Just yesterday, I decided to check out some stats on the active distressed real estate listings within our local MLS (Multiple Listing Service).
The area searched was approximately 25% of Pinellas County, which is a good representation of the general marketplace.
The initial look at the numbers of sales in each category over the past 90 days was nothing extraordinary.
Foreclosures- 52 sales
Short Sales- 69 sales
However, the truth is evident when you look behind the numbers at the length of time these properties are spending on the market!
Foreclosures- 13 of 52 listings were on the market over 90 days, and only 1 on the market over 1 year.
Short Sales- 53 of 69 listings were on the market over 90 days! Seven listings were on the market for over one year!
Even though the marketing time of short sales is lengthy, the real shock is when looking at active listings- properties currently listed for sale and classified as foreclosure and short sale.
Active Foreclosure listings - 34.
Of these, 9 have been on the market longer than 90 days. The longest DOM (Days on Market) was for ONE listing at 193 days.
Active short sale listings - ARE YOU SITTING DOWN???? 342
That's right, TEN TIMES the number of FORECLOSURES on the market. But, as any infomercial hawker will tell you, WAIT - THERE'S MORE!
Of the 342, 196 of these have been on the market longer than 90 days, and 36 listings have been on the market over one year.
The listing with the longest DOM? 966 days
So, what do YOU think- are SHORT SALES the answer to finding a great deal? These numbers seem to indicate otherwise.
For the latest list of local foreclosures, please visit my website and see the "Foreclosures" page.
http://www.mypinellasparadise.com/
Have a great week!
Wednesday, August 12, 2009
Tuesday, August 11, 2009
Wednesday, August 5, 2009
Financing distressed real estate - Chapter Two
Another critical hurdle to financing a home these days is the HVCC, or Home Valuation Code of Conduct. This agreement between NY's Attorney General Mario Cuomo and FNMA (Federal National Mortgage Association), is wreaking havoc on an already devastated housing market, and just in time to lengthen recovery time.
The legislation, which went into effect May 1, requires a different procedure for ordering property appraisals on behalf of mortgage applicants, in an attempt to avoid fraudulent values.
While I could write a book about the issues involved with HVCC, the highlights that affect BUYERS are as follows:
1. More costly to borrowers in terms of both time and money. Appraisals now take longer since there are more people involved, including an appraisal management company. This can mean purchase contract closing date extensions, interest rate lock extensions and changing moving dates and reservations, etc, etc..
2. Another way the HVCC increases costs for borrowers is the increased likelihood that the lender will require additional reviews of the appraisal once it has been received, again at the expense of the borrower, not the lender.
3. Some appraisers are timid, or maybe just are not familiar with the geographical area and local market trends. If mistakes are made on the appraisal, this may force the borrower to go to another lender and start over. It is VERY difficult to make corrections, no matter how logical and simple it may seem, once an appraisal report has been received by the lender.
Thomas Pierce, of www.examiner.com, sums it up best in his July 29 article titled "New appraisal regulations harm consumers", when he stated,
"This is still yet another example of a political figure with just enough knowledge of the mortgage industry to be dangerous unleashing a series of unintended consequences which ultimately harm the consumer".
www.examiner.com/x-18018-Boston-Mortgage-Industry-Examiner
Several trade groups, such as NAR (National Association of Realtors, www.nar.org ) and NAMB (National Association of Mortgage Brokers www.namb.org ) are currently objecting to HVCC and trying to open a review and dialog about how this practice is affecting the entire housing industry. Until the problems associated with HVCC are addressed and resolved, expect continued red tape when trying to get your next mortgage.
So, how does this pertain to buying distressed property? The HVCC applies to all mortgage transactions completed by lenders who sell or service loans for both FNMA and FHLMC (Federal Home Loan Mortgage Corporation), which is the overwhelming majority with the closing of hundreds of other mortggae loan channels.
However, in addition to this hurdle, some lenders simply will not finance a foreclosure property, or a short sale property. And they are within their rights to set this policy, as unfair as it seems to a well-qualified buyer looking for mortgage money.
Basically, it comes down to the #1 rule in mortgage lending: The Golden Rule, meaning whoever has the gold makes the rules!
Have a great week!
www.mypinellasparadise.com
The legislation, which went into effect May 1, requires a different procedure for ordering property appraisals on behalf of mortgage applicants, in an attempt to avoid fraudulent values.
While I could write a book about the issues involved with HVCC, the highlights that affect BUYERS are as follows:
1. More costly to borrowers in terms of both time and money. Appraisals now take longer since there are more people involved, including an appraisal management company. This can mean purchase contract closing date extensions, interest rate lock extensions and changing moving dates and reservations, etc, etc..
2. Another way the HVCC increases costs for borrowers is the increased likelihood that the lender will require additional reviews of the appraisal once it has been received, again at the expense of the borrower, not the lender.
3. Some appraisers are timid, or maybe just are not familiar with the geographical area and local market trends. If mistakes are made on the appraisal, this may force the borrower to go to another lender and start over. It is VERY difficult to make corrections, no matter how logical and simple it may seem, once an appraisal report has been received by the lender.
Thomas Pierce, of www.examiner.com, sums it up best in his July 29 article titled "New appraisal regulations harm consumers", when he stated,
"This is still yet another example of a political figure with just enough knowledge of the mortgage industry to be dangerous unleashing a series of unintended consequences which ultimately harm the consumer".
www.examiner.com/x-18018-Boston-Mortgage-Industry-Examiner
Several trade groups, such as NAR (National Association of Realtors, www.nar.org ) and NAMB (National Association of Mortgage Brokers www.namb.org ) are currently objecting to HVCC and trying to open a review and dialog about how this practice is affecting the entire housing industry. Until the problems associated with HVCC are addressed and resolved, expect continued red tape when trying to get your next mortgage.
So, how does this pertain to buying distressed property? The HVCC applies to all mortgage transactions completed by lenders who sell or service loans for both FNMA and FHLMC (Federal Home Loan Mortgage Corporation), which is the overwhelming majority with the closing of hundreds of other mortggae loan channels.
However, in addition to this hurdle, some lenders simply will not finance a foreclosure property, or a short sale property. And they are within their rights to set this policy, as unfair as it seems to a well-qualified buyer looking for mortgage money.
Basically, it comes down to the #1 rule in mortgage lending: The Golden Rule, meaning whoever has the gold makes the rules!
Have a great week!
www.mypinellasparadise.com
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