Posts Tagged ‘Foreclosed Properties’
Bulk Foreclosure Sales Could Cause Bigger Bank Write-Downs
As government, federal regulators and big-money private investors try to figure out a plan for bulk sales of foreclosed properties, big banks are already making deals, but they are few and far between.
Flood of Foreclosures Heading to Housing Market
New foreclosure starts rose sharply in August, signaling a slew of foreclosed properties will be dumped on the already bloated housing market in early 2012.
Huge Jump in Housing Starts Does Not Point to Solid Recovery
How could anyone take pot shots at a nearly 15 percent monthly jump in anything, not to mention housing starts, which have been mired in the mud for ages now? Apparently pretty easily. I knew the moment I saw the number that there would be those arguing that any gain in new home construction is a negative because of the already bloated inventory of new, existing and foreclosed properties on the market.
Who Will Buy the Foreclosures?
Not to sound like a broken record, but only when we work through the vast inventory and shadow inventory of foreclosed properties, can home prices bottom and housing overall recovery. Obviously certain states/markets are more burdened by the distress than others, but it's a universal truth.
Short Sales Pressure Home Prices
Home prices fell 6.7 percent in February year over year, according to a new report from CoreLogic. That numbers includes distressed sales, that is, sales of foreclosed properties or short sales, where the bank agrees to let the homeowner sell for less than the value of the mortgage. If you take those sales out, however, home prices were basically flat.
Fannie Mae offers new closing incentive
Fannie Mae today announced a new seller-assistance incentive for Fannie Mae-owned properties that are listed on the company’s REO website, http://www.homepath.com/ – and it offers an incentive to real estate agents and brokers. Agents representing owner-occupants will receive a $1,500 bonus, while homebuyers who will live in the house can receive up to 3.5 percent of the final sales price that can be used toward closing costs, including a home warranty. Eligible offers must be submitted on or after Sept. 23, 2010, and must close by Dec. 31, 2010. The sale must also close within 60 days of offer acceptance. “More than 87,000 families purchased HomePath properties in the first half of 2010 – nearly double the number of Fannie Mae foreclosed properties sold in the first half of 2009,” says Terry Edwards, executive vice president of Fannie Mae’s Credit Portfolio Management. “We continue to look for ways to stabilize neighborhoods and offer incentives to qualified buyers.”
Economic outlook: Jobs key to home sales
Millions of Americans – and others, perhaps – are watching mortgage interest rates hit historical lows and mumbling about how very bad the timing is. With the housing market flush with foreclosed properties and long-term interest rates scraping 4.5 percent – 30- and 15-year loans set record lows six weeks in a row this summer – the American Dream of a domicile with a white picket fence in a quiet neighborhood is within the grasp of more people than ever, if only affordability could be a little better timed. As home sales held their own last year, the National Association of Realtors® pointed out that the $8,000 first-time homebuyer federal tax credit was, indeed, priming the pump. And the numbers were telling. As the first deadline for the tax credit came and went, a crush of buyers lined up for loans. When Congress extended the credit through April of this year, sales went through a second cycle of popularity, which ended predictably and precisely as the tax credit again came to a close. In July, without the government’s help, the sale of existing homes fell 27.2 percent compared to June with the annual rate of home sales plunging to 3.83 million, well below expectations. The NAR, which released the figures, promptly pointed out that this new reality was how the market looked without the emperor’s new clothes – without, that is to say, the artifice of a tax credit to parade down Main Street. By the numbers, first-time homebuyers fell to 38 percent of all buyers in July from 43 percent in the previous month. In that sense, it is easy to shed crocodile tears for the tax credit, but some pundits are looking past that and hoping the government will stay out of the way and let the market do its ugly thing. Home prices held up in July, a silver lining in the collapse that may be temporary, as many expected prices to start falling. The Washington Post quoted Mizuho Securities Chief Economist Steven Ricchiuto as saying, “Homes are still being priced without taking into proper consideration the balance sheet of the consumer. What consumer would buy them when they can’t afford them?” That’s right: What the NAR calls a high rate of affordability now is the very definition of moot. After all, even consumers know you don’t apply for a loan when you are out of work. The tax credit? Congress can slap that back into place before their morning coffee cools down. What needs fixing now is the job market, rising employment rates being, perhaps, the surest cure to deflation in an otherwise haphazard arsenal of government options. Copyright © United Press International 2010, Anthony Hall
Habitat for Humanity rehabbing foreclosed homes
Long known for building homes from scratch for the needy, Habitat for Humanity has begun doing rehab work on the nation’s growing inventory of foreclosed houses. With funding from the federal government, Habitat and other local not-for-profit contractors are buying up and remodeling foreclosed properties in Broward and Palm Beach counties. A partnership with the cities of Sunrise, Hallandale and North Lauderdale has allowed Habitat to acquire and rehabilitate 22 foreclosed homes, said Jason Crush, executive director of Habitat of Humanity of Broward County. Funding comes largely from the Neighborhood Stabilization Program, which is underwritten by the Department of Housing and Urban Development and aims to help areas hurt by foreclosed and abandoned properties. Sunrise Mayor Roger Wishner noticed many homes in Sunrise that are neglected. “It’s a great concern, that really hurts a neighborhood,” he said. Wishner said that allowing Habitat to use some of the money from the stabilization grant has enabled the city to save 20 to 25 percent in administration costs – money, he said, that can go to rehabilitating homes. Habitat, founded in 1976, uses volunteer labor and “sweat equity” from owners to reduce construction or rehab costs. Crush said that after the houses are remodeled, families waiting for placement within the program will be able to move in. Deidre Johnson, 38, of Lauderhill, is a single mother of a 14-year-old son and is living with her brother. She is currently working off the sweat equity of her home, a phase where the future homeowner accumulates credit by volunteering 200 to 500 hours on Habitat projects. “Words cannot express it ... I am blessed,” Johnson said referring to the chance of owning a home. “I just want to call a home ‘my home.’” She has been involved with the program since March and could be placed in one of the rehabbed homes after her requirements are met. Habitat Broward pays an average of $75,000 for a foreclosed property, Crush said, and puts another $40,000 into a complete rehabilitation. Volunteers began working on the first foreclosed property, on Southwest 19th Manor in North Lauderdale, on July 31. The home’s interior will be completely remodeled, and it will have a renovated roof and back porch, said site supervisor Mark Chatlos. He expects the remodeling of the home to be finished in three months. The home, which has been vacant for two years, posed a safety risk to the local neighborhood and reduced property values for other houses on the block, said Christi Rice, spokeswoman for Habitat Broward. “Our goal is to turn it into a safe, affordable home for one of our families, while at the same time helping to improve the entire surrounding neighborhood,” Rice said. In South Florida, nearly 50,000 properties are expected to go through foreclosure this year, part of a group of more than 1 million nationwide. Habitat for Humanity of North Palm Beach will also be remodeling foreclosed homes as part of a consortium led by the Lake Worth Community Redevelopment Agency, said Don Kula, construction manager for Habitat Palm Beach. The Lake Worth CRA leads a program of 20 nonprofit organizations with the goal of improving 130 properties in three years as stipulated by a $23.2 million stabilization grant it received earlier this year, said Mike McManaman, an administrator for the Lake Worth CRA. The goal of the grant money is to put mid-income families in homes and to put foreclosed properties back on the tax roll, he said. Kula said he expects Habitat Palm Beach will remodel 30 homes as part of the program and will begin renovations as soon as the Lake Worth CRA begins closing on the properties. He said construction will be up and running this quarter. Aside from remodeling foreclosed properties, the organization will extend its services to the property’s surrounding neighbors. Volunteers will be available to help neighbors with different types of exterior renovations such as painting the house or fixing a broken front door, Kula said. He added that at most, neighbors seeking help would have to pay the cost of the materials. Adopt-a-Family of the Palm Beaches is also working with the Lake Worth CRA. The group expects to remodel 50 homes, half being for ownership and the other half being for rental, said CEO Wendy Tippett. “This will provide a great pool for low-income folks to have safe housing,” she said. Crush said that Habitat has enough vacant land to build 35 single-family homes, but going forward it will mainly rehabilitate existing properties due to the lack of available of empty land in Broward County. “We’ve land banked enough for the next couple of years, but we are going to have to do rehabs,” said Crush. Crush added that the process for placing families has had to speed up due to the deadlines imposed by HUD through the grant. In the future, families will be placed at a normal pace in either a new home or a rehabilitated home. As the sub-prime mortgage crisis shackled commercial builders, Habitat for Humanity for the first time became one of the 10 largest contractors nationwide, joining names such as Lennar Corp. and Pulte Homes. It closed 5,294 sales in 2009, ranking it eighth in Builder magazine’s top 100 list. Crush said he thinks that future homeowners will take well to the rehabilitated properties. “ are happy to be in a situation where they can live in the same place, and they can take ownership and have pride in that ownership,” he said. Copyright © 2010 Sun Sentinel, Fort Lauderdale, Fla., Jorge L. Valens. Distributed by McClatchy-Tribune Information Services.
Foreclosure Math: Shadow Inventory Adds Up
If we know exactly how much shadow inventory of foreclosed properties will come to market, and we know the general demand, then we can get an idea of how much pain there is ahead in the still-fragile housing recovery.
Things Buyers Should Know About FHA Foreclosures For Sale
For investors and regular home buyers who are interested in purchasing FHA foreclosures for sale, there are certain things that they need to know first to make sure that the whole deal goes smoothly and that they end up with a great purchase and a quality property. Knowing the rules governing these types of foreclosures will also help them determine whether it is the kind of deal that suits their needs and requirements. Repair Escrows and Closing Costs Since most FHA homes, like other foreclosed properties, require repairs and renovations, the Federal Housing Administration provides repair escrows and allocations to help buyers renovate or refurbish the property. This allows them to increase their escrow accounts and finance necessary fixes caused by theft, vandalism and other factors that put a foreclosed property in a less-than desirable condition. In addition, the FHA also allows closing costs that can reach up to one percent of the purchase price to be included into the FHA-provided mortgage. This makes it easier for investors and private home buyers to purchase such properties, particularly those that are sold through short sales. Incentives and Mortgage Relief Buyers of FHA foreclosures for sale are provided with certain incentives and are allowed to modify mortgage plans to suit their capabilities to pay. Financing assistance is also offered to certain home buyers, particularly those who have good credit records. Net valuations for the homes also vary, depending on the period within which the house is sold or purchased by the buyer. Home buyers who are interested in these government-supported foreclosed residences are advised to consult with government-provided home counselors to find out more about such properties. These counseling services are free and can help buyers understand better how such deals work. Hiring a real estate agent to work on the agreement and find suitable properties are also recommended. For people interested in purchasing FHA foreclosures for sale, rules and incentives that are in place will help them acquire a great purchase deal. It is necessary for buyers to exert effort to understand these rules to be able to take advantage of the many benefits that these deals offer. Joseph B. Smith has been educating buyers on the finer points of FHA foreclosures for sale at ForeclosureDeals.com for over ten years. Contact Joseph B. Smith through ForeclosureDeals.com if you need help finding information about FHA foreclosures for sale.
