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Category Archives: business of real estate

WooHoo… New Property Search!

I was just able to get it integrated into my site. I have a new property search (IDX).

softRealty rolled out their new IDX solution just this month, and I was one of the first in line to get it. I have long wanted a better search for my clients and visitors. Not only did I want something that integrated into the site better, but I wanted something that would that would provide a better interface for anyone looking at properties. So, here are a few highlights:

  • integrated map
  • mousing over a listing brings it up on the map
  • make changes to criteria on the fly, without having to leave the results area
  • mouse over the icon on the map to skip to the listing info
  • picture and basic info always visible

As soon as I get time, I will set up a search page which will have preset searches for specific areas and price ranges, allowing a one-click search for site visitors.

Jump on over to GarageHomesUSA and click on the “Property Search” item on the tool bar.

This might actually help…

Walk-away borrowers have been a problem in a few markets (luckily, not so much in Atlanta).  The government and lending industry are both looking at ways to keep borrowers from just walking away.

So, here is the situation…

Someone buys a home with a 0% down loan.  The market turns a bit south, and now the property is worth less than the mortgage balance.  The ARM is getting ready to reset, or does reset to a higher rate.  The payment is no longer comfortable. 

At this point, the borrower is faced with a tough decision.  They can stop paying… it will take a few months for the bank to foreclose.  They can try to sell the home in a short sale.  Or, they can try to find a way to refi or keep on making the higher payments. 

The problem is that a lot of borrowers are choosing to ride it out as long as possible, and then walk away.  There are even websites and groups promoting this.  They tell people facing these choices that they can “save” thousands of dollars and not face any negative consequences.  They are right that one could bank up a goodly amount of cash (house payments for 3-12 months)… but there are going to be negative consequences.

The government and the lending industry are taking aim at “walk-away” home owners who stop making payments and months later send the house keys back to their lender.

Such borrowers will not be able to get another mortgage through Fannie Mae for five years, unless there are “documented extenuating circumstances.” In that case, the prohibition is three years. Even after the prescribed time has elapsed, a borrower with a foreclosure in his file will have to make at least a 10 percent down payment and have a FICO credit score of at least 680 to qualify for a Fannie Mae loan.

Freddie Mac, which counts foreclosures as major credit black mark for seven years, is now aggressively pursuing walk-away borrowers where permitted under state law, a senior official said.

Federal legislation enacted last year allows home owners who negotiate loan modifications with lenders and have portions of their principal debt eliminated to escape income tax liability for the amount forgiven.

Walk-away borrowers, by contrast, have nothing forgiven, and the Internal Revenue Service may demand taxes on the balance they never paid, the IRS says.

Source: Washington Post Writers Group, Kenneth R. Harney (04/12/2008)

There are some very good short sale agents (I’ll tell you flat out that I am not one of them… it is a specialty that requires more than a 4 hour class to do well… and a complete focus on just short sales) and a good short sale agent can negotiate a loan modification to sell the home.

Do yourself a favor.  If you are in trouble, get help.  I’ll be happy to help find a good short sale specialist wherever you are.   If you want to stay in your home, contact your bank.  Talk to them.  It won’t be fun, but it will be way better than having the Sheriff do an eviction.

Here’s a deal…

This story was my “Good Morning” today.  The AP and AOL conducted a poll, and while the story is probably accurate (technically), I am seeing a serious bias here.  And I really don’t like to play the media bias card…  Let me toss out a couple of quotes from the article:

The growing reluctance to dip into the housing market seems to stem partly from worry that housing prices will continue falling — good if you’re buying a house but bad if you have to sell one.

The public anxiety is in reaction to an economy that is veering toward recession and losing jobs even as the housing market sputters badly. Foreclosures have soared to record highs, mortgage rates have increased, sales of existing and new homes have fallen and home values have dropped.

Of course, with a title like AP poll: More avoid buying homes, one shouldn’t expect it to be rosy…

Same story… different quotes:

Some pockets buck regional trends. Laurie Jensen, a single mother of three, struggles to make payments on her home in Whitehall, Mont., by working as a seasonal road construction flagger and at times collecting unemployment. She said she’d like to move outside of town, but the area is popular and prices have surged.

“Things are pretty crazy,” she said. “Places I don’t consider that great are really expensive.”

Even so, he said, many people bought their homes before the run-up in values that started around 2001 and remain in good shape.

“So the value of your house goes down temporarily,” he said. Unless the homeowner must sell now or can’t afford the payments, “that doesn’t have that much of an impact.”

There are a lot of stats in the article… but, as you read it, try to stay open to both sides of the picture…

“This is a great time to buy, but not necessarily to sell,” said Robert Jackson, who lives in a two-bedroom house in Ferguson, Mo., with his wife and four young children. He said he would love to purchase a larger home, but can’t because even if he found a buyer, he would probably lose thousands on his house, which he bought less than two years ago.

“We’re just going to have to slap a Band-Aid on it and stay here until the market gets a little bit better,” Jackson, 30, said in a follow-up interview.

Let’s look at this a bit more objectively.  If Mr. Jackson can afford a bigger house, he should do it.  The same “discount” that drops the price of the home he would be selling would be dropping the price of the home he would be buying.  If he loses $5,000 to gain a $10,000 discount on the $200,000 house he wants for his family, that seems like a good net to me.  I just don’t think that the best plan is to wait until the prices go up on both homes…

Now, if he were retiring and wanted to sell his big house and down-size… I’m right there.  It wouldn’t be the best time.  Taking the $10,000 hit to get a $5,000 discount isn’t good business.

Here is a another…

One in 10 have adjustable rate mortgages, half of the number who said so two years ago. These mortgages generally start at a low interest rate and are later adjusted to market conditions — which has often meant steep, unaffordable boosts that have forced many to refinance or even lose their homes.

Daniel Gallego, a warehouse worker in Stockton, Calif., said he may have to sell his home at a big loss. He said rising gasoline and other costs have made his adjustable rate mortgage unaffordable. Because he doesn’t expect his home’s value to recover soon, he said he may be better off moving now, before his rates rise.

So, nothing positive to say about fewer people having adjustable rate mortgages?   Nor a mention that the resets have been less than expected because of the slowing economy…  I’m not even going to hit on the idea that many of the adjustable rate borrowers weren’t real responsible taking out loans that they really didn’t have a plan to be able to pay back…

There is no doubt that the real estate market is not groovy for a lot of people… especially those that need to sell.  However, the fact remains that it isn’t as bad for most as it is for a few.  There are some pockets that are incredibly bad… and many in the media are portraying those as representative.  There are also a lot of places that are just chugging along.

I also don’t want to chime in with the NAR’s “All Real Estate is Local” mantra, but you really should look into the area that you are in and/or considering.  Heck, I’m starting to see builders jumping back in again.

Style points count

A few days ago, IGarrett on Ice posted a video about my son getting new hockey skates.  He was a proud little boy with those new skates.  At “not quite 4” he has decided that he wants to play hockey, and he has enthusiastically gone to skating lessons for the last 14 weeks.  We have also gone skating at least half a dozen times on Friday mornings at the Duluth Ice Forum (we skate at the Friday morning public skating session, feel free to join us).

This morning was the first opportunity for Garrett to skate on his new hockey skates.

You might have seen in the video that Garrett was wearing yellow rental skates.  Not only are they a bit ugly and dull, but they are figure skates.  Because of a design difference in the blades, figure skates and hockey skates are very different to skate on.  The result is that Garrett spent a lot of time on his butt…

On the figure skates, there is a straight tail off the back of the skate.  This allowed him to lean back and support himself without bending his knees.  Now, we all know that figure skaters don’t skate like that, and neither do hockey skaters.

But Garrett had found something that was working for him.  He was the fastest kid in his class… and not skating correctly at all.  He was getting a good result, but the result was temporary because his “work-around” wasn’t going to allow more performance.  He already had issues with skating backwards and a few other things he needed to do to pass the class. Garrett with the hockey skates

So, real estate, Lane… Real Estate…

There are a lot of agents that dived in and started with faulty methods.  They have achieved performance, but that doesn’t mean they are doing it right.  In fact, it isn’t limited to agents.

So, now Garrett is having to re-learn how to skate.  Not just that, he is having to un-learn how to skate the wrong way and then learn how to skate the right way.

Luckily, we have a little time, and there are not only good teachers, but we have a secret weapon.  He wants to play hockey, and one of the Thrashers is giving him some tips…

New Gwinnett County Market Report is out

I have loaded the new Gwinnett County Market Report onto GarageHomesUSA.

The news is mixed… and that is better than all bad.

Good.

  • Days on Market went down.
  • Listed/Sold % went up.
  • New Listings down from last year.

Bad.

  • Absorption Rates not good yet.
  • Sales still down from last year.
  • Listed/Sold % still weak.
  • Days on Market needs to drop more.

For the real story, follow the link and read up.

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