Quite frankly, I thought the 3rd time would be the charm, but no.......... Once again Congress failed to extend the National Flood Insurance Program and again this has caused delays in closings. The National Flood Insurance Program provides federally backed and affordable flood insurance coverage for millions of homes and businesses nationwide. Here on the coast lender's require flood insurance as part of the loan, much like they would traditional homeowners insurance. By some estimates, this failure to extend the program has caused the delay of approximately 1400 properties daily across the country.
Until the program is reauthorized, buyers cannot obtain the insurance, however in some cases they are able to assume the seller's policy. So why am I writing about something negative in the real estate market? Quite frankly because we need help. It is certainly not news that the real estate market has suffered dramatically over the last several years and here in the second home market it is no different. Many people have asked me why we are suffering because the second home market is just another luxury of the rich. On more than one occasion I have heard something like "rich people will buy in any market". That's just not true.
Beyond the proclivities of the people with significant discretionary income, let's think about what these second and retirement homes mean in the broad picture. In my opinion, they are the basis for a big part of our economy and a source of livelihood for our middle class. Think of the carpenter doing the framing on the house, think of the irrigation company installing the system, think of the washers, dryers, refrigerators, tv's etc. being purchased and installed, think of the restaurants that are being patronized, think of the home improvement stores selling all manner of merchandise to a new home owner and the list goes on and on and that is precisely why we (those of us making our living in the housing market and the sellers trying to sell their homes)need this program to be reinstated.
On a daily basis, I read about how much Washington is doing to stimulate the housing market and for that I say thanks. I am not asking for a new stimulus, I am just asking to resuscitate a necessary program before it is too late, I'm just asking to not create problems. The housing market has taken many blows to the head and we keep getting up -- we have too,our nation's economy depends on it. If you agree with me that Congress shouldn't break for independence day without passing this, please contact either Jim DeMint or Lindsey Graham. If you go to their websites, you will be directed to fill out a form which is fine, however a think a better idea is to email their schedulers at alice_james@lgraham.senate.gov or julie_blackorby@demint.senate.gov. Thanks in advance.
Showing posts with label housing market. Show all posts
Showing posts with label housing market. Show all posts
Friday, June 25, 2010
Wednesday, June 10, 2009
Another Lender Story
Here I go again. In yet another transaction that our company is involved in the Lender is dragging his feet. Our company brought an offer on a bank owned property that is listed with another company. There were competing offers and our offer eventually won the sale. Unfortunately the lender that owns the property did not sign off on the offer, thereby converting it to a bona fide sale. So what happens next? Another agent with another buyer comes along and submits an offer. Once again we have to compete, once again we win. Once again the lender is not signing off. They are telling their agent, "Oh, it's okay, everything is fine". Their agent is telling us that he is telling all subsequent offerees that the property is in contract, which technically it is not. Meanwhile no one can sign off on this agreement. Meanwhile this bank owned property is still on the market. Meanwhile our buyer is still not in firm contract or any contract for that matter. Is this the sort of behavior that got them in trouble in the first place? YIKES!!!!!!!
Tuesday, June 9, 2009
Do the Lenders Really Want to Get the Short Sales & Foreclosures Off Their Books
Yes, there are glimmers on the horizon of an improving economy and housing market. Yes, I have written countless times regarding what a good time it is to buy. Yes, I have even reprinted other people's missives on the subject, so you know I believe it is a good time to buy. And finally yes, prices are still attractive, interest rates are still good and the inventory of homes to buy is still larger than normal.
So what's my beef?
Short sales and foreclosures, that's my beef. Specifically how uncooperative the lenders in these positions are. As I write, our company has a listing that is in short sale status (the lender is willing to take less than is owed on the property) with multiple offers on it. As the Broker in Charge, I had to step in and take over the negotiations because the listing agent also brought one of the offers. So my first course of action is to submit all three offers to the lender. Done. Knowing full well that these things take longer than normal I waited a few days to contact the lender. When I contacted them to check the status and see how they were going to proceed --
a. choose one offer and reject the others,
b. negotiate all the offers or
c. reject all the offers
I was told that I should have selected the best one and rejected the others. To which I explained that this wasn't possible, that I had to present all offers and although technically they aren't the seller (yet) the transaction is subject to third party approval. The person on the other end sighed heavily and told me that my offers although they had been submitted five days earlier were waiting for document review from the underwriter, not document review of offers but of the home owner's file. In other words they wouldn't even look at any of them until they amassed reams of paper from the seller.
Five days after that, I have checked back twice and the only thing I can tell you is that the seller's file is complete and the offers have gone to the underwriter. They can't / won't tell me which offer has been chosen, they don't know who the underwriter will choose. They can't / won't let me talk to the underwriter. They tell me that a decision should be made in about 30 days. I tell them that the home is due to be foreclosed on prior to that. They say call a week before to get them to avert the foreclosure.
Next, I ask them to please take pity on me and my buyers. I try to explain that without even knowing if their offers have been selected or not that they will grow nervous and weary and that we stand the chance of losing any or all of the buyers and clearly that isn't good for either of us. I told them that most buyers won't wait 30 days to know if they are even going to be negotiated with, that they will start looking around at other stuff. The response, "well, if one or all of them walk just notify us".
I ask them to take pity on my seller. I explain the state of anxiety a seller must be in when they are on the brink of something as serious as short sale and if that doesn't work, foreclosure. I tell them I will do whatever I can to help expeditite the process. I am essentially told, "sorry about your luck, we will be done, when we are done".
I am STUNNED....... Every day for months and months the whole country has been reading about the economic and housing crisis. We have read about how no one is doing anything, that consumer confidence is at a historic low, that lenders are awash in foreclosures and short sales, that families are losing their homes, people are losing their jobs etc. The news has been dismal at best and here in our situation, we have ready willing and able buyers and we can't even get a response.
This I know for sure, it is paramount that we get the inventory reduced. Prices have no hope of returning to normal until there are fewer homes. That is a simple law of supply and demand. We have no hope of a serious reduction in inventory with such a lack of cooperation from the lenders. This particular lender's representatives were down right disdainful in speaking with me. If I am frustrated, I can't imagine how the buyers must feel.
Is there an answer? Yes, get the lenders to cooperate with ready, willing and able buyers. How do we do that? I'm not sure, it will take someone much smarter than me to figure that one out.
So what's my beef?
Short sales and foreclosures, that's my beef. Specifically how uncooperative the lenders in these positions are. As I write, our company has a listing that is in short sale status (the lender is willing to take less than is owed on the property) with multiple offers on it. As the Broker in Charge, I had to step in and take over the negotiations because the listing agent also brought one of the offers. So my first course of action is to submit all three offers to the lender. Done. Knowing full well that these things take longer than normal I waited a few days to contact the lender. When I contacted them to check the status and see how they were going to proceed --
a. choose one offer and reject the others,
b. negotiate all the offers or
c. reject all the offers
I was told that I should have selected the best one and rejected the others. To which I explained that this wasn't possible, that I had to present all offers and although technically they aren't the seller (yet) the transaction is subject to third party approval. The person on the other end sighed heavily and told me that my offers although they had been submitted five days earlier were waiting for document review from the underwriter, not document review of offers but of the home owner's file. In other words they wouldn't even look at any of them until they amassed reams of paper from the seller.
Five days after that, I have checked back twice and the only thing I can tell you is that the seller's file is complete and the offers have gone to the underwriter. They can't / won't tell me which offer has been chosen, they don't know who the underwriter will choose. They can't / won't let me talk to the underwriter. They tell me that a decision should be made in about 30 days. I tell them that the home is due to be foreclosed on prior to that. They say call a week before to get them to avert the foreclosure.
Next, I ask them to please take pity on me and my buyers. I try to explain that without even knowing if their offers have been selected or not that they will grow nervous and weary and that we stand the chance of losing any or all of the buyers and clearly that isn't good for either of us. I told them that most buyers won't wait 30 days to know if they are even going to be negotiated with, that they will start looking around at other stuff. The response, "well, if one or all of them walk just notify us".
I ask them to take pity on my seller. I explain the state of anxiety a seller must be in when they are on the brink of something as serious as short sale and if that doesn't work, foreclosure. I tell them I will do whatever I can to help expeditite the process. I am essentially told, "sorry about your luck, we will be done, when we are done".
I am STUNNED....... Every day for months and months the whole country has been reading about the economic and housing crisis. We have read about how no one is doing anything, that consumer confidence is at a historic low, that lenders are awash in foreclosures and short sales, that families are losing their homes, people are losing their jobs etc. The news has been dismal at best and here in our situation, we have ready willing and able buyers and we can't even get a response.
This I know for sure, it is paramount that we get the inventory reduced. Prices have no hope of returning to normal until there are fewer homes. That is a simple law of supply and demand. We have no hope of a serious reduction in inventory with such a lack of cooperation from the lenders. This particular lender's representatives were down right disdainful in speaking with me. If I am frustrated, I can't imagine how the buyers must feel.
Is there an answer? Yes, get the lenders to cooperate with ready, willing and able buyers. How do we do that? I'm not sure, it will take someone much smarter than me to figure that one out.
Tuesday, August 26, 2008
Some Good News For Everyone
New-Home Sales in U.S. Increase From 17-Year Low (Update1)
By Shobhana Chandra
Aug. 26 (Bloomberg) -- New-home sales in the U.S. improved in July from a 17-year low and construction cutbacks by builders reduced the glut of properties on the market by the most in almost five decades.
Sales increased 2.4 percent to a 515,000 annual pace that was lower than anticipated after a revised 503,000 rate in June, the Commerce Department said today in Washington. The number of unsold homes on the market fell 5.2 percent, the most since November 1963, to a 416,000 pace.
Lower prices have made homes more affordable for Americans still able to obtain a mortgage, stemming the slide in demand and making it more likely the property glut will clear. A more stable housing market would eliminate one of the biggest risks to the economy even as the credit crisis and job losses threaten growth.
``We're hopefully getting in the vicinity of a bottom,'' David Resler, chief U.S. economist at Nomura Securities International Inc. in New York, said before the report. Still, ``we're a long way from a recovery. We'll see activity at low levels for a while.''
Economists forecast new-home sales would drop to a 525,000 annual pace from an originally reported 530,000 rate the prior month, according to the median estimate in a Bloomberg survey of 76 economists. Forecasts ranged from 493,000 to 570,000.
The median price of a new home decreased 6.3 percent to $230,700, from $246,200 a year earlier.
Cheaper Gasoline
Consumer confidence in August increased more than forecast in August as cheaper gasoline improved Americans' moods, a private report showed. The Conference Board's confidence index rose to 56.9 from 51.9 in July.
Another report today showed home prices fell at a slower pace in the second quarter, signaling the slump may be starting to stabilize. Home values declined 2.3 percent from the previous three months, compared with a 6.8 percent drop in the first quarter, according to the S&P/Case-Shiller index.
Sales of new homes were down 35 percent from July 2007, the Commerce report showed.
The supply of homes at the current sales rate fell to 10.1 months' worth from 10.7 months in June. Still, real-estate industry groups have said a five to six months' supply signal a balanced market.
While accounting for only about 15 percent of the housing market, new-home purchases are considered a timelier indicator because they are based on contract signings. Sales of previously owned homes, which make up the remainder, are compiled from closings and reflect contracts signed weeks or months earlier.
Weakness Masked
Resales increased 3.1 percent in July, the National Association of Realtors said yesterday. The gain masked further weakness as inventories surged to a record high level of 4.67 million unsold houses and condos.
Inventories of new properties are likely to keep shrinking as builders pull back. Ground was broken on the fewest new houses in 17 years in July, and permits, a sign of future construction, also fell, Commerce Department figures showed.
Government officials remain pessimistic.
``We have a ways to go before we start seeing a turnaround,'' Housing and Urban Development Secretary Steve Preston said yesterday in an interview. ``We'll be well into 2009 before we see some real energy in this market.''
New home sales increased in two of four regions from the prior month, led by a 39 percent jump in the Northeast. Purchases declined 8.2 percent in the Midwest and 2.5 percent in the South, today's report showed.
Company results reflect the distress. Home Depot Inc. and Lowe's Cos., the world's two largest home-improvement retailers, posted declines in second quarter profit.
``We continue to see pressure on our market and the consumer,'' Home Depot Chief Executive Officer Frank Blake said in a statement last week.
To contact the reporter on this story: Shobhana Chandra in Washington schandra1@bloomberg.net
By Shobhana Chandra
Aug. 26 (Bloomberg) -- New-home sales in the U.S. improved in July from a 17-year low and construction cutbacks by builders reduced the glut of properties on the market by the most in almost five decades.
Sales increased 2.4 percent to a 515,000 annual pace that was lower than anticipated after a revised 503,000 rate in June, the Commerce Department said today in Washington. The number of unsold homes on the market fell 5.2 percent, the most since November 1963, to a 416,000 pace.
Lower prices have made homes more affordable for Americans still able to obtain a mortgage, stemming the slide in demand and making it more likely the property glut will clear. A more stable housing market would eliminate one of the biggest risks to the economy even as the credit crisis and job losses threaten growth.
``We're hopefully getting in the vicinity of a bottom,'' David Resler, chief U.S. economist at Nomura Securities International Inc. in New York, said before the report. Still, ``we're a long way from a recovery. We'll see activity at low levels for a while.''
Economists forecast new-home sales would drop to a 525,000 annual pace from an originally reported 530,000 rate the prior month, according to the median estimate in a Bloomberg survey of 76 economists. Forecasts ranged from 493,000 to 570,000.
The median price of a new home decreased 6.3 percent to $230,700, from $246,200 a year earlier.
Cheaper Gasoline
Consumer confidence in August increased more than forecast in August as cheaper gasoline improved Americans' moods, a private report showed. The Conference Board's confidence index rose to 56.9 from 51.9 in July.
Another report today showed home prices fell at a slower pace in the second quarter, signaling the slump may be starting to stabilize. Home values declined 2.3 percent from the previous three months, compared with a 6.8 percent drop in the first quarter, according to the S&P/Case-Shiller index.
Sales of new homes were down 35 percent from July 2007, the Commerce report showed.
The supply of homes at the current sales rate fell to 10.1 months' worth from 10.7 months in June. Still, real-estate industry groups have said a five to six months' supply signal a balanced market.
While accounting for only about 15 percent of the housing market, new-home purchases are considered a timelier indicator because they are based on contract signings. Sales of previously owned homes, which make up the remainder, are compiled from closings and reflect contracts signed weeks or months earlier.
Weakness Masked
Resales increased 3.1 percent in July, the National Association of Realtors said yesterday. The gain masked further weakness as inventories surged to a record high level of 4.67 million unsold houses and condos.
Inventories of new properties are likely to keep shrinking as builders pull back. Ground was broken on the fewest new houses in 17 years in July, and permits, a sign of future construction, also fell, Commerce Department figures showed.
Government officials remain pessimistic.
``We have a ways to go before we start seeing a turnaround,'' Housing and Urban Development Secretary Steve Preston said yesterday in an interview. ``We'll be well into 2009 before we see some real energy in this market.''
New home sales increased in two of four regions from the prior month, led by a 39 percent jump in the Northeast. Purchases declined 8.2 percent in the Midwest and 2.5 percent in the South, today's report showed.
Company results reflect the distress. Home Depot Inc. and Lowe's Cos., the world's two largest home-improvement retailers, posted declines in second quarter profit.
``We continue to see pressure on our market and the consumer,'' Home Depot Chief Executive Officer Frank Blake said in a statement last week.
To contact the reporter on this story: Shobhana Chandra in Washington schandra1@bloomberg.net
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