What Makes It Difficult To Sell
The Lawrence Journal World reports from Kansas. “In 2008, 1,360 properties were sold in Douglas County, nearly all of them residential, according to Board of Realtors statistics. That was down 21 percent from the 1,677 properties sold in 2007. Jennifer Harrell has been trying to sell her Lawrence townhouse for more than a year. Three years ago, when the housing market was still booming, she obtained a 100 percent loan for her house. She still doesn’t have enough equity in it.”
“‘I would have to sell my house for a lot higher than what it is appraised at to afford a down payment on another house,’ said Harrell. ‘That’s what makes it difficult to sell.’”
“The once-booming home construction industry in Lawrence is entering a third year of decline. Homes built by contractors on speculation that someone will buy them has dwindled, said Mike Nuffer, president of Lawrence Home Builders. ‘It does seem that there are a lot of people who want to do something, but they’re just scared,’ Nuffer said.”
The Sun Times from Illinois. “In Oak Park, the average sale price for single-family homes in 2008 was $484,749 — down $41,000 (-8.5 percent) from 2007, according to an industry report. In River Forest, the average sale price dropped a shade below 2 percent, from $918,405 to $901,275. For condominiums and town houses, prices also took a tumble in 2008. In Oak Park, the average price dropped from $273,834 in 2007 to $241,217 (-13.5 percent). In River Forest, the drop was 25 percent ($243,132 to $193,534), and in Forest Park from $222,142 to $192,123 (-15.6 percent).”
“‘Some people in the industry asked me, ‘Aren’t you concerned that homeowners will be discouraged by it?’ Well, I’d rather they be a little disappointed now, rather than be in denial about home values and get blindsided later,’ said Richard C. Gloor Jr., president of Better Homes and Gardens Real Estate Gloor Realty in Oak Park, which did the report.”
“‘”This really shouldn’t be surprising news for anyone,’ said Gloor. ‘We simply want to be upfront with the facts. The truth is that Oak Park, River Forest and Forest Park have all fared relatively well. This is a strong market and there’s no question that it will absolutely remain that way.’”
“He noted that between 2003 and 2008, Oak Park home prices are up 22 percent, while in River Forest the increase has been 44 percent and in Forest Park, 37 percent. And collectively, compared to 2000 levels, home prices are up nearly 90 percent, with Forest Park up 108 percent, River Forest up 95 percent, and Oak Park up 69 percent.”
“‘When taking even a little bit of a longer view, it’s clear that we have experienced strong growth in home values,’ said Gloor. ‘It’s so important to maintain a perspective that is more historical than hysterical.’”
“In the Chicago-Naperville-Joliet area, home prices decreased 11.8 percent from Nov. 2007 to Nov. 2008, according to First American CoreLogic and its Home Price Index. The three-city area had the 14th largest decline in the nation. The current median price of a home in Chicago-Naperville-Joliet is $230,000, the report said. Sales of single-family homes decreased by 45.8 percent in Chicago-Naperville-Joliet in November compared to the same time last year.”
The Southside Times from Indiana. “The Southside housing market is doing quite well, thank you. Banks have mortgage money to lend, interest rates are low and houses in Indiana are more affordable than in many other states. That’s the message a newly formed Southside alliance of Realtors and real estate brokers are promoting. They want to counter the doom-and-gloom economic forecasts portrayed almost daily by the national news media.”
“‘We’re proud that Southside Realtors came up with this unique idea of an alliance,’ said Mike Watkins. ‘We just have to get the message across that now is the time to get a good deal on buying a house.’”
“The alliance has brought Realtors and brokers closer together after a period of technology, such as cell phones and e-mails, kept them apart. ‘It’s getting to be like the old days. We’re talking to each again, once more have a spirit of cooperation, and we’re in it to where we all win,’ Linda Leveridge said.”
The Herald Palladium from Michigan. “You’ve been hearing stories about falling housing prices, but when your property tax assessment notice arrives later this month you’ll see an increase in your taxes. What gives?”
“The answer lies in a change Michigan made in the mid-1990s that pegged property taxes to the inflation rate and for the most part decoupled them from a house’s assessed value. Figures from the National Association of Realtors and the Michigan Association of Realtors state that during the past year, average house prices have fallen 15 percent nationally, 16.19 percent in Michigan and 7.74 percent locally.”
“Local assessors said these figures are misleading because they include foreclosures, family sales, sales done under duress and estate sales, which assessors can’t use. Assessors can only base their assessments on sales done freely in the open market.”
“It’s been a good ride. Longtime property owners have benefited greatly from Proposal A during the past 14 years. The Michigan Department of Treasury reports on its Web site that home values in Michigan have increased by 98.4 percent since 1995, while property taxes have only increased by 42.9 percent.”
“In cases of foreclosure, St. Joseph Township Assessor Sue Rice said the selling price is often much lower than the house’s true market value. In that case, she said the assessment would not be lowered to match the selling price. ‘That (the selling price) doesn’t reflect what it’s worth,’ she said. ‘You just got a good deal.’”
The Huron Daily Tribune from Michigan. “While reports show foreclosures are on the rise just about everywhere, the number of mortgage foreclosures in Huron County actually decreased slightly from 2007 and 2008. Huron County Register of Deeds Sheri Stanton said there were 91 mortgage foreclosures in 2008, which is a decrease from the 98 recorded in 2007.”
“Deputy Mike McCormick, who works in the Huron County Sheriff Office’s Civil Process Division, said he has seen no decrease in the amount of foreclosure activity. For example, in 2008, there were a total of 178 postings (which is a posted notification stating a property is in foreclosure), and more than 300 adjournments (which are delays of mortgage foreclosure sales because an agreement has been reached between a property owner and financial institution).”
“‘I’ve had some properties that have been adjourned (every week to the next week) for six months,’ he said in regard to the amount of activity he’s seen regarding area mortgage foreclosures.”
“Regarding the actual number of sales, McCormick said he’s seen a huge increase from 2006. ‘We would do about four foreclosure sales a month (in 2006),’ he said. “We’re doing four to six a week now. It’s just gotten crazy.’”
“Tuscola County Register of Deeds Daniel L. Grimshaw reported mortgage foreclosures were up from 277 in 2007 to 323 in 2008. ‘And we’re not done going up yet,’ he said. ‘We already had 22 recorded this year for January.’”
“The number of sheriff’s deeds recorded in Tuscola County has steadily increased from year to year, Grimshaw said. For example, there were 146 reported in 2005, and 203 in 2006. Just out of curiosity, Grimshaw said he had looked up the number of mortgage foreclosures back in 1930. ‘That was the first year of the Depression, and we had 59 (mortgage foreclosures),’ he said. ‘My guess is that we’re not done climbing yet. This is by far the worst that I’ve seen in the real estate industry in the almost 20 years that I’ve been involved.’”
The Holland Sentinel from Michigan. “Curtis Sall used to build about 50 new homes a year. He hasn’t built one in two years. Sall said he was forced to figure out a new way to make money. ‘What can we do in this market?’ asked Sall. ‘We can’t sell like we did … We have to adapt.’”
“He and his business partner, Realtor Paul Brooks, have since come up with an idea Sall said will be good for the city of Holland. The plan: Purchase cheap, run-down homes near downtown resulting from the ‘foreclosure tsunami,’ fix them up and resell them for an average of $80,000. That’s 20 percent less than what they sold for a few years ago, before they were fixed up.”
“In the last year, the men have bought 15 foreclosed houses, which included two outside of the area — a $2,900 house in downtown Grand Rapids and a $9,000 home in Fennville. Sall and Brooks have sold about five renovated homes so far, with many still in process. They said many potential customers, however, are either too scared to commit or have a checkered past.”
“‘The people that do knock on our doors do have credit issues,’ Sall said.”
The Kenosha News from Wisconsin. “The changing mortgage market is cutting into the ranks of independent brokers. Virginia Murphy, one such broker for the past 25 years, decided last month she could no longer work in the industry on her own. She closed shop and joined a larger brokerage in Kenosha.”
“The real estate boom helped her business grow, but when the market contracted she initially figured she would be able to weather the storm. ‘In 2007 there was a gradual decline,’ Murphy said. ‘In 2008 it got very stressful, and I was just worried about keeping the lights on.’”
“In Kenosha County, people who had ridden the coattails of the real estate boom began to flee the business. Developers pulled back from housing plans. Some high profile real estate investors…saw their properties fall into foreclosure. The Kenosha Realtors Association saw its membership decline from 568 at the end of 2006 to 392 in 2009.”
“The ranks of the independent mortgage brokers began to contract rapidly. Of 32 Kenosha-based companies on a Web catalog of Wisconsin mortgage brokers, just four still have working phone numbers. ‘They dropped like flies,’ said Realtor Larry Cappozzo.”
The Toledo Blade from Ohio. “The house had mold, a leaky roof, and a somewhat checkered history for its link to one of Toledo’s most high-profile investment fraud cases. But new owner Mark Davis couldn’t be happier with the deal he struck. ‘I felt I got a steal,’ said Mr. Davis.”
“He bought the house last year from the mortgage-holder after a foreclosure. It is the former residence of John Ulmer, who faces trial next month on charges of fraud and racketeering. The price was less than half the 2006 appraisal of $553,000. More important, the sprawling six-bedroom house built in 1956 carries one of the metro area’s toniest addresses: Underhill Road in Ottawa Hills. And it isn’t the only deal there.”
“The listing for one property, whose owners are seeking $796,000, boasted a recent ‘$200,000 price reduction.’ The wealth of the 4,600-person enclave, with rolling hills, parkland, and million-dollar dwellings, has been unable to insulate it from the problems vexing housing markets nationwide. Owners who couldn’t keep up with mortgage payments have locked the doors and walked away from some houses.”
“Lucas County delinquent property-tax rolls include a $1.1 million estate whose owner is behind by $33,000. As of last week, about 2 percent of the village’s homeowners owed $100 or more each in back taxes, the county treasurer’s office said.”
“Median family income is $117,000, or more than double the average for metro Toledo, according to the 2000 Census. But, in the current economy, even the rich are suffering. ‘People don’t have the expendable cash like before because the economy is down,’ one resident observed. ‘A lot of people in Ottawa Hills are self-employed.’”
“There were 68 homes sold in 2008, or 15 fewer than the year before, village officials said. ‘It’s a little slow,’ said Betty Lazzaro, a real estate agent with numerous listings in Ottawa Hills. ‘Everybody is looking for a bargain now. If the seller is in a position to sell at a low price, they sell. If not, they hang on.’”
“The biggest obstacle to selling high-end homes is a lack of consumer confidence in the metro Toledo real estate market, said Mark Kruse of Danberry Co. Realtors. ‘Buyers don’t want to buy something for $1.2 million and find out five years from now that it’s worth $800,000,’ he said.”
“Nearby, on Brookside Road, another foreclosed home was transferred to the mortgage-holder on Feb. 2. The family that lived there once owned a 2005 Volvo and a 2005 Mercedes Benz. But the man, who worked in finance, lost a job in 2006 and turned to substitute teaching. They bought the 1927 brick Colonial for $427,000 the year before.”
“Some owners who are unable to sell rent their homes. That is the case with a California woman who came here to start a business, bought a $1.1 million house, and returned to the West Coast when the business failed to pan out. The $2,000 she receives in rent each month covers only a portion of her ownership expenses, said Ryan Phillips, who works for the management company that oversees the property. ‘But she didn’t want it vacant,’ Mr. Phillips explained.”
“Village officials insist that the real estate market in Ottawa Hills is no worse than markets elsewhere. Prices have declined 15 percent in recent years, conceded accountant Kevin Gilmore, who serves as village mayor. ‘In Florida, they would be ecstatic about 15 percent declines in value,’ he said. ‘Everybody everywhere is sick about what’s going on.’”
