Guiding you every step of the way home!
May 7, 2012 Leave a comment
Pending-home sales in March hit their highest level since April 2010, spurring the return of real-estate bidding wars.
Nick Timiraos reports on The News Hub. Photo: Peter Earl McCollough for The Wall Street Journal.
March 8, 2012 Leave a comment
To avoid losing homes to foreclosure due to long response times for short sale transactions, three senators introduced legislation to speed up the short sale process.
Senators Lisa Murkowski (R-Alaska), Scott Brown (R-Massachusetts), and Sherrod Brown (D-Ohio) proposed the bill addressing the issue of short sales timelines on February 17. A short sale is a real estate transaction where the homeowner sells the property for less than the unpaid balance with the lender’s approval.
“There are neighborhoods across the country full of empty homes and underwater owners that have legitimate offers, but unresponsive banks,” said Murkowski. “What we have here is a failure to communicate. Why don’t we make it easier for Americans trying to participate in the housing market, regardless of whether the answer is ‘yes,’ ‘no’ or ‘maybe?’”
The legislation, also known as the Prompt Notification of Short Sale Act, will require a written response from a lender no later than 75 days after receipt of the written request from the buyer.
The lender’s response to the buyer must specify acceptance, rejection, a counter offer, need for extension, and an estimation for when a decision will be reached. The servicer will be limited to one extension of no more than 21 days. The bill will also allow the buyer to be awarded $1000, plus “reasonable” attorney fees if the Act is violated.
According to a release from Short Sale New England, short sale homes do not bring down neighboring home values like foreclosed homes do, and 83 percent of short sale buyers are satisfied with their purchase, according to a 2012 Home Ownership Satisfaction Survey conducted by HomeGain.
“The current short sale process can be time consuming and inefficient, and many would-be buyers end up walking away from a sale that could have saved a homeowner from foreclosure,” said Moe Veissi, president of the National Association of Realtors. “As the leading advocate for homeownership, realtors are supportive of any effort to improve the process for approving short sales.”
Equi-Trax released a survey last year on the issues real estate agents face when completing short sales. Guy Taylor, CEO at Equi-Trax, said 71.9 percent of respondents reported that a short sale can take four to nine months to complete, and they think that is simply too long.” The survey also found that 18.2 percent of deals require less than three months to complete, with 10 percent requiring more than 10 months.
When agents in the survey were asked to how the short sale process can be improved, 57.6 percent said lenders should take less time to close transactions, 14 percent said borrowers should be better educated about short sales, and 40.4 percent said both of these changes are necessary to improve the process.
In April 2011, a similar bill was introduced by Reps. Tom Rooney (R-Florida) and Robert Andrews (D-New Jersey), but this version requested a response deadline of 45 days instead of 75 from lenders. The legislation never came up for debate before a House committee.
Author: Esther Cho • Date: 02/20/2012
February 28, 2012 Leave a comment
Mortgage Debt Forgiveness: 10 Key Points
Canceled debt is normally taxable to you, but there are exceptions. One of those exceptions is available to homeowners whose mortgage debt is partly or entirely forgiven during tax years 2007 through 2012.
The IRS would like you to know these 10 facts about Mortgage Debt Forgiveness:
1. Normally, debt forgiveness results in taxable income. However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude up to $2 million of debt forgiven on your principal residence.
2. The limit is $1 million for a married person filing a separate return.
3. You may exclude debt reduced through mortgage restructuring, as well as mortgage debt forgiven in a foreclosure.
4. To qualify, the debt must have been used to buy, build or substantially improve your principal residence and be secured by that residence.
5. Refinanced debt proceeds used for the purpose of substantially improving your principal residence also qualify for the exclusion.
6. Proceeds of refinanced debt used for other purposes – for example, to pay off credit card debt – do not qualify for the exclusion.
7. If you qualify, claim the special exclusion by filling out Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness, and attach it to your federal income tax return for the tax year in which the qualified debt was forgiven.
8. Debt forgiven on second homes, rental property, business property, credit cards or car loans does not qualify for the tax relief provision. In some cases, however, other tax relief provisions – such as insolvency – may be applicable. IRS Form 982 provides more details about these provisions.
9. If your debt is reduced or eliminated you normally will receive a year-end statement, Form 1099-C, Cancellation of Debt, from your lender. By law, this form must show the amount of debt forgiven and the fair market value of any property foreclosed.
10. Examine the Form 1099-C carefully. Notify the lender immediately if any of the information shown is incorrect. You should pay particular attention to the amount of debt forgiven in Box 2 as well as the value listed for your home in Box 7.
For more information about the Mortgage Forgiveness Debt Relief Act of 2007, visit www.irs.gov. IRS Publication 4681, Canceled Debts, Foreclosures, Repossessions and Abandonments, is also an excellent resource.
February 28, 2012 Leave a comment
To see the full interview on CNBC, please click here
February 7, 2012 Leave a comment
“We have jobs,” said Tanya Marchiol of Team Investments, a local real estate investing firm. “Not a lot of big markets like us that went through the bubble have so many jobs.”
The unemployment rate in the metro area fell to 7.7% in November, a 1.1 percentage point improvement from 2010 and better than the national rate of 8.2%.
Home sales have been picking up, thanks to rock-bottom foreclosure bargains. During the fourth quarter, homes sold 27% faster than they did during the same period in 2010, according to Realtor.com.
A four-bedroom, two-bath house in good condition is currently listed for under $80,000, a significant discount from the $200,000 or so it would have fetched during the 2006 peak, said Marchiol.
Even with sales volume and home prices solidifying, Phoenix buyers are not likely to become overnight real estate millionaires. Over the next five years, forecasting firm Fiserv expects local prices to rise at a steady but paltry 2.4% annual average rate.
January 18, 2012 Leave a comment
NEW YORK (CNNMoney) — Federal officials hope to launch a pilot program in early 2012 to convert government-owned foreclosures into rental properties.
The program, which was cited by Federal Reserve Chairman Ben Bernanke last week as one way to address the housing crisis, would sell foreclosed homes now owned by Fannie Mae (FNMA, Fortune 500) and Freddie Mac (FMCC, Fortune 500) to investors in bulk. The properties would then be converted into rentals.
The initiative began back in August, when the Federal Housing Finance Agency, the Treasury Department and the U.S. Department of Housing and Urban Development announced they were seeking suggestions on ways to dispose of repossessed homes now owned by Fannie Mae, Freddie Mac and the Federal Housing Administration.
In addition to getting the properties off the government’s books, officials are hoping putting the homes back into productive use will stabilize neighborhoods and housing values. Also, it is looking to expand the supply of rentals, which are increasingly in demand.
The agency is not releasing details on how the rental program would work, instead saying it is “proceeding prudently but with a sense of urgency to lay the groundwork for the development of good initial transactions in early 2012.”
Administration officials said they are continuing to work with the agency to develop the program.
Until now, most foreclosed homes have been sold individually because investors have demanded bigger discounts to buy large numbers of properties.
But federal officials are warily eyeing the expected surge in foreclosures as banks ramp up their action against delinquent homeowners. The process had been stalled since late 2010 when banks’ shoddy paperwork practices came to light.
There are close to 2 million homes in the late stages of delinquency, according to Lender Processing Services. Since foreclosed properties often sell below market value, they can wreak havoc on home prices.
Converting these homes to rentals can both help the neighborhood and minimize losses to Fannie, Freddie and the FHA, which hold about 250,000 properties, Bernanke told lawmakers last week.
He urged lawmakers to ramp up their efforts to fix the housing market, placing particular emphasis on the problem of vacant homes on the market.
“Restoring the health of the housing market is a necessary part of a broader strategy for economic recovery,” he said.
Bernanke’s comments launched a full-court press by Federal Reserve officials last week to raise awareness of the continuing problems plaguing the housing market.
His proposals were quickly followed by Fed Governors Sarah Bloom Raskin, who spoke on ramping up enforcement of mortgage servicers, and Elizabeth Duke, who said Fannie Mae and Freddie Mac could do more to help heal the housing market.
Meanwhile, New York Fed President William Dudley gave a speech that touched on a wide range of housing policies — including principal reduction and mortgage refinancing — that he believes will boost the economy.
The Fed has already tried to boost real estate sales by pushing mortgage rates down to record lows through massive bond-buying programs.
But the renewed push for housing help indicates that the Fed, which has basically run out of monetary policy ammunition to revive the real estate market, is urging the federal government to ramp up its efforts.
“The Federal Reserve is signaling in even stronger terms the need for the government to do more to help housing,” said Jaret Seiberg, a policy analyst with the Washington Research Group.
January 17, 2012 Leave a comment
NEW YORK (CNNMoney) — Foreclosure filings and repossessions fell to their lowest level since 2007 last year.
Total filings, including default notices and bank repossessions were down 33% for the year to 2.7 million, according to RealtyTrac, the online marketer of foreclosed properties.
One in every 69 homes had at least one foreclosure filing during the year, while 804,000 homes were repossessed. That’s a significant improvement from the peaks reached in 2010 — when 1.05 million homes were repossessed — and the lowest levels seen since 2007.
More than 4 million homes have been lost to foreclosure over the past five years.
While the declines seem like good news for the housing market, where a flood of foreclosed homes has depressed home prices, much of it is due to processing delays caused by fall-out from the “robo-signing” scandal that broke in late 2010.
During the year, banks spent more time making sure paperwork was legal and proper, creating a backlog in the foreclosure pipeline. As a result, the average time it took to process a foreclosure climbed to 348 days during the fourth quarter, up from 305 days a year earlier.
“Foreclosures were in full delay mode in 2011, resulting in a dramatic drop in foreclosure activity for the year,” said Brandon Moore, chief executive officer of RealtyTrac.
However, Moore said there were “strong signs” during the second half of the year that lenders are working through foreclosure backlogs in certain markets. He expects foreclosure activity to rise above 2011′s level but remain below the peak hit in 2010.
Low rates offer some help for homeowners
Early in 2011, many forecasters were predicting a wave of foreclosures due to resetting adjustable-rate mortgages, but low mortgage rates helped many borrowers refinance into more affordable loans, said Moore.
The government helped as well, through efforts like the Home Affordable Refinance Program (HARP), which made refinancing easier for borrowers who owe more on their mortgage than their homes are worth. Government foreclosure prevention programs, including HARP and the Home Affordable Modification Program (HAMP), have started about 5.5 million mortgage modifications since April 2009, according to the U.S. Department of Housing and Urban Development.
“Programs like HAMP and HARP have definitely made a dent in the foreclosure problem,” said Moore “However, they are certainly not living up to their billing of preventing several million foreclosures. In addition, many [HAMP] homeowners fall back into foreclosure later on.”
Of course, there were still plenty of factors working against homeowners in 2011, including the continued erosion in home prices. Falling prices rob homeowners of home equity, which they can tap if they need emergency cash.
Foreclosure hot spots
Hot spots for foreclosures remain mostly in “bubble states,” where speculative investors helped drive up home prices beyond their fundamental values during the mid-2000s housing boom. Nevada, where one out of every 16 households received some kind of default notice during the year, was the worst hit of all, a distinction it has held for the fifth consecutive year. Arizona had the second highest foreclosure rate and California came in third. Florida, which had been running neck-and-neck with the other “Sand States” in past years, fell to seventh, behind Georgia, Utah and Michigan.
Among metro areas, Las Vegas suffered from the highest foreclosure rate in 2011. California put seven cities in the top 10, led by Stockton in the second slot. Other cities in the top 10 included Phoenix, which finished sixth, and Reno, Nev. was eighth.
December 5, 2011 Leave a comment
News from Homesmart CEO, Chuck Lemire.
The monthly cost of owning a home is more affordable now than in the past 15 years, and is less expensive than renting in numerous cities, according to The Wall Street Journal’s third-quarter survey. Apartment rent is expected to rise while mortgages have become more affordable. This is a great opportunity to consider buying a home. The big win: taking a similar monthly payment but putting towards owning a home.
Other cities where owning is now cheaper than renting include Detroit, Minneapolis, Orlando, Las Vegas, Miami, St. Louis, and Chicago.
In the 28 cities that The Wall Street Journal tracked, it found monthly mortgage payments on the median-priced home – including taxes and insurance – to be lower than the average rent levels in 12 of the metro areas. Nationwide, apartment rents are expected to rise by about 4 percent this year, which may make the owning vs. renting picture tilt even higher, according to some analysts.
Meanwhile, rent levels have risen briskly across the country and mortgage rates, hovering around 4%, are the lowest in six decades. Visible inventory was down sharply in several markets, including by almost half in Miami and 40% in Phoenix.
“I care about you, you can trust me and I am committed to excellence.”- Chuck Lemire CEO HomeSmart International
November 9, 2011 Leave a comment
Foreigners seem to have more confidence in the U.S. real estate market than Americans do. Foreigners spent $82 billion buying up U.S. homes in the 12 months.
A new Senate bill would grant a U.S. visa to international investors who agree to spend at least $500,000 on residential real estate here. There are some requirements the eligible foreigner would need to meet for this new “homeowner” visa but it would be a vote of confidence and could improve the housing market nationwide. To read more…
Here is a good video from CNN Money for those that are on the fence about buying in today’s real estate market. It gives a brief insight to the market as a whole and will hopefully guide you in the right direction in your real estate goals.
Tips on cashing in on the housing slump
October 27, 2011 Leave a comment
Home prices are up for 20 major cities but are still below where they used to be according to S&P’s Case-Shiller Home Price Indices, the leading measure of U.S. home prices. Phoenix was included in the research so it is somewhat good news to hear that home prices have risen. Typically the spring and summer housing demands are seasonally strong. With the holidays around the corner and as long as the economy remains weak, foreclosures continue to happen and lending standards tightened, there probably wont be much movement. Here’s a look at Arizona’s seasonal trend in the last 12 months based on the Median Sold List & Sale Price pulled from the Arizona Regional Multiple Listing Service.
