Coldwell Banker survey and commentary by Dr. Robi Ludwig on the value of homeownership.

Interesting that the emotional value of homeownership doesn’t change and some of the reasons why.  It really hit me that that we need to be “rooted” in order to feel like life has meaning and that we are safe.

Here’s a tool from CNN/Money to predict the change in various real estate markets.

Corvallis, OR Metropolitan Statistical Area:

• Forecast change: second quarter, 2011 – second quarter, 2012 +3% 
• Forecast change: second quarter, 2012 – second quarter, 2013 +9.9%

This tool tracks 384 markets. It will be interesting to see what actually happens.

Track a market near you: Home Price Data on 384 Markets

Corvallis, Oregon ranked 73rd in improving housing markets index.

According to the National Association of Home Builders/First American Improving Markets Index (IMI), released 5/7/2012 Corvallis, Oregon is listed as one of the  housing markets showing measurable and sustained improvement.

The index takes into uses three independent montly data factors – employment growth (Census), house price growth (Freddie Mac) and single-family housing growth (Census) to identify the top improving markets.

Cities in the Northwest include:

• Bend, OR (newly added and ranked 72)
• Corvallis, OR (73)
• Portland, OR  (74)

View the full report: NAHB/First American Improving Markets Index (IMI)

Very proud to see that Realogy is included as one of the World’s Most Ethical (WME) Companies.

Realogy is the parent company for Coldwell Banker.  Another good reason to be affiliated.  Check out the original post: List of World’s Most Ethical Companies

Is A New Home On Your Gift Registry?

If you’re planning to get married and buy a home, but wonder where your down payment funds will come from, FHA might have a solution for you.

FHA has a Bridal Registry program that allows the money you receive as a wedding gift to be used towards your down payment. With this special program, friends and family can now give you something you really want – money for your first home! Forget Crate & Barrel and Macy’s and achieve your dream of homeownership.
Here’s how it works:

• Inform your mortgage professional of your intention to obtain all or part of your down payment from gifts to the “bridal registry” account
• Open an interest bearing account at any FDIC insured bank prior to the wedding;
• Spread the word to friends and family;
• Keep a ledger of the funds and who they are from;
• All of the gift funds can go towards the FHA required 3.5% down payment;
• There is no requirement that you be married prior to closing on your new home
• Change in plans? Withdraw the money and use as you wish

It’s that simple! The sooner you open your Gift Registry Account, the quicker the funds can accumulate.

This guest post was provided by

Holly Smith
Senior Mortgage Banker
MLO-211163

Pacific Residential Mortgage, LLC
2405 14th Ave. SE, Suite C
Albany, OR  97322

Office (541) 791-2612 ext 202
Cell (541) 740-3777
Fax (541) 791-2625
Toll Free (800) 207-7984
Driving directions to my office

Foreclosure numbers–A Comparison

We often hear the numbers and think how bad it is. What if you look at the opposite side?  How bad is it?

There are approximately 61,800,000 homeowners in the US

One third, that’s 33%, of US homeowners own their homes free and clear—that’s right, no mortgage.

Nationally, 3.4% of mortgages are in foreclosure (approximately 1,400,000). This percentage is only measured against homes with mortgages. That means that 96.6% (approximately 41,200,000) of homeowners with mortgages are not in foreclosure.

Of all the homeowners in the country 60,400,000 (or 97.7% of all homeowners) are not in foreclosure.

Of course, on a home-by-home, family-by-family basis, any foreclosure is a crisis. But, the numbers from a statistical “big picture” standpoint need perspective. 

Related Link: The Inventory Of Foreclosed Properties Has Begun To Shrink…

Note: A property moves into the foreclosure inventory when the mortgage servicer places the property into the foreclosure process after serious delinquency is reached and remains there until the foreclosure is completed.  Calculations assume that information provided by CoreLogic is accurate. Some variance is numbers results from rounding in calculations.

Homeowner Relief and the $25-billion Foreclosure Deal

Is this another case of “I’m from the government and I’m here to help” or will it really help? Is this another pit of money that tax payers and the American public will fund? Only time will tell…

Some points I’ve gleaned from the reporting:

• This is in part “restitution” from large mortgage servicers for improper practices during the foreclosure process. (In my opinion, this will create an expense to the lenders that will be paid for by increasing costs to other consumers–odds are not on the side of the lenders taking less profit.) 
• The settlement creates new “standards” for mortgage servicing to be overseen by and independent monitor (aside: is this just another bureaucratic layer?)
• One aspect that appears to be quite helpful is that consumers will have one point of contact when working with their lenders toward loan modifications.  The Washington Post reported that the lenders will not continue to process foreclosures and modifications at the same time on the same loan.
• The lenders have agreed to devote billions of dollars to partially compensate people that lost their homes and help current homeowners avoid foreclosure.
• There is $17 Billion earmarked as principal reductions (paying down the loans) for about 1 million homeowners.
• $5 billion in cash is designated as restitution for foreclosure paperwork problems and other issues with the servicers.  1.5 Billion of the state money will be distributed directly to people whose home were foreclosed between 2008-2011 and there was a problem with the way the process was handled (lost documents, robo-signing).  The average check would be between $1,500-2,000.
• 9 additional servicers have been asked to sign-on to the agreement; if they did the dollar figure could go as high as $45 billion.
• Loans that are owned/serviced by Fannie Mae and Freddie Mac are not eligible (Fannie Mae and Freddie Mac are by far the largest servicers of mortage loans in the country, this will narrow the field of those able to take advantage of the settlement significantly)
• The settlement is said to address civil claims it does not prevent pursuit of criminal actions at a federal or state level.

All of this is well and good, provided the funding goes to those that were really harmed or are in need.  But, history often repeats itself.  What I’d like to not see is a process fraught with fraud (those not harmed benefiting), a process that is not bogged down in bureaucracy, and huge piles of money ear-marked to help people that end up absorbed into the overhead of the process.

Further, early in the melt-down, there were reports of abuses in the loan origination process that involved borrowers submitting fraudulent loan applications.  A couple of examples might be: 

• Flippers that took loans intended for primary residences when they really did not intend to do so or borrowers that used “stated income” and inflated their income just to qualify.
• Those that filed fraudulent loan applications and then lost their properties to foreclosure, should not benefit from this settlement.
• People that refinanced took the cash and then defaulted
• People that took “strategic” default as a way “out” by buying a replacement property then walking.

Related Links:

LA Times Story

Washington Post Story

The Settlement An overview

I picked up a couple of interesting bits of news this week about the economy. Thought I would share:

Last week’s Pending Home Sales index from the National Association of REALTORS® (nar) went up 7.3% in November, the highest level since April of 2010.  The 2010 numbers were pumped up because of buyers that were in the market to take advantage of home buyer tax credits available then, that are not available now.

NAR chief economist, Lawrence Yun (and one of Inman’s 100 most influential)  said,  “Housing affordability conditions are at a record high and there is a pent-up demand from buyers who’ve been on the sidelines,  but contract failures have been running unusually high. Some of the increase in pending home sales appears to be from buyers recommitting after an initial contract ran into problems, often with the mortgage”.

I think that some some contract failures are preventable, especially when both the buyer and seller want to see the transaction through — having the right team in place, real estate professional, lender and title/escrow in place, can make a huge difference on an individual basis. Local markets and individual circumstances drive the reasons for contract failures.

According to NAR, It should be noted that “Pending home sales are not affected by the recently published rebenchmarking of existing-home sales because the index uses a different methodology based directly on contract signings, and is adjusted for seasonality.

and

According to USA Today, news sources and the Bureau of Labor Statistics, the, U.S. unemployment numbers are the lowest in 3 years.  “The U.S. job market strengthened in the second half of 2011 and added 200,000 jobs in December while the unemployment rate fell to 8.5% from a revised 8.7% a month earlier.”

Bright spots.  I’m looking forward to serving your Real Estate needs to 2012.  If you have questions about Corvallis, Albany, Philomath or other mid-Willamette Real Estate feel free to get in touch.

Contact Dava

Broker tour

Q. What is Broker Tour?

A. Broker Tour is a time when sellers make it easy for Brokers to see properties that are on the market.  The “tour” is a process by which brokers can look at properties without making prior arrangements.  In the Corvallis, Albany and Philomath areas the agents let themselves into homes that are pre-set; in some areas, like Lebanon or Sweet Home there is a “caravan” type tour that is rigorously scheduled and the agents group together and all go in a few cars at once.

Q. How does this process work? 

A. The listing agent sets the tour time up in the MLS system. In Corvallis, Philomath and Albany brokers “tour” on Wednesdays. The time of the tour is flexible, but most commonly around 9:00 am until early afternoon.  One of the nice features about the way we tour here is that we can flex a little and work around our client’s schedules and needs. Other areas have different methods, for instance in Lebanon the tour is more of a “caravan” with a list of pre-scheduled properties.  Additionally, some offices have an established “office tour” which may or may not be established as part of their office meeting agenda.

Q. Which properties are on tour? 

A. Tour is often comprised of the “new” listings for the week. Sometimes a “new” property  has been on the market for a while (days or even weeks) before it is scheduled for tour.  Sometimes homes that have already been on tour once are re-set for additional tours. Generally, those homes have had a “change” like in price or décor.  Occasionally, the first tour had a poor turn-out, so it’s re-set to give the brokers another chance to see the property.  It’s never a bad thing to let brokers have easy access to preview a property.  Broker tour is a little like “open house” just for agents.

Q. Why is it beneficial for brokers to tour?  

A. This is a chance to see the property and be familiar enough to discuss it with clients.  Sometimes, brokers tour with a specific client in mind, other times not. It is also a way to become familiar with the market, understand the various homes that are for sale and associate a price point with them.  This is also a social opportunity, brokers on tour often cross paths and has a chance to talk with colleagues, exchanging ideas and needs.

Q. Why didn’t more agents tour my home?

A. There could be any number of reasons why some agents didn’t tour. Often it’s because they have conflicts in their work schedule. It’s possible that they’ve seen the house (either on tour previously or even when it was on the market in the past).  Sometimes the time that is set is not practical or long enough to allow them to see every property.  Rural properties are often under-toured due to drive times etc.  There may have been a number of properties on tour and the volume made it impossible to see them all. Some brokers only tour if they have a client that may match a property, some never tour at all.

Q. What about a luncheon or give-away?

A.  A lot of brokers offer luncheons or give-a-ways with the idea in mind that more brokers will tour the home.  It’s my opinion that the brokers that need to see a specific home, make a point to visit with or without incentives. 

According to a recent survey by Trulia¹ the American Dream of homeownership is alive and well.  

One interesting fact to me is that the number one concern of potential home buyers is the ability to save up a sufficient amount for a down payment. 

I find this  a bit ironic given the political trend to create an environment of even higher downpayments. As recently as this spring, regulatory agencies were working on rule making that would further increase the downpayment requirments. This was covered by The National Association of REALTORS^® (NAR) in REALTORS® Oppose High Down Payment Requirement for Qualified Residential Mortgage Exemption . 

The survey also covers the age demographics and ideal home sizes and locations.  Interesting information.  It’s worth a look.

 ¹ Trulia is a major site that provides information about real estate and homes for sale and rent