8%)
San Diego (2.4%)
Miami-Ft. Lauderdale (2.9%)
Los Angeles (4.2%)
San Francisco (4.7%)

Meanwhile, the places with the largest foreclosure discounts are:

Pittsburgh, Pa. (27.8%)
Cleveland (25.8%)
Cincinnati (20.2%)
Baltimore (20%)
New York City (15.5%)

Source: “Low Inventory Wipes Out Foreclosure Discount,” Examiner.com (Nov. 18, 2012)

Stewart Real Estate Company
01914571
www.stewartrealestate.com
530-255-4133
1700 Market St #102
Redding CA 96001

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