Real Estate Information Archive

Jeff and I have been communicating for the past 4 years and the time was finally right for him to buy.  We worked together seamlessly as team – with me providing Jeff data and comparables and Jeff and I working together on negotiations – it took a few offers but we finally honed in on the right property.  After some friendly but tough negotiating, we put together a great deal for Jeff on a fully furnished condo in the Moonlight Basin area of Big Sky.   I think Jeff will do very well with this investment – between personal enjoyment, rental income during both ski and summer season and hopefully – appreciation as the market starts to bottom and hopefully increase.  Big Sky, Montana has some real values out there for the discriminating buyer!

REO Sales: When Will They Peak

HousingWire estimates that REO’s will not max out until 2013. Foreclosure sales are expected to reach 1.48 million in 2013 seconds Bank of America Merrill Lynch.

HOWEVER, with the continued surge of REOs, "we do not expect to see anywhere near the downward pressure on home prices that we had back in 2008, since the expected percent changes in liquidation volumes are so much smaller," the analysts say. The change will come from a shift from private bank portfolios to government backlogs. Overall, Fannie Mae, Freddie Mac, and Department of Housing and Urban Development are expected to liquidate 595,000 properties.

In order to handle the surge, the government is considering proposals of turning some foreclosures into rental and refinancing more underwater borrowers so they’ll be less likely to walk away from their property. Analysts are divided on this solution, but no matter what, creative answers need to be found and acted upon.

For information on bank owned properties in the Bozeman, Belgrade, Big Sky markets, click on www.athomeinbozeman.com 

For Similar Articles:

Avoid REO Surprises 

Buying From Banks

Becoming an REO Specialist!

Source: “REO Sales May Not Peak Until 2013,” HousingWire (Oct. 17, 2011)

Housing Market Fixes: Spending Big Bucks or Saving on the Small Adjustments?

Continuing the handful of minor adjustments in the housing market is projected to hasten the already advancing housing market. GOOD NEWS: A major monetary overhaul is not needed!

"I take a great deal of solace in recent numbers. The stability in non-distressed prices is encouraging and suggests an underlying stability in the overall housing market. If you can implement policies that reduce the share of distressed sales of the total market, housing should see a dramatic recovery quickly." says Moody's Chief Economist Mark Zandi.

Zandi’s three core issues within the housing market today are as follows:

Valuation: Values of houses have been dramatically high comparatively to incomes and rental costs. Housing prices are leveling out at a more parallel rate to income although still high compared to rents.

Overbuilding: Excess inventory on the market will take a few years to even out. The current surplus in supply needs to meet up with the rate of demand.

Foreclosure: ~3.4 million first-mortgage loans are in foreclosure right now. Prices are expected to decline until the amount of foreclosures starts to go down.

Simple solutions such as government sponsored enterprises (Fannie Mae and Freddie Mac) can make it easier to refinance and do principal reductions. The attorneys’ general suit against banks which improperly handled documentation on mortgages must reach an end. Distressed sales will go up and short sales/foreclosures held up by such suits will fall in the long term. The last minor fix is with credit. Credit needs to get back to the pre-boom levels. Getting qualified borrowers back into the market to take advantage of the ‘outstanding quality’ of different loans currently being offered.

"Our problems are not drastic," Zandi said. "We don't need to do one big thing to fix all of this. We've gone a long way to right the wrongs in this industry. There are just a few things we need to do around the edges. If you can implement policies that reduce the share of distressed sales of the total market, housing should see a dramatic recovery quickly." 

http://realtormag.realtor.org/daily-news/2011/10/12/solutions-for-housing-big-fixes-or-small-tweaks

Tim Hart

Rental Market Is The Housing Market's Bright Spot:

When housing prices drop, sellers and buyers look for different options. 1.4 million households have decided to move into rental housing this year—a 4% rise of the number of tenants from last year. Home ownership has dropped 1.5% in that same time.

Most of this rental demand is being generated from young couples and newly built households who are postponing homeownership. But as always, this trend is like a pendulum and as demand for rentals increase, vacancy rates are dropping and rents rising. Look for new multi-dwelling constructions, higher priced monthly dues, and property sales on the rise.

“With rental demand rising and apartment economics improving, the multifamily sector is a positive signal for the U.S. housing industry,” writes Frank Nothaft, Freddie Mac’s Chief Economist, in the October 2011 U.S. Economic and Housing Market Outlook.

Tim Hart

New studies are suggesting that 30% of adults are living with their relatives. “Doubling Up,” this trend of co-habilitation, is at levels that have not been seen since the Great Depression. The recent US Census data shows the greatest rise is found in young adults who are moving back in with parents. About 5.9 million Americans 25-34 live with their parents, a 25% increase compared to the years prior. Men are twice as likely as women to make this untraditional move in life.

In conjunction with this new data, renters and home owners are also delaying new home purchases due to tougher mortgage qualifying standards and concerns regarding the economy and job security. Still, the majority feel home ownership is an important keystone in life and they feel more and more comfortable with the direction the housing market is moving.

http://realtormag.realtor.org/daily-news/2011/10/13/more-adults-move-in-relatives 

Tim Hart

Improved Job Statistics Propel Mortgage Rates Up

1-Year ARMs: hold as an average of 2.9%. A year ago the 1-year ARM averaged at 3.4%

5-Year ARMs: found a mean of 3.06% this week. A year ago, a 5-year ARM was at 3.47%

15-Year FRMs: averaged at 3.37% as compared to last year’s 3.72%

30-Year FRMs: 4.12% is the average this week in contrast to 4.27% last year!

ARMs (adjustable-rate mortgages) and FRMs (fixed-rate mortgages) are important indicators for potential buyers who are on the threshold of buying. 30-year financing options are the most popular according to Freddie Mac.

“An employment report that was better than market expectations helped to lift long-term Treasury bond yields and mortgage rates as well,” Frank Nothaft, Freddie Mac’s chief economist, notes. In September, the economy added 103,000 workers; however, the unemployment rate still remained high at 9.1 percent.

Record lows have been being seen across the board over the last month with future projections of staying well below 5% through 2013.

If now is the time for you to buy, CLICK HERE

http://realtormag.realtor.org/daily-news/2011/10/14/improved-job-report-sends-mortgage-rates-higher 

BIG Improvements Seen in 23 Housing Markets 

1. Alexandria, La.
2. Amarillo, Texas
3. Anchorage, Alaska
4. Bismarck, N.D.
5. Casper, Wyo.
6. Fairbanks, Ark.
7. Fayetteville, N.C.
8. Houma, La.
9. Iowa City, Iowa
10. Jonesboro, Ark.
11. Kankakee, Ill.
12. McAllen, Texas
13. Midland, Texas
14. New Orleans, La.
15. Odessa, Texas
16. Pine Bluff, Ark.
17. Pittsburgh, Pa.
18. Sherman, Texas
19. Sumter, S.C.
20. Waco, Texas
21. Waterloo, Iowa
22. Wichita Falls, Texas
23. Winston-Salem, N.C. 

The above 23 locations have been dubbed as ‘improving’ this October due to NAHB’s index!

Last month, half this number was qualified as improving by the National Association of Home Builders/First American Improving Markets Index. An improving market is qualified as a growth in housing permits, employment, and housing prices in the last six for six consecutive months.

"Both the number and geographic diversity of improving housing markets expanded this month, with Iowa, Illinois, and South Carolina all newly represented by one entry or more on the list," Bob Nielsen, NAHB chairman, said in a statement. "This is further evidence that, despite the tough conditions that persist in many cities, pockets of improvement are emerging in local housing markets across the country."

http://realtormag.realtor.org/daily-news/2011/10/07/23-housing-markets-show-big-improvement

Tim Hart

Parents Assisting Children with Housing!

FHA’s Kiddie Condo Loan Program is a non-occupant co-borrow program allowing parents to assist their children buy a single family home or condo as they go off to college instead of paying for the costs of rent or dorms. The kiddie condo is just a nickname for a whole realm of options available for buyers-not only condos. Both borrowers take the title of the property and sign for the loan together.  

Tight credit standards, rising college tuition costs, high unemployment rates, and the drop in scholarship availability are all solidifying the idea of family unity when it comes to the housing market. Young adults and their parents are picking up on the opportunity presented to them by the real estate market—a joint financing package that benefits both parties. Parents who are weary of stock market investments are securing an investment in real estate. Young adults are able to build their real estate portfolio from a very young age with their parent’s backing.

The benefits of a ‘kiddie condo’ are numerous. First off, intra-family loans offer higher returns, interest rates are lower on the loan, and, as a joint unit, child and parents can compete in the market on a scale neither would be able to do alone.

National Family Mortgage say that they have assisted families finance $12+ million in loans! Become one more success story!

“I could never be in a house without by parent’s help, and they would never have been able to have purchased this investment property without me. I am 1/3 of the owner and am learning what it means to be a first-time home buyer. The Kiddie Condo option is certainly something that every college student ought to consider. The cost of rent is so high. I got to paint, design, landscape, and feel a deep pride in coming back at the end of the day to my HOME.” –Brittney Dahlberg (assisted by Broker Tim Hart and Jenifer Owens @ Bozeman Montana Real Estate.net)

Information From: http://realtormag.realtor.org/daily-news/2011/10/06/more-kids-turn-parents-for-mortgage-help

Life happens. Flood damage, snow damage, ect. If you are part of a Home Owner’s Association, who is it that pays the price of repair?

Determine the cause of the damage or loss do weed out if there were neglectful parties involved (for then it is their maintenance issue). Be sure to document exact damage as soon as possible after the damage is done to give the most accurate estimates for repair requests.  Take pictures.

Review legal documents affiliated with your HOA bylaws. This may offer you easy guidance. Key words to focus on are “unit, common element, limited common element, maintenance responsibilities of owners, maintenance responsibilities of home owners association, insurance responsibilities, and enforcement procedures” (www.realtytimes.com)

Inform you HOA so they know what is going on.

Generally, owners are responsible for things within the boundaries of their unit and HOA takes care of shared or common spaces. But note: maintaining a component does not imply that repair is included if that component fails. In the instance of owner negligence, the owner is always responsible. Your HOA policies should be consistent and very clear. This is for your protection as well as theirs. If you have questions, step up and ask!