Realtor Coaching & Training: Real Estate Coaching & Market News
This is a new video from CNBC….
HREU students will watch this video and think to themselves….”Tim and Julie told me about all of this new HAFA info LAST November”
Yep, we did.
And many of your took action late last year and are now ready for all the massive changes with short sales starting April 5th!
Bottom line, 2010 IS the Year of the Short Sale…here are a few of the highlights of the new HAFA Short Sale Plan:
* Standard Short Sale documents. All the forms will be the same regardless of lenders.
* $1500 to borrowers to move. Homeowners will literally earn $1500 for doing a short sale!
* $1000 to the banks to do Short Sales. Lenders will receive $1000 for doing a short sale.
* 6% commissions. No more worrying about reduced commissions.
* Lenders will required to respond to all short sale offers within 10 days!
* fast track short sale closings…we expect to see short sales close faster than even REOs!
Agents, please be clear on this. Your market will want you to know how to do short sales using these new Treasury Department guidelines. Learn now, earn now. Watch the FREE HREU CDPD Agent Short Sale Secrets video now…and download the FREE Agent Short Sale Secrets book.
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Harris Real Estate University has been advocating the streamlined…fast track short sales for years.
The HREU CDPD Short Sale Secrets coaching program is the nations largest short sale training education resource in the nation.
Why should you care?
Simple, because we have the utmost confidence that HAFA (or whatever it evolves into) will be the solution for this seemingly never ending housing crisis. Agents, you simply must learn the new 2010 Short Sale Rules. Everything you think you know about short sales will change April 5th. Are you ready?
Interesting video from CNBC’s Diana Olick.
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The US housing market will face another retreat while mortgage-backed securities and Treasurys are likely to go through a “material” correction, Meredith Whitney, CEO of Meredith Whitney Advisory Group, told CNBC Tuesday.
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Are you an agent in California?
Have you been avoiding learning how to do short sales and become a REO Listing Agent? WHY? Are you still believing that you can somehow survive in real estate without having these skills?
A simple suggestion for you…don’t wait another moment. Its not too late for you if you take action NOW to learn what this market..what we call, ‘The New Normal’ demands…
Great article from our friends at DNSNews:
Foreclosed homes taken back by lenders and distressed short sales accounted for nearly half of all residential home sales in California in 2009, according to a market report released this week by the California Association of Realtors (C.A.R.). In 2008, such sales made up 38 percent of annual transactions.
WOW! What else can you say? Agents, the question that I have for you is…how many of those short sales did you list and sell? How many home homeowners could you have helped had you known how to easily list and sell short sales? Watch the FREE HREU CDPD Short Sale Secrets video NOW. Learn the new 2010 ways to easily list and sell short sales.
As one of the hardest-hit states by the housing downturn, the Golden State is littered with bank-owned properties and homes facing foreclosure, but the lower prices and increasing buyer appetite for these deals are helping to reduce some of California’s distressed inventory.
The median price of distressed properties declined nearly one quarter to $250,000 in 2009, compared with $330,000 in 2008, C.A.R. reported. Meanwhile, the median price of non-distressed properties decreased only 10.4 percent to $485,000 compared with $541,000 in 2008.
Although one-third of sellers sold their homes for a loss last year – the highest level on record since C.A.R. started tracking net cash losses in 1989 – the lower home prices lured investors. According to the state Realtors association, more than 70 percent of properties purchased by investors were either short sales or REO/foreclosures. The typical investment property had a median price of $232,750.
Lower home prices and a large supply of distressed properties, coupled with federal tax breaks, also encouraged first-time buyers to take the plunge into
homeownership. The percent of first-time buyers increased dramatically to 47 percent in 2009, up from 35.9 percent in 2008, according to the report.
“It is clear that the federal tax credit for homebuyers worked well in 2009 and is continuing to drive home sales,” said C.A.R. President Steve Goddard. “The homebuyers’ tax credit is arguably the most successful strategy employed by the government’s efforts to stimulate the economy.”
…really? More so than the Fed buying MBS to artificially lower the interest rates….?
According to a survey conducted by C.A.R. on the effectiveness of the federal tax credit, nearly 40 percent of homebuyers in the state said they would not have purchased a home if the tax credit was not offered.
C.A.R. also noted that the large number of distressed properties led to more than half of all first-time buyers purchasing an REO/foreclosure or short sale property.
According to C.A.R.’s analysis, California’s median home price hit bottom in February 2009 at $245,170. Since then, the median home price has increased steadily in month-to-month comparisons, but remained below 2008 levels throughout 2009. The annual median price is projected to increase to $280,000 in 2010 from $271,000 in 2009, the association said.
Homes priced $500,000 or less dominated the sales mix throughout 2008 and 2009, but C.A.R. says sales of high-end homes started picking up in late 2009, with the number of closings for homes priced $500,000 or higher rising 3 percent, and sales of homes priced $1 million or more experiencing their first year-to-year increase since July 2007.
A separate study by a local newspaper shows that a growing number of Californians are turning to the courts to fight the foreclosure process and prevent their homes from becoming REOs. According to numbers complied by the San Jose Mercury News, the number of foreclosure lawsuits filed in federal court in California has ballooned from just 29 cases statewide in 2005 to nearly 1,400 in 2009
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What is the #1 Question Julie and I receive from current and future Harris Real Estate University students alike?
“Coach Tim and Julie…when will the housing market be finally done depreciating…when can we expect the markets to return to normal?”
We always answer the same way:
1) Know Thy Market: Even in the worst hit housing markets there are pockets of housing that are doing great. From a historical perspective, even during the Great Depression there were areas of the US that seemed to be almost immune. Get into your MLS and learn the housing market. Know what is selling and what isn’t.
2) Do No Harm: “Its a great time to buy”….isn’t that what we agents are told to say? Well, is it true? Nope and…depends. Know your client. If they want to keep the home for 10+ years then…yes…in certain markets and price ranges this is indeed a great time to buy. FHA fiance-able price ranges that are in sync with rental rates are probably safe. For example, if you can rent a home for a similar price as it would take to buy the home using FHA financing…them, jump in.
3) Rates Are Going Up…and Loans Will Be Harder To Secure: If you have been reading this blog for any amount of time you know that the fed has backed off buying mortgage backed securities. Mortgage interest rates no longer have the artificial support of the government. That will almost certainly mean…higher rates. If someone is trying to time the market you need to make them fully aware of the ramifications of rising interest rates. Sure, a homes value may fall another x% but, what difference will it make if they can’t qualify for the loan?
Here is an article from Washington Post.
The housing market is facing swelling ranks of homeowners who are seriously delinquent but have yet to lose their homes, and this is threatening a new wave of foreclosures that could hit just as the real estate market has begun to stabilize.
About 5 million to 7 million properties are potentially eligible for foreclosure but have not yet been repossessed and put up for sale. Some economists project it could take nearly three years before all these homes have been put on the market and purchased by new owners. And the number of pending foreclosures could grow much bigger over the coming year as more distressed borrowers become delinquent and then, if they can’t obtain mortgage relief, wade through the foreclosure process, which often takes more than a year to complete.
Translation: Agents, we are in THIS market..for a long time. What can you do now? Learn how to make money from listing and selling Short Sales. As we have been sharing with you since 2007…Short Sales are the best solution to avoid foreclosures. Starting NEXT MONTH the new treasury departments Short Sale Guidelines kick in. Learn the new ways to easily list and sell short sales. Watch the Free HREU CDPD Short Sale Secrets video and download the FREE Short Sale Book NOW.
As these foreclosed properties add to the supply of homes for sale, they could undercut housing prices, which have increased modestly through December, according to the most recent figures in the S&P/Case-Shiller home prices index. That rise partly reflected a slowdown in the flow of foreclosed homes onto the market.
The rate at which J.P. Morgan Chase seized properties, for example, peaked in the middle of 2008 and fell steadily last year, according to a February investor report. But the bank expects repossessions to increase this year, nearly doubling to 45,000 by the fourth quarter.
“Some of the positive housing data may not be signaling a true turning point, as many servicers are holding back on foreclosures and the related houses are not yet being offered for sale,” said Diane Westerback, a managing director at Standard & Poor’s. Westerback said it could take 33 months to clear the backlog.
Data released Thursday by RealtyTrac illustrate the dynamic. While banks repossessed fewer homes in February than a month earlier, borrowers continued to fall behind on their payments, adding to the inventory of properties headed toward foreclosure that have yet to be put on the market, said Daren Blomquist, RealtyTrac’s spokesman.
“Just looking at the numbers, we would expect there to be a bigger percentage of properties” repossessed by banks by now, he said.
This “shadow market” reflects the increasing lag between defaults and foreclosures. Many lenders are struggling to keep up with the overwhelming number of borrowers who can’t make their payments, and they’re reluctant to rush repossessed homes onto the market when prices are depressed.
Note: the total number of so-called bank shadow inventory homes? Low end, 8,000,000…..high end…15,000,000. Bottom line: millions of homes will come on the market over the next 3-5 years as REOs. Is it too late for YOU to become a REO Listing Agent? No. Watch the FREE Agent REO Secrets video and download the FREE How-To List REOs book now.
Delinquent borrowers
Today’s delinquent borrowers, for the most part, differ in a key regard from those who were caught up in the surge of defaults in 2008. That earlier wave, which precipitated the financial crisis, consisted largely of subprime borrowers who defaulted when their risky loans became unaffordable.
The borrowers in trouble now are, for the most part, people who have better credit and safer loans and have become delinquent because they’ve lost their jobs or are dealing with other economic setbacks, economists said. More than 75 percent of the borrowers who are now seriously delinquent — meaning they have missed at least three monthly payments — have traditional prime loans, according to First American CoreLogic. Most of these borrowers have not made a mortgage payment in six months.
Strategic Foreclosures are the reason….literally millions of homeowners choosing to do a short sale (the smart ones) or let the home go back to their lender and suffer the negative ramifications of a foreclosure. A recent study demonstrated that homeowners with the BEST credit will walk away (short sale or a foreclosure) when their home is 1) $70,000 upside down or..25%.
These borrowers are among the most difficult to help. Homeowners with economic troubles such as extended unemployment often cannot make even reduced mortgage payments. And the longer borrowers stay delinquent, the more difficult it is to fashion a mortgage relief plan for them.
Some lenders are giving distressed borrowers more time to see whether they can modify the terms of their loans.
It can take a borrower six to seven months to find out whether he or she qualifies for a permanent loan modification under the federal foreclosure relief program, Making Home Affordable, according to Barclays Capital.
In Maryland, for example, lawmakers extended the foreclosure process from 15 days to 135 days in 2008 and are considering emergency legislation to force lenders into mediation with a borrower before foreclosing on a property. But other states and jurisdictions have even more drastic measures to slow down the foreclosure process. “There were cases where sheriffs were refusing to file foreclosure notices,” said Jay Brinkmann, chief economist for the Mortgage Bankers Association.
After a temporary foreclosure moratorium in 2008, the backlog of homeowners facing foreclosure in Maryland has surged. The number of Maryland homeowners who are seriously delinquent or in the midst of the foreclosure process nearly doubled during the fourth quarter of 2009 compared with the same period a year earlier, according to data from the Mortgage Bankers Association.
“Lenders are deluged by late-stage delinquencies. The pent-up foreclosure inventory is there,” said Massoud Ahmadi, director of research for the Maryland Department of Housing and Community Development.
Housing prices
The uptick in foreclosure sales is helping depress Maryland home prices, he said. “We have seen that home sales are on an upswing, but prices are on a downswing. That is the impact of the shadow inventory. It is keeping prices down,” Ahmadi said.
In addition to those already in default are 11 million more U.S. borrowers who owe more on their mortgage than their home is worth — known as being underwater — and are in danger of becoming delinquent, said Sam Khater, chief economist for First American CoreLogic.
Agents…did you catch that…11 MILLION!
Over the past year, the number of foreclosed homes going up for sale has declined. Distressed properties made up just 38 percent of purchases in January, compared with the 49 percent peak in March 2009, according to the National Association of Realtors. That helped the inventory of homes on the market fall to a 7.8-month supply, close to the figure during normal times and down from more than 11 months in July 2008. But as prices continue to stabilize, lenders are likely to take advantage of the situation by putting more of these distressed properties on the market, economists said.
“Banks have remained in foreclosure paralysis, allowing that backlog to get larger and larger. You can’t do that indefinitely,” said Sandeep Bordia, head of U.S. residential credit strategy at Barclays Capital.
That impact could be muted if enough buyers emerge to snap up properties or efforts to enroll borrowers in mortgage relief programs improve. Some lenders are looking for ways to ease delinquent borrowers out of their homes without a foreclosure. For example, lenders are allowing more short sales, in which the home is sold for less than the outstanding loan balance. Citigroup is testing a program that allows delinquent borrowers to stay in their home for six months free if they leave the property in good condition, making it easier to sell afterward.
“We are anticipating a foreclosure glut that is likely to come up in next 16 to 18 months. We are trying to stay ahead of this,” said Sanjiv Das, chief executive of CitiMortgage. These types of programs are “protecting house prices and consumer sentiment from going down further,” he said.
What does this mean to you…HREU Student (or future student)? Please understand that the housing markets will not significantly improve for years. Short Sales and REOs are the market and will only be more so over the next 24-36 months.
Regional impact
The impact of the coming foreclosure wave will vary by region. The Washington area has a “shadow inventory” of about 67,000 properties that could go into foreclosure this year, an 11-month supply at the current sales rates, according to research by John Burns Real Estate Consulting in Irvine, Calif. That is slightly higher than the national average but far less than the hardest-hit communities, such as Orlando and Miami, where there is two-year backlog.
And the backlog will hang over some communities for years. By the end of 2012, 39 percent to 50 percent of home purchases in Phoenix will still be foreclosed properties, J.P. Morgan Chase has estimated. In Los Angeles, they’ll account for 28 percent of home sales.
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Join us for this week’s FREE live Harris Real Estate University Superstar Interview.
This weeks featured HREU Superstar’s are:
Lance and Karen Kenmore.
The Kenmore’s are long time HREU students having been personally coached by Tim and Julie Harris for years. Listen in as we ask the Kenmore’s how they have gone from selling only a handful of homes per year just a few years ago…..to today, where they will sell well over 100 homes in 2010. The Kenmores fully embrace the HREU rule of having multiple lead generation spokes. The Kenmore’s have a weekly radio show, are Dave Ramsey preferred agents, have a fantastic system for keeping in contact with their centers of influence and past clients.
Join us for this FREE HREU Event. Here is the info for your schedule:
EVENT: Super Star Interview
DATE & TIME: Friday, March 12th at 9:00am Pacific
FORMAT: Simulcast! (Attend via Phone or Webcast — it’s your choice)
TO ATTEND THIS EVENT, CLICK THIS LINK NOW…
http://AttendThisEvent.com/?eventid=11669457
A little info on Lance and Karen from their website:
The Kenmore Team is a full service real estate team assisting buyers and sellers in residential resale, relocation, investment properties, short sales, foreclosures and luxury homes sales in Tri-Cities, Washington (Richland, Pasco, Kennewick) and surrounding areas.
As life long residents of the Tri-Cities and active members of our community our first hand experience and knowledge of the area provide you a major advantage when making important real estate decisions. Working as part of a powerful team we provide our clients with exceptional customer service, technology, and most importantly results. We back this up with a guarantee that most agents wouldn’t even consider.
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Rick Sharga, RealtyTrac
Breaking News: New foreclosure filings drop…but, is this reason to celebrate…or is something else going on?
U.S. foreclosure filings rose at the slowest pace in four years in February as the government sought to reduce record bank seizures, RealtyTrac Inc. said.
A total of 308,524 properties received a notice of default, auction or seizure last month, or one in 418 households, the Irvine, California-based seller of default data said today in a statement. Filings rose 6 percent from a year earlier, the smallest increase since RealtyTrac began tracking annual changes in January 2006. They declined 2 percent from January.
The Obama administration’s main effort to keep people in their homes resulted in more than 830,000 trial loan modifications for delinquent borrowers through January, according to the Treasury Department. Still, filings were up for the 50th straight month in February on an annual basis and topped 300,000 for the 12th consecutive month, RealtyTrac said.
“This leveling of the foreclosure trend is not necessarily evidence that fewer homeowners are in distress and at risk for foreclosure, but rather that foreclosure prevention programs, legislation and other processing delays are in effect capping monthly foreclosure activity,” RealtyTrac Chief Executive Officer James J. Saccacio said in a statement.
About 116,000 mortgages have been permanently modified under the government’s program, compared with as many as 4 million targeted by December 2012. New data will be released March 15, Meg Reilly, a Treasury spokeswoman, said in an e-mail.
Winter storms may also have delayed the processing of foreclosure notices in the U.S. northeast and mid-Atlantic, RealtyTrac said.
Interesting point…many state offices were simply closed due to the weather. That will result in what appears to be fewer filings but, the reality is that we will see another surge in next months report. So, if the Obama administration wants to truly slow down the rate of foreclosure filings maybe they should simply mandate more ’snow days’ for the states county court houses! Hey, don’t laugh…that would be a heck of a lot cheaper than HAMP!
Bank Repossessions
Bank seizures are increasing the number of homes for sale. Lenders took back 78,683 properties last month, up 6 percent from February 2009 and down 15 percent from a peak in December, RealtyTrac said. More than 2 million empty homes were on the market in the fourth quarter, according to the Census Bureau.
“Government programs are helping to keep more supply from coming out,” Brian Bethune, chief financial economist at IHS Global Insight in Lexington, Massachusetts, said in an interview. “We’ve got a disjointed market where most of the housing supply is coming from foreclosures rather than building new homes.”
‘High’ Foreclosure Rate
Bethune predicted a “high” rate of foreclosures for at least the next 12 months. RealtyTrac expects record bank seizures this year, said Rick Sharga, executive vice president for marketing.
So, as an agent what should you do? Simple. Learn how to become a REO Listing agent…and make money from BPOs. Its NOT too late for you to become a REO listing agent. Banks are looking for agents to do their BPOs and list REOs NOW. Watch the FREE Agent REO Secrets Video and then Grab your FREE Agent REO Secrets book.
The cost of borrowing for home purchases will probably rise as the Federal Reserve winds down a program to purchase as much as $1.25 trillion of mortgage bonds, according to George Mokrzan, senior economist at Huntington National Bank in Columbus, Ohio. Mortgage rates fell to 4.95 percent in the week ended today from 4.97 percent, Freddie Mac said in a statement.
Default notices totaled 106,208 in February, down 3 percent from a year earlier and up 3 percent from January, RealtyTrac said. Defaults peaked at more than 142,000 in April.
Scheduled auctions totaled 123,633 last month, up 16 percent from February 2009 and down 1 percent from January. The peak was more than 144,000 in August.
Nevada, California
Nevada had the highest foreclosure rate for the 38th straight month in February, with one in 102 households receiving a filing. Arizona and Florida tied for second at one in 163 households.
California ranked fourth at one in 195 households, followed by Michigan at one in 226. Utah, Idaho, Illinois, Georgia and Maryland rounded out the 10 highest foreclosure rates.
The most filings were in California, with 68,562, down 15 percent from a year earlier. Florida was second with 54,032, up 16 percent, and Michigan was third at 20,028, a 59 percent rise.
Illinois had the fourth-highest total filings with 17,312, Arizona had 16,718 and Texas had 12,638. The six states accounted for 61 percent of the U.S. total, RealtyTrac said.
Georgia, Ohio, Nevada and Maryland rounded out the top 10.
Filings rose 14 percent from a year earlier to 3,750 in New Jersey. They climbed 3.3 percent to 2,294 in Connecticut, and dropped 20 percent to 3,237 in New York.
Las Vegas had the highest foreclosure rate for cities with a population of more than 200,000. One in 90 households there got a filing. Cape Coral-Fort Myers, Florida, was second at one in 92.
Six metro areas in California or Arizona had decreases in filings from January, with Phoenix showing the biggest drop at almost 18 percent.
Port St. Lucie, Florida, showed a 66 percent increase, said RealtyTrac, which sells default data collected from more than 2,200 counties representing 90 percent of the U.S. population.
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