January 25, 2016

Back To 2004 and 2005: Thinking About It Isn’t An Option

The News Press reports from Florida. “‘Hitting on all cylinders’ is how Naples-area real estate pros described their market’s 2015 performance at Friday’s NapLes Area Board of Realtors year-end wrap. 2014 and 2015 were near-record years in almost every category, according to Downing Frye realtor Mike Hughes. ‘It’s unusual to get two great years in a row. It made me flash back to 2004 and 2005,’ Hughes said. A word of advice to low-end home buyers: number of days on the market are getting vanishingly close to zero. ‘Low-end buyers need to be prepped to move quickly. Thinking about it isn’t an option,’ Hughes said.”

“But the surprise of the year was land. ‘Someone once said, ‘Under all is the land.’ It is so true in Naples,’ said appraiser Cindy Carroll. ‘Recovery has been taking place in the underlying land value,’ she concluded. Even in Golden Gate city, where lots in the recession sold for 7 cents on the dollar, vacant land is listing for $80,000, at or above pre-recession prices.”

ABC 7 News on California. “The U.S. stock market isn’t the only part of the economy affected by the slide in Chinese markets. The U.S. stock market has followed suit and the ripples are starting to hit the Bay Area real estate market. ‘The Chinese economy has seen quite sharp drops in the stock market as well as general economic activity,’ said Ralph McLaughlin, the chief economist for Trulia. McLaughlin says hits from China are down nearly 50 percent so far this year. ‘What we see is quite a decrease in the number of Chinese home seekers looking for homes on Trulia in San Francisco,’ said McLaughlin.”

“Mortgage broker John Holmgren says some of his local clients, who are relying on their stock portfolios for a down payment on a house are having second thoughts. ‘We have a lot of clients, who are from the tech sector and they had stock options they were about to exercise that were in the money that would allow them to cash in and make a down payment. Now, not so much,’ explained Holmgren.”

The Herald Mail in Maryland. “The number of properties that received a foreclosure filing in Washington County was 39 percent higher than the previous month and 24 percent higher than the same time last year, according to RealtyTrac. Jeff Matthews, president-elect of Pen-Mar Association of Realtors in Washington County, said homeowners find themselves in foreclosure for a number of reasons. ‘Part of the problem is interest rates,’ Matthews said. ‘Adjustable interest rates have creeped up on them. And, life happens. A loss of a job can have an effect.’”

“As a result of the nation’s mortgage crisis in 2008 and 2009, when foreclosures peaked around the country, lenders have been forced to work with delinquent homeowners to help them stay in their homes. Yet Washington County Circuit Court still processed 536 new foreclosure filings in 2015. ‘It still amazes me that many mortgages are in trouble,’ Circuit Court Clerk Dennis Weaver said. ‘It has to affect the housing market.’”

The Roanoke Times in Virginia. “Foreclosures in the Roanoke area rose by more than 38 percent in 2015 from the previous year, according to RealtyTrac. Lenders are still working through foreclosure procedures even years after houses were vacated. Roanoke Realtor Bonnie Hall, who deals almost exclusively with foreclosed properties, said a lot of the new properties are so-called shadow inventory — properties that stalled in foreclosure and have not been sold, or homes that banks delayed putting on the market until conditions improved. She said she had more foreclosure properties sent to her this winter than she has seen in the last five or six years and doesn’t expect it to slow down any time soon.”

“Many of the properties were vacated during the recession but are just now hitting the market. Kit Hale, a broker at MKB properties in Roanoke, said 2015 showed a drop in the foreclosure properties sold and, ‘with an improving market, I do not believe that shadow inventory is so pent up as to saturate our market in 2016.’ ‘While I’m sure some REO companies are holding inventory until the market improves, I do not believe it is a significant number,’ he said. ‘Over the last five years, there has been an unbalanced inventory as it relates to demand. In other words, we have been in a sustained buyers’ market due to REO properties and company relocations.’”

The Casa Grande Dispatch in Arizona. “After years of serving as an unofficial monument to the housing collapse, a long-standing cluster of vacant homes south of the railroad tracks in Maricopa was demolished last month. Santa Rosa Crossing sprang up from Hallcraft Homes in 2004-05, with the builder constructing several homes before the market began to go bad, forcing the development into bankruptcy. Realtor Brian Petersheim started working the real estate scene in Maricopa in 2006, with a specialty in new and spec home sales. ‘Every time I would go by, it would be locked up or nobody would be there,’ Petersheim said. ‘After doing this for about six months, I noticed the trailer was all of a sudden locked up.’”

“Martin Scribner, director of development services for the city of Maricopa, said 29 homes were built to be offered to buyers before the bottom fell out. ‘Basically these houses have sat empty for 10 years, and they never were lived in,’ Scribner said. Scribner described the properties as having been ‘pretty much wrecked.’ When asked why it has taken so long to tear down the vacant homes, he said that was a good question. ‘In the past, when everything collapsed, it wasn’t really a priority,’ he said. ‘There was so much going on, so many empty houses. Yeah, it was a blight.’”

KGW in Oregon. “Stars of the HGTV show Flip or Flop are speaking out about their canceled appearance in Portland late last year. In an article posted on the real estate site Zillow Porchlight, Christina El Moussa talked about the controversy that surrounded the couple’s scheduled seminar, which promised to teach the ins and outs of buying, renovating and selling houses.”

“El Moussa wrote: ‘You might have heard that we cancelled the Success Path training tour through Oregon and Washington, as was reported in The Oregonian, due to a vocal group who somehow linked us to the issue of affordable housing. We are very accustomed to being on the receiving end of people’s opinions. My hairstyles, my mothering, and my interior design choices in flip houses — all are discussed. Rent affordability is not a local issue. All across America, and abroad, it is a serious topic worthy of discussion. There is no simple solution to such a complex and sensitive situation. When demand exceeds supply there is tension.’”

Bits Bucket for January 25, 2016

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