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August in Review–Ada County:

September 15, 2010 By Matthew Le Baron Leave a Comment

August sales in Ada County were 421. That’s a decrease from August ’09 of 19%. Year-To-Date ’10 is now 3,954; an increase of 18% over the first eight months of 2009. Historically, sales volume is about the same July to August. From 2006 to now we’ve had two years with decreases, one year with an increase and one year in which it stayed the same. This August was up over July ’10 by almost 7%.

Of our total sales in August…52% were distressed….up 6% from last month.

Pending sales rose slightly in August to 724; from 700 in July. Pending sales in April were 1,162; May 806.

The percentage of pending sales in distress fell 3% from July to 43% overall. That’s down nearly 22% our high in March. One bright note, default filings continue to slow.

Inventory took its biggest “hit” in August; falling from 3,288 in July to 3,094. At the same time, the percentage of active inventory that is distressed, showed no change from July…holding steady at 39%. In Ada County we have 8 months of inventory on hand. The price category in shortest supply…$200k – $250k at 7.2 months.

Median home continued to improve; holding on to gains made starting in March of this year. In August our combined median was $163,000; down 4.1% from August ’09. We’ve been enjoying median price improvement since February. YTD comparison to ’09 is off 9.6%…and closing. New Homes median price, for those 59 people who bought new homes in August, increased by almost 6% over this period last year. At the same time it dropped $27k from July. Interestingly, average sales price retreated from the $200k numbers in July to $186,608.

source: acar

Filed Under: TrustIdaho.com Featured Tagged With: bank owned, distressed sales, foreclosure, short sale

DISTRESSED SALE STATISTICS

August 10, 2010 By Matthew Le Baron Leave a Comment

Filed Under: TrustIdaho.com Featured Tagged With: bank owned, foreclosure, reo, short sale

Buyers and Sellers Resource Guide

April 22, 2010 By Matthew Le Baron 1 Comment

There has been a lot of recent banter that the housing market is rebounding. Others have said that while that may be true there is still a looming 2^nd wave of foreclosures. The second wave of home foreclosures that is potentially coming down the pipe has experts suggesting that even more borrowers could be affected. Luckily we’re better armed with information to make this second wave a bit less crushing. This resource guide should help both buyers and sellers during the possible 2^ndwave of bank foreclosures.

The 2010 Foreclosure Problem

The first round of repossessed homes was in large part borrowers with adjustable rate mortgages, subprime mortgages, and investors who purchased too many homes at once. This second round of home foreclosures is expected to affect borrowers who might have decent interest rates and loan terms, but just simply cannot afford to pay their mortgage. Homeowners who have been in their homes for 10+ years but who are now struggling to pay for them due to unemployment are one subset of this expected group of the affected. The good news is that we’re better prepared for it now. There are resources that can help you during this time whether you need to sell a foreclosed property or want to take advantage of the option to purchase one.

Resources for Sellers

If your home is nearing foreclosure and you want to try to sell it, you need to fully understand the process of selling a foreclosing property. These resources can help.

How to Sell Your Home Fast When Foreclosure Looms. This post provides great tips for sellers who may face foreclosure in the months to come. It describes how to understand the true value of your home at this time as well as who you should align yourself with.
Our very own site can provide resources for borrowers looking to sell their home before it goes into foreclosure.
Selling your House in a Sea of Foreclosures. The authors of this article understand that you are not the only person selling your home right now. With so many other people in the same boat, you need to make your home sale stand out.
How to Sell Your House Before Foreclosure. This basic how-to article provides a simple set of six steps that will allow you to get a great overview of the process of selling a home.
Pre-Sale Foreclosure FAQ. What are the questions that you might have before you sell your home which may be nearing foreclosure? This article anticipates those questions and answers them for you.
Avoiding Foreclosure. You might not have to sell your home after all. You may be able to avoid foreclosure altogether. This page from HUD.gov educates you about how to do that.

Resources for Buyers

Buying a foreclosed home can be a terrific investment. However, you need to know what you’re getting into. These resources found below should assist you:

The Safest Ways to Buy Foreclosures. You don’t want to take any risks when buying a foreclosed home. This article provides information that will keep you safe.
How to Buy a HUD Home. This article anticipates the questions that new buyers might have about purchasing a government-owned foreclosed home. The answers are contained within the site.
How to Buy Foreclosures. RealtyTrac offers a great five-step plan to buying foreclosed homes. Their article provides an overview of the process as well as detailed information about what each of the five steps will involve.
How to Buy Foreclosures at an Auction. There are several different approaches to buying a foreclosed home. Auction sales are one option. If that option appeals to you as a buyer then this article is a great resource.

General Resources

Whether you are selling or buying a foreclosed home, there are some basic things that are worth learning. Take a look:

How You Can Take Advantage of Strategic Foreclosures. Our recent blog post discusses strategic foreclosures, and how you can take advantage of others home losses, and gain a beautiful home.
RealtyTrac Foreclosure Guide. This website has a terrific overview of what foreclosure really is and what it means for everyone involved. It defines terms, provides helpful links and really assists you in staying educated through the whole foreclosure process.
FTC Facts for Consumers. Both buyers and sellers should fully understand foreclosure and the steps involved leading up to foreclosure. The FTC provides comprehensive information for consumers about this topic.
Foreclosure Databank. This website has loads of information and listings about current foreclosed homes for sale. This is great for buyers who want to see what is out there but is also useful for sellers who want to gain information about real life foreclosures.
Short Sales and Foreclosures. About.com has a great Home Buying/ Selling portal. Within that portal is loads of information about foreclosures. This information is helpful for both buyers of bank owned homes and sellers at all stages of foreclosure.
Aftershock: Second Wave of Foreclosures Coming. This article will assist you in better understanding what is happening with the current wave of foreclosures. The more you understand this, the better off you’ll be during this tough time.

These resources are all terrific places to start to gain information about buying and selling foreclosures. However, don’t limit yourself to online information. Foreclosures have already affected a lot of people including people who you already know. Speak to the folks in your social network as well as to professionals, such as myself, in the local real estate and mortgage industries to gain additional one-on-one advice about coping with this new wave of foreclosures.

source: gohoming.com

Filed Under: TrustIdaho.com Featured Tagged With: 2nd wave, bank owned, foreclosure, reo

OVER 406 BANK OWNED HOMES FOR SALE IN ADA COUNTY

March 6, 2010 By Matthew Le Baron Leave a Comment

As you probably know, there is a plethora of bank owned homes for sale in Boise, Meridian, Eagle, Kuna and Star. Banks are motivated to sell and will typically price these distressed homes 10-30 percent under current market values. Granted, most do need cosmetic work done prior to move-in such as new carpet, paint, lawn maintenanceand other misc items. However, there are some bank owned property which the previous homeowner has taken it upon themselves to leave the residence in nasty shape by taking a sledge hammer to walls and doors along with pulling all appliances like the range, dishwasher, disposal and microwave (sometimes water heaters and furnaces, too). Unless you would like to take on the costs, I suggest bypassing some of the bank owned homes on the market.

It is also important to not look for only bank owned homes. There are numerous non-distressed homes on the market (fair market sellers) that must sell. These homes are priced competitively and do not need the improvements that a foreclosed upon home typically does. With that, it is important to consider the costs of repairs when deciding whether to purchase a home which needs some love (yet is priced lower than the home down the street) or one that is turn key and ready to be moved into.

Bank owned homes will be prevelant in our market through 2010 and part of 2011. Would you like a list of bank owned homes forwarded to you? If so, send me an email with your contact info and I will provide a list of bank owned property currently on the market.

Filed Under: Buyers Tagged With: bank owned, distressed, foreclosure

Buying a foreclosed home 101

February 19, 2010 By Matthew Le Baron 3 Comments

Don’t bother browsing through the legal filings in your local paper or showing up to courthouse auctions—there is too much risk and most banks will not sell at auction for less than the amount currently owed against it. Instead, contact myself or another Realtor at Trust Realty that can provide a list of homes for sale that are bank owned. Also, you can go directly to www.TrustIdaho.com to search specifically for bank owned property being offered at rock bottom prices.

It’s makes more sense to purchase homes that are being sold directly through the bank since a buyer purchasing homes at foreclosure auctions must have cash on hand at the time of the sale and typically hasn’t had an opportunity to inspect the home appropriately. Also, many homes sold at auction may have additional liens such as a home equity line of credit or a second mortgage that may have fallen under the cracks. If that is the case then the buyer of the auctioned home is responsible for clearing the lien(s).

When a bank takes final possession after foreclosure and lack of a winning bidder at the auction, the entity will clear the home of all liens and encumbrances. When buying a bank owned home, the purchaser has an opportunity to inspect the home and the offer and earnest money put down is contingent upon buyer approval of the inspection. A home purchased directly from the bank can also be financed.

Bank owned homes currently for sale on the public market typically have been sitting vacant for no less than six months and have often been vandalized or stripped of items such as water heaters, oven/ranges, microwaves and even cabinetry. “One mistake a lot of people make is underestimating how much work the home needs and the cost associated with fixing it,” say Rick Sharga of RealtyTrac. To avoid getting stuck with any surprise bills, it is essential to have a certified home inspector provide the true condition of the home. Secondly, it is important to properly estimate the amount of time and money needed to bring the home back to a livable condition.

Be aware, not all banks are selling their inventory (foreclosures) at fire sale prices; some are listed at or around market value. However, most firms offer property at or around 10% under current market value with the hope that a buyer will purchase within a 30-day timeframe. The larger the inventory of foreclosed homes the bank is holding along with the length of time the home has been on the market will determine your chances of nabbing a home drastically under market value.

Determine your offering price by finding out how many days the home has been on the market along with the activity associated with it (it is important for your representation to inquire with the banks representation to find out if there are alternate interested parties). I suggest offering 10% under the banks asking price unless it is found that the bank is highly motivated. You must also consider alternate buyers that may be willing to pay more than you at that time.

Be prepared to wait for a response to your offer when attempting to purchase a bank owned home. While some banks respond w/in 36 hours, others dealing with an enormous backlog can hold up response for as long as three month. While you wait, another party can unfortunately trump your offer with a higher one. With that, it is important to have multiple properties in mind and to get pre-approved for financing prior to making an offer (unless you plan on purchasing with cash). Even if the home of your dreams has gone into pending status prior to you writing an offer for it, be sure to have your representation continually check the status since real estate transactions do fall.

Remember, it is essential to have representation when purchasing bank owned, short sales or fair market homes. Contact me today to discuss the possibilities!

Filed Under: Buyers Tagged With: bank owned, foreclosure, foreclosure auction, lender

Short Sales 101

February 15, 2010 By Matthew Le Baron Leave a Comment

Brushing up on your short sale knowledge is essential in this market since nearly 50% if all homes currently for sale are distressed (either short sale or bank owned). Bank owned homes can typically be purchased within 30 days since the home has been foreclosed upon and title has been transferred to the bank. Purchasing a bank owned property is very similar to purchasing from a normal seller yet there are much more disclosures involved. A short sale means that the current owner is requesting the bank to take less than what is owed in order to avoid foreclosure—short the bank on what is owed is a way to look at it. This requires approval from the lending institution.

The process:

1) To be a short sale, the homeowner usually is in default or in a position to be in default (divorce, loss of job, injury, etc) The seller most likely has tried to get their loan modified yet to no avail. Next step is to place the home on the market as a short sale.

2) The agent marketing the property will advertise to the public as a short sale. Short sales are typically priced very aggressively yet it is important to remember that the bank determines the final price.

3) An offer is submitted to the seller and the seller accepts it in writing (unless the seller feels that the offer would not be accepted by the bank)

4) The seller will compile a short sale package for submittal to the lender (or lenders) that includes the executed offer, seller financial statements, bank authorization letters, previous 2 years taxes, a hardship letter and listing agreement.

5) Once the package is submitted to the lender the buyer and seller must wait for approval. The lender will typically request an appraisal to be completed firstly in order to determine value. Second, they will compare proceeds of the short sale to the proceeds received if the home is foreclosed upon in order to determine whether or not the sale can be approved. Banks such as B of A and Chase can take as long as 4 months for a response. Patience is a virtue!

6) The bank approves, rejects or counters the offer. If there is acceptances of your offer then expect to close w/in 30 days after the approval is obtained.

It is important for a buyer who is pursuing a short sale to keep all options open. Most offers submitted on a short sale can be cancelled at any time prior to bank approval by both the buyer or the seller. With that, I suggest continuing to look for homes while the offer is working its way through the approval process. More often than not, an alternate home will come onto the market that fits the buyer’s needs and IS NOT a short sale.

The lending institutions are working in association with the US Government to streamline short sales during the year of 2010 and beyond in order to decrease approval timeframes that in turn helps fewer homes go into foreclosure. Personally, I have noticed that banks are already responding to short sale offers more rapidly and hope that the trend continues.

Filed Under: Buyers Tagged With: bank owned, foreclosure, short sale process, tax credit

The New Normal?

February 1, 2010 By Matthew Le Baron Leave a Comment

The crisis that almost collapsed the financial system, the markets and the economy was a once-in-a-lifetime event for most of us. The effect was not only monetary, but psychological. Shifts in attitudes about money, financial independence, retirement, leverage and consumption may leave their marks for years to come.

Many people have seen the values of their financial assets, including real estate, drop close to 18 percent; however, few have changed their approaches to investment management. Some affluent investors suffered losses of 40 percent to 50 percent – enough to shatter their faith.

January is Financial Wellness month, so let’s take a quick look back and then think about what’s to come and how to work toward restoring some semblance of stability.

There is a lot of evidence out there to support all the scary thoughts. The 100-year flood happens about every five to seven years. Markets are never average or normal and are usually above or below the bell curve. The tools available to make investment decisions are not forward-looking. They are always historical. Can you imagine using only the rear-view mirror?

Financial advisors need to help people rebuild plans that address new economic realities and long-term goals. With my long-time clients, I still check and double check to make sure I understand their thinking and feelings. In many cases, my clients’ families have become even more important, and we include them in meetings. Mindsets continue to shift, and approaches need adjustments. Simply keeping in touch is more critical than ever.

Many successful Americans come from average backgrounds and circumstances, and have worked hard to earn their success, wealth and comforts. Their financial position, investing and saving has been a source of pride. They felt they understood the rules of the game – the American dream. The sharp downturn in real estate values, falls of some of the leading financial institutions and job losses lead to weakened faith in the system.

Some have responded by shifting their behavior, reducing discretionary spending and looking for exceptional value. Psychologically, it feels wrong to be wasteful. Saving feels more moral and has increased significantly in recent months.

We’ve arrived at a time many are referring to as the new normal.

High unemployment and slow growth for the U.S. Gross Domestic Product of 1 percent to 2 percent have been forecast. This will be unacceptable to Americans, who will put pressure on politicians to encourage domestic growth. Americans are burdened with high debt and slow growth. Some are unhappy with government presence.
How do we turn the economy toward healthier growth and exports with a cheap dollar? These are questions that will continue to be explored into 2010. In the new normal, people will think and plan differently for the future.

There is a sense that the worst is over and a kind of pride in surviving the worst of times. There is a satisfaction that comes from emphasis on real needs, simple pleasures and a focus on managing what one can control. People are taking pride in their shopping skills. Shopping at thrift stores is no longer just fun and funky; it just makes more sense, in most cases, than buying new.

I’ve seen family ties that have been strengthened. In times of financial crisis, many families are forced to communicate. Even divorce rates are falling.
In the investment world, we’re focusing on quality and value, which is fundamental.

There is some evidence of renewed confidence. But investors remain cautious. Low-quality investments in the early stages of recovery may be attractive, but can be far too risky. It is important to measure the risk of investing against the risk of not investing. Staying in cash at no return won’t help in the long term.

Don’t sit and wait. Know what to fear and what may be advantageous. Embrace the new economic reality.

**IBR

Filed Under: TrustIdaho.com Featured Tagged With: bank owned, investors, market stabilized, Real Estate Recovery, short sales

Sweat Equity on the Rise!!

November 13, 2009 By Matthew Le Baron Leave a Comment

Jim and Kristina have taken advantage of the real estate market.

At the start of 2009 this couple sold their home in Meridian with the intention of moving to California to be near family. After months and months of looking at several homes in the Golden State, the couple became discouraged and began to sense that Boise Idaho’s pricing, along with quality of living, was too good to pass up. With that, Jim, Kristina and I began a search for their new home.

New construction, short sales, bank-owned property and occupied homes alike all had positives and negatives. When the dust settled, however, the couple found that a well-built bank-owned property within a cozy community fit the bill very nicely. Although the floors were ratty, the paint distasteful and curb appeal lacking, the home had much potential. The kitchen was open and bright with plenty of cabinet space, the floor plan flowed with ease and the quality of construction was first rate. In 2006 this home would have sold for the mid 180′s but by working together, the Beans were able to make the purchase for only $130,000.

Jim and Kristina have always been “handy” people. In fact, while in California the couple spent many weeks helping their son and daughter construct their personal home. During this time, Jim and Kristina learned trades that included installing tile, hardwood flooring, siding-you name it!! The knowledge was definitely put to good use.

The work began. Kristina began stripping the countertops and laying tile. Jim started pulling the dirty carpet and ripped vinyl planning to lay a hickory floor. All the while, doing prep work for the full interior paint job. After nearly 30 days of sleeping on cots and eating cold dinners, the Beans completed their project and invited me over to see the results of their “sweat equity”.

I could hardly believe that it was the same home! The smell of fresh paint and lacquer was prevalent while Kristina excitedly directly me toward the kitchen. Granite and tile graced the middle island, countertops and backsplashes; the cabinetry was antiqued while the stainless steel appliances topped it off. “Wow!” I exclaimed. Next, Jim spoke about the hickory flooring that was laid throughout the first floor. It was gorgeous and only cost $1,000 for the material! Jim and Kristina were proud of their work and had every right to be.

Before leaving, Jim and I discussed the market and what the home might sell for right now. At least $150,000, I mentioned, if not more. Jim stated that he and Kristina had put $2,000 (plus or minus) into material and couldn’t be more thrilled that they had realistically made $16,000 for their time. “In a year or so, Matt, we’ll be doing this again. And also, my kids down South are itching take advantage of the pricing around here”.