DAILY REAL ESTATE NEWS | THURSDAY, SEPTEMBER 15, 2011
For the 56th straight month, Nevada continued to have the highest foreclosure rate in the country, where one in every 118 homes received a foreclosure filing during August, according to the latest figures from RealtyTrac.
Nationally, 1 in every 570 households received a foreclosure filing in August.
Meanwhile, five states accounted for 53 percent of the foreclosure activity in August, led by California. In California, 59,383 properties received foreclosure filings last month. The state saw a 55 percent month-over-month increase in default notices.
The following are the states that posted the highest foreclosure rates in August, according to RealtyTrac’s latest report:
1. Nevada
One in every 118 households received a foreclosure filing during August.
Total foreclosure filings in August: 9,677
2. California
One in every 226 households
Total foreclosure filings in August: 59,383
3. Arizona
One in every 248 households
Total foreclosure filings in August: 23,569
4. Georgia
1 in every 346 households
Total foreclosure filings in August: 11,743
5. Idaho
1 in every 348 households
Total foreclosure filings in August: 1,860
6. Michigan
1 in every 349 households
Total foreclosure filings in August: 13,016
7. Florida
1 in every 376 households
Total foreclosure filings in August: 23,569
8. Illinois
1 in every 424 households
Total foreclosure filings in August: 12,493
9. Colorado
1 in every 439 households
Total foreclosure filings in August: 4,933
10. Utah
1 in every 450 households
Total foreclosure filings in August: 2,119
By REALTOR® Magazine Daily News
Read More
Mortgage Defaults Soar 33%, Biggest Monthly Gain in 4 Years
Thursday, September 15, 2011
Friday, September 9, 2011
Where Home Prices Have Dropped the Most
California cities have seen their home values drop by the largest percentage in the last five years, with some metro areas posting losses of up to 67 percent in that time period. California cities occupied six of the top 10 metro areas with the largest drops, according to a recent Zillow study based on its home-value estimates and Zillow Home Value Index.
Overall, "there will be many ups and downs in home values before this is over, and we continue to expect a true bottom in 2012, at the earliest,” says Stan Humphries, Zillow’s chief economist. “There are still hazards in the form of a full foreclosure pipeline, high negative equity, and fluctuations in demand."
The following are seven cities that have seen home values drop the most since the housing boom, according to Zillow:
1. Merced, Calif.
July 2011 Zillow Home Value Index: $106,514
Zillow Home Value Index 5 Years ago: $328,813
Value difference (by percent): -67.6%
2. Modesto, Calif.
July 2011 ZHVI: $128,777
ZHVI 5 Years Ago: $352,599
Value difference: -63.5%
3. Stockton, Calif.
July 2011 ZHVI: $150,061
ZHVI 5 Years Ago: $404,036
Value difference: -62.9%
4. Las Vegas
July 2011 ZHVI: $117,084
ZHVI 5 Years Ago: $303,656
Value difference: -61.4%
5. Vallejo, Calif.
July 2011 ZHVI: $190,521
ZHVI 5 Years Ago: $468,071
Value difference: -59.3%
6. Salinas, Calif.
July 2011 ZHVI: $282,289
ZHVI 5 Years Ago: $664,404
Value difference: -57.5%
7. Daytona Beach, Fla.
July 2011 ZHVI: $95,193
ZHVI 5 Years Ago: $220,436
Value difference: -56.8%
See what other cities made it in the top 10 list.
Source: “Five Years After Housing Market Peak, Bumpy Road Toward Stabilization Underway As Home Values Show Recent Rise in Many Markets,” Zillow (Aug. 9, 2011) and “10 Real Estate Markets With the Largest 5-Year Drop in Home Values,” Inman News (Sept. 8, 2011)
Read More
Zillow: Market to Reach Bottom Possibly by 2012
Overall, "there will be many ups and downs in home values before this is over, and we continue to expect a true bottom in 2012, at the earliest,” says Stan Humphries, Zillow’s chief economist. “There are still hazards in the form of a full foreclosure pipeline, high negative equity, and fluctuations in demand."
The following are seven cities that have seen home values drop the most since the housing boom, according to Zillow:
1. Merced, Calif.
July 2011 Zillow Home Value Index: $106,514
Zillow Home Value Index 5 Years ago: $328,813
Value difference (by percent): -67.6%
2. Modesto, Calif.
July 2011 ZHVI: $128,777
ZHVI 5 Years Ago: $352,599
Value difference: -63.5%
3. Stockton, Calif.
July 2011 ZHVI: $150,061
ZHVI 5 Years Ago: $404,036
Value difference: -62.9%
4. Las Vegas
July 2011 ZHVI: $117,084
ZHVI 5 Years Ago: $303,656
Value difference: -61.4%
5. Vallejo, Calif.
July 2011 ZHVI: $190,521
ZHVI 5 Years Ago: $468,071
Value difference: -59.3%
6. Salinas, Calif.
July 2011 ZHVI: $282,289
ZHVI 5 Years Ago: $664,404
Value difference: -57.5%
7. Daytona Beach, Fla.
July 2011 ZHVI: $95,193
ZHVI 5 Years Ago: $220,436
Value difference: -56.8%
See what other cities made it in the top 10 list.
Source: “Five Years After Housing Market Peak, Bumpy Road Toward Stabilization Underway As Home Values Show Recent Rise in Many Markets,” Zillow (Aug. 9, 2011) and “10 Real Estate Markets With the Largest 5-Year Drop in Home Values,” Inman News (Sept. 8, 2011)
Read More
Zillow: Market to Reach Bottom Possibly by 2012
Thursday, August 25, 2011
White House Weighs Mass Refinancing Plan
DAILY REAL ESTATE NEWS | THURSDAY, AUGUST 25, 2011
The White House is considering a housing proposal that would allow millions of home owners with government-backed mortgages to refinance into lower interest rates, The New York Times reports.
“A wave of refinancing could be a strong stimulus to the economy, because it would lower consumers’ mortgage bills right away and allow them to spend elsewhere,” an article in The New York Times notes.
Many home owners have been unable to take advantage of today’s low interest rates — which are averaging around 4 percent — because they don’t qualify for refinancing at the best rates since they owe more on their home than it is currently worth or because of poor credit. The refinancing plan is still under discussion of how it would work, The New York Times said.
“This is the best stimulus out there because it doesn’t increase the deficit, it accomplishes monetary policy, and it reduces defaults in housing,” Christopher J. Mayer, an economist at the Columbia Business School, told The New York Times.
The White House is also considering other options to try to stimulate the housing market or save home owners from foreclosure. Such options include more changes to its refinancing programs so more home owners can participate or a home rental program to that would rent out foreclosures instead of putting them for sale so foreclosures would stop weighing down overall home prices.
Source: “U.S. May Back Refinance Plan for Mortgages,” The New York Times (Aug. 24, 2011)
Thursday, July 28, 2011
Bank: ‘We’ll reduce your loan, you share future appreciation'
NEW YORK – July 28, 2011 – Ocwen Financial Corp., a servicer of residential mortgages, launched a new loan modification program to reduce the principal on a mortgage for delinquent borrowers, but the borrowers must agree to let loan investors share in future appreciation of the home’s value when the market recovers.
Through the Shared Appreciation Modification program (SAMs), Ocwen will write down the principal of the loan to 95 percent of the home’s current market value. The amount written down will then be forgiven in one-third increments over a three-year timespan, as long as the homeowner remains current on the modified mortgage.
Then, “when the house is later sold or refinanced, the borrower must share 25 percent of the appreciation with the investors that own the loan; borrowers keep 75 percent of the gain,” the company notes.
Loan modifications will be available only to homeowners in negative equity.
“Like all modifications, SAMs help homeowners avoid foreclosure. But they also restore equity,” says Ocwen CEO Ronald Faris in a public statement about the program. “That’s a significant benefit to the customer and, we believe, the economy and housing market. Psychologically, it’s important too. Our analytics tell us that an underwater mortgage is one-and-a-half to two-times more likely to default than one with at least some positive equity.”
The program, which is expected to be rolled out into 33 states, is one of the first principal reduction programs started by a private company.
Source: “Ocwen Unveils New Principal Reduction Program,” HousingWire (July 26, 2011) and “Ocwen Offering Mortgage Modifications That Restore Equity for Underwater Borrowers,” GlobeNewswire (July 26, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Through the Shared Appreciation Modification program (SAMs), Ocwen will write down the principal of the loan to 95 percent of the home’s current market value. The amount written down will then be forgiven in one-third increments over a three-year timespan, as long as the homeowner remains current on the modified mortgage.
Then, “when the house is later sold or refinanced, the borrower must share 25 percent of the appreciation with the investors that own the loan; borrowers keep 75 percent of the gain,” the company notes.
Loan modifications will be available only to homeowners in negative equity.
“Like all modifications, SAMs help homeowners avoid foreclosure. But they also restore equity,” says Ocwen CEO Ronald Faris in a public statement about the program. “That’s a significant benefit to the customer and, we believe, the economy and housing market. Psychologically, it’s important too. Our analytics tell us that an underwater mortgage is one-and-a-half to two-times more likely to default than one with at least some positive equity.”
The program, which is expected to be rolled out into 33 states, is one of the first principal reduction programs started by a private company.
Source: “Ocwen Unveils New Principal Reduction Program,” HousingWire (July 26, 2011) and “Ocwen Offering Mortgage Modifications That Restore Equity for Underwater Borrowers,” GlobeNewswire (July 26, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Monday, July 11, 2011
Second chance for owners who lost homes
WASHINGTON – July 11, 2011 – More than 2 million homeowners who were foreclosed on or were in the process of a foreclosure during 2009 or 2010 can now ask for a review of their case, banking regulators announced this week. Banking regulators say ex-homeowners who might be eligible will receive a letter from their lender explaining their rights.
The move is to help identify homeowners who may have been improperly foreclosed upon, Julie Williams, chief counsel of the Office of the Comptroller of the Currency, said at a congressional hearing.
Homeowners who ask for the review will receive a letter explaining their rights.
Mortgage servicers will hire independent auditors to conduct reviews of the cases and determine if homeowners should receive financial compensation if the foreclosures were not done properly. They will also look for borrowers who were denied loan modifications when they may have been eligible for one.
The reviews are part of the mortgage servicer requirements called for by regulators after an investigation last fall revealed improper foreclosure practices by banks. Banks have until Wednesday to submit plans to the OCC on how they plan to revamp foreclosure practices.
Source: “Foreclosed Home Owners May Seek Case Reviews,” USA Today (July 8, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
The move is to help identify homeowners who may have been improperly foreclosed upon, Julie Williams, chief counsel of the Office of the Comptroller of the Currency, said at a congressional hearing.
Homeowners who ask for the review will receive a letter explaining their rights.
Mortgage servicers will hire independent auditors to conduct reviews of the cases and determine if homeowners should receive financial compensation if the foreclosures were not done properly. They will also look for borrowers who were denied loan modifications when they may have been eligible for one.
The reviews are part of the mortgage servicer requirements called for by regulators after an investigation last fall revealed improper foreclosure practices by banks. Banks have until Wednesday to submit plans to the OCC on how they plan to revamp foreclosure practices.
Source: “Foreclosed Home Owners May Seek Case Reviews,” USA Today (July 8, 2011)
© Copyright 2011 INFORMATION, INC. Bethesda, MD (301) 215-4688
Friday, July 8, 2011
Adding office could increase home value
PHILADELPHIA – July 8, 2011 – Remember when the “experts” said that most Americans would telecommute from home offices to work every day?
Hasn’t happened, although ever-evolving technology has made the notion more viable. Think laptops, netbooks, printers, smartphones, and tablets, networked through a wireless router to a high-speed Internet connection.
Thanks to wireless technology, you don’t even need a physical home office – although if you are counting on an income-tax deduction, the IRS requires that space be dedicated to that purpose.
Don’t need the deduction? Then “the home office is everywhere,” said Steve Melman, director of economic services at the National Association of Home Builders.
About 2 percent of U.S. workers – the self-employed and unpaid volunteers excluded – consider home their primary workplace, the Telework Research Network says. It estimates that 20 million to 30 million people work from home at least one day a week.
That’s hardly everyone, though it is more than the Bureau of Labor Statistics’ 2001 figure of 19.5 million.
Two additional factors have had a huge effect on the number of home offices: the flagging economy and an overall demand for affordability that has resulted from it.
Members of the home builders’ group were surveyed at the end of 2010 about what new homes might look like in 2015, Melman said.
The consensus: Homes will be smaller, and “people will be looking for real value, with the walk-in closet and the laundry room at the very top of the list of features.” Most future homebuyers (read: younger buyers) will use the portability of electronic devices to “make the most of less square footage.”
That’s a far cry from the home-office-as-emerging-trend of the 1990s, when telecommuting depended on having a work space that could accommodate, in addition to desk and chair, a telephone, a desktop computer, a modem, a printer, a file cabinet and storage for floppy disks (remember those?).
When the need for data speed overwhelmed standard wiring, Category 5, an advanced system providing Internet access at speeds 200 times faster, required owners of older homes to rip open walls to upgrade their service. Newly built homes had the less expensive advantage, until wireless technology leveled the playing field.
Today, for about $60, a single-band wireless router allows you to create a building-wide network of computers, printers, and other devices linked to a single Internet source – a cable modem.
Access to the router can be made secure within the network, so you can do online financial transactions safely. Some cable-modem providers offer free antivirus software that can be downloaded to each computer through the network. Every computer can be networked through a single printer, wireless or not.
But all routers are not created equal, and online shopping is a good idea. An excellent guide can be found at http://is.gd/lggFIj. Most manufacturers offer free upgrades to their firmware, the internal programs that run these devices, so keep in touch with their websites.
If you run a business from home, or take a lot of work home, you probably will want dedicated space somewhere – a quiet somewhere. Design the space for yourself, keeping the costs within a reasonable budget, rather than with resale in mind.
In 2007, Remodeling magazine’s annual Cost vs. Value report said a home-office renovation would return 56.1 percent of your investment at sale time. This year, that was down to 45.8 percent.
If you’ll be working for long periods in your home office, think ergonomically. A good source of information about furniture and design is at http://is.gd/epQjQA. Lighting a home office is tricky. The American Lighting Association offers tips at http://is.gd/l8GUls.
You’ll need plenty of grounded electrical outlets and a surge protector for your equipment – one with a high joule rating (the higher the rating, the longer protection will last) – with phone-line and coaxial-cable jacks, too. Get a printer with copier, fax, and scanner functions.
Choice of computer is up to you – shop for the best deal, warranty protection, and service guarantee. If you will be doing a lot of conferencing from your home office, a Web camera is a must.
Depending on how much data are involved in your job, an external hard drive of 250 gigabytes or more should be weighed against online backup for a fee, as discussed in PC magazine at http://is.gd/XZr601.
The problem with technology, of course, is that it evolves faster than our thinking about how to use it. “Remember, even the computer experts had no idea what to do with email,” Melman said.
Copyright © 2011
Hasn’t happened, although ever-evolving technology has made the notion more viable. Think laptops, netbooks, printers, smartphones, and tablets, networked through a wireless router to a high-speed Internet connection.
Thanks to wireless technology, you don’t even need a physical home office – although if you are counting on an income-tax deduction, the IRS requires that space be dedicated to that purpose.
Don’t need the deduction? Then “the home office is everywhere,” said Steve Melman, director of economic services at the National Association of Home Builders.
About 2 percent of U.S. workers – the self-employed and unpaid volunteers excluded – consider home their primary workplace, the Telework Research Network says. It estimates that 20 million to 30 million people work from home at least one day a week.
That’s hardly everyone, though it is more than the Bureau of Labor Statistics’ 2001 figure of 19.5 million.
Two additional factors have had a huge effect on the number of home offices: the flagging economy and an overall demand for affordability that has resulted from it.
Members of the home builders’ group were surveyed at the end of 2010 about what new homes might look like in 2015, Melman said.
The consensus: Homes will be smaller, and “people will be looking for real value, with the walk-in closet and the laundry room at the very top of the list of features.” Most future homebuyers (read: younger buyers) will use the portability of electronic devices to “make the most of less square footage.”
That’s a far cry from the home-office-as-emerging-trend of the 1990s, when telecommuting depended on having a work space that could accommodate, in addition to desk and chair, a telephone, a desktop computer, a modem, a printer, a file cabinet and storage for floppy disks (remember those?).
When the need for data speed overwhelmed standard wiring, Category 5, an advanced system providing Internet access at speeds 200 times faster, required owners of older homes to rip open walls to upgrade their service. Newly built homes had the less expensive advantage, until wireless technology leveled the playing field.
Today, for about $60, a single-band wireless router allows you to create a building-wide network of computers, printers, and other devices linked to a single Internet source – a cable modem.
Access to the router can be made secure within the network, so you can do online financial transactions safely. Some cable-modem providers offer free antivirus software that can be downloaded to each computer through the network. Every computer can be networked through a single printer, wireless or not.
But all routers are not created equal, and online shopping is a good idea. An excellent guide can be found at http://is.gd/lggFIj. Most manufacturers offer free upgrades to their firmware, the internal programs that run these devices, so keep in touch with their websites.
If you run a business from home, or take a lot of work home, you probably will want dedicated space somewhere – a quiet somewhere. Design the space for yourself, keeping the costs within a reasonable budget, rather than with resale in mind.
In 2007, Remodeling magazine’s annual Cost vs. Value report said a home-office renovation would return 56.1 percent of your investment at sale time. This year, that was down to 45.8 percent.
If you’ll be working for long periods in your home office, think ergonomically. A good source of information about furniture and design is at http://is.gd/epQjQA. Lighting a home office is tricky. The American Lighting Association offers tips at http://is.gd/l8GUls.
You’ll need plenty of grounded electrical outlets and a surge protector for your equipment – one with a high joule rating (the higher the rating, the longer protection will last) – with phone-line and coaxial-cable jacks, too. Get a printer with copier, fax, and scanner functions.
Choice of computer is up to you – shop for the best deal, warranty protection, and service guarantee. If you will be doing a lot of conferencing from your home office, a Web camera is a must.
Depending on how much data are involved in your job, an external hard drive of 250 gigabytes or more should be weighed against online backup for a fee, as discussed in PC magazine at http://is.gd/XZr601.
The problem with technology, of course, is that it evolves faster than our thinking about how to use it. “Remember, even the computer experts had no idea what to do with email,” Melman said.
Copyright © 2011
Tuesday, June 28, 2011
The Better Bargain: Foreclosure or Short Sale?
Short sales and foreclosures have flooded the housing market in recent years, and buyers are often drawn to the bargain prices but may be hesitant to jump into what usually is a difficult transaction and a long process.
Bankrate.com recently tackled the question of “Which to Buy: Short Sale or Foreclosure?” in an article that helps buyers weigh the pros and cons of a distressed property. Experts note that the question largely depends on buyers' situations, how quickly they need a home, and their tolerance for fixer-uppers.
Foreclosure Pros and Cons
Buying a foreclosure is often faster than purchasing a short sale. Plus, buyers often can negotiate closing costs and price in foreclosure sales, Elaine Zimmermann, a real estate investor in Memphis, Tenn., told Bankrate.com.
However, abandoned homes in foreclosure can deteriorate very quickly so the buyer may need to weigh the condition of the home and whether they want a fixer upper. Scarred walls and carpets and appliances that were damaged by the former owner are not uncommon in a foreclosure, says David Richardson, an inspector in the Detroit area who's certified by the American Society of Home Inspectors.
Short Sales Pros and Cons
A short-sale home is still owned by the occupant, so it tends to be in better condition than a foreclosure, experts say.
"The short sale is, in my opinion, far better than buying a foreclosure because the home is generally in better condition because it's been occupied," says Gwen Daubenmeyer, a certified distressed property expert with RE/MAX in Detroit. "The utilities have been maintained, usually the lawn is maintained, those kinds of things."
But short sales often can take a longer time than a foreclosure to close. However, the federal Home Affordable Foreclosure Alternatives program, or HAFA, may be able to help speed up the short-sale process since it has created a timeline to hold mortgage lenders accountable, but still “it’s not perfect by any means,” Daubenmeyer says.
Source: “Which to Buy: Short Sale or Foreclosure?” Bankrate.com (June 2011)
Bankrate.com recently tackled the question of “Which to Buy: Short Sale or Foreclosure?” in an article that helps buyers weigh the pros and cons of a distressed property. Experts note that the question largely depends on buyers' situations, how quickly they need a home, and their tolerance for fixer-uppers.
Foreclosure Pros and Cons
Buying a foreclosure is often faster than purchasing a short sale. Plus, buyers often can negotiate closing costs and price in foreclosure sales, Elaine Zimmermann, a real estate investor in Memphis, Tenn., told Bankrate.com.
However, abandoned homes in foreclosure can deteriorate very quickly so the buyer may need to weigh the condition of the home and whether they want a fixer upper. Scarred walls and carpets and appliances that were damaged by the former owner are not uncommon in a foreclosure, says David Richardson, an inspector in the Detroit area who's certified by the American Society of Home Inspectors.
Short Sales Pros and Cons
A short-sale home is still owned by the occupant, so it tends to be in better condition than a foreclosure, experts say.
"The short sale is, in my opinion, far better than buying a foreclosure because the home is generally in better condition because it's been occupied," says Gwen Daubenmeyer, a certified distressed property expert with RE/MAX in Detroit. "The utilities have been maintained, usually the lawn is maintained, those kinds of things."
But short sales often can take a longer time than a foreclosure to close. However, the federal Home Affordable Foreclosure Alternatives program, or HAFA, may be able to help speed up the short-sale process since it has created a timeline to hold mortgage lenders accountable, but still “it’s not perfect by any means,” Daubenmeyer says.
Source: “Which to Buy: Short Sale or Foreclosure?” Bankrate.com (June 2011)
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