Kris Wales - Macomb County MI real estate blog & homes for sale search site

I received an ActiveRain contact email from a young lady at 1:50 p.m. I returned her email at a little after 2 this afternoon, and we spoke a few minutes later.

In her email she stated "..am having trouble reaching an agent to help me." During our phone conversation she stated that I was the 5th agent that she has contacted, and I'm the only one to return her call.

Mind boggling isn't it? Absolutely mind boggling.

What does this young lady want to do? She wants to look at homes for sale. Simple enough. She wants to see some homes.

The only excuse I can think of that she hasn't had calls returned is because she was contacting the listing agents instead of first contacting a buyers agent. Maybe in time all of us who represent buyers as our profession will be able to spread the word so far and so often that potential buyers will no longer feel like they have to call the name on the sign to see a home.

Edit: The young lady just wrote to me and gave me permission to post this article. She explained further: 2 of the agents she called were the listing agents. No return phone calls. 2 other agents weren't the listing agents, and in fact one of them set her up with a Listingbook account then dropped off the face of the earth. No return calls from this agent - and it's been 9 days.

Once again: Mind boggling.

"I only want to see foreclosures"

I had an interesting conversation with a caller yesterday morning and thought I would share it with all of you. I'm hoping that by sharing it and putting it out to the public that other potential home buyers will see it, and understand the very real aspect of how this type of strategy can backfire on the home buying consumer.

For the past 3 years or so the Metro Detroit area has been swamped with foreclosed upon homes hitting our real estate market. ( This trend has somewhat trickled in the last few months, mainly due to the new 90 day "let's work it out" mandate from the Michigan government to home owners & lenders.)

Because of the supply (overabundance) and demand (waning demand due to economic conditions) the market not only tipped to the buyers advantage side, it fell completely over on it's side.

What happened to other home owners who wanted to sell their homes during all of this? They had to price their homes competively in order to be successful at selling their homes.

In the last year I have not sold one bank owned (foreclosure) home. All of the homes that have sold to buyer clients have been homes that were owned by the sellers, and not in distress. They sold because they were well maintained and more imporantly, were priced to sell with the competition of the foreclosures in mind.

Mr. or Ms. Macomb County MI home buyer: If you "want to see only foreclosures" you will quite possibly missing out on some of the best deals there are out there right now. Privately owned home owners are pricing their homes to compete with the foreclosures.

Consider this case on point: Ms. Buyer purchased a condo in Chesterfield Township for $107,000 in June of this year. The condo sold new in 2003 for $187,000. It was in wonderful condition and needed nothing to be able to move in to it. It was not a bank owned home. If she had limited herself to only viewing foreclosures she would have missed out on this fabulous condo at an unbelievable price.

I normally write blog posts that are geared for my local consumers (Macomb County MI) but this one is going to affect all of us who have buyer clients using FHA for their mortgages and condo purchases. (Please read HUD Mortgagee Letter 09-19 , HRAP/DELRAP, for all the specific details of the way HUD will approve - or not - a condo complex.)

One of the websites that I rely on when looking for condos for my home buyers is https://entp.hud.gov/idapp/html/condlook.cfm . It's a nice look-up site for buyers and their agents to find out if a condo complex has been approved by HUD for FHA home buyers.

Just a bit ago I went to the above site to look up a condo complex in my area because a new listing popped on the market that matched my buyers criteria and noticed that HUD had changed their screen/search function to reflect the changes that are coming to their approval process. We now are being prompted in the first drop down box to search for HRAP/DELRAP approved condos, or pre-HRAP/DELRAP condos:


Condominium Approval Method

• HRAP/DELRAP: New HUD Review and Approval Process (HRAP) or Direct
Endorsement Lender Review and Approval Process (DELRAP).

• Pre HRAP/DELRAP: Former approval process.

Revised: September 1, 2009

**My understanding is that the new HUD approval process doesn't begin until October 1st, 2009 but it appears that HUD is ramping up for it. You may want to check with your favorite mortgage lenders to find out if their underwriting process is going to make these changes before the October 1st deadline, as we saw with other program changes that started to take affect before "deadlines" actually occurred. I'll be checking with my mortgage partners tomorrow so that there aren't any surprises for my current condo buyers.**

This year has been full of fun changes to our industry, hasn't it?

Another blog article a bit more specific about the changes coming to condo purchases using FHA mortgages: Heads up everyone - we could be in for some fun!

While you've been waiting for the housing market to "hit bottom" a few things have happened:

• The number of bank owned homes on the market in our area (Macomb County MI) have fallen drastically. This means that suppy and demand is now on the demand side of the equation. Want to buy a foreclosure? Get in line. There are hundreds if not thousands of buyers looking for foreclosures.
  
• There are multiple offers on the clean, well priced homes. Not only do your odds of purchasing the home that you and your agent found decrease, but odds are you will be paying more for the home than the list price in order to be the winning bidder.
  
• More homes subject to a short sale are now on the market in our area. Have patience if you want to purchase one of these homes. You'll need it. Plan on 60-120 days to hear back about your offer from the mortgage holder. You don't want to make an offer on a home subject to a short sale? I don't blame you. However you should know that this eliminates many of the homes on the market for you to view and consider.
  
• Mortgage program guidelines are even tighter and more stringent than they were 3 or 4 months ago, and I see this continuing to happen while the housing market shifts & turns and until it corrects itself.

If you want to keep waiting for the housing market to "hit bottom" that's ok. Please keep this in mind though:

We cannot predict when the bottom will hit. We can only inform you as to what we are seeing and experiencing now as we are out and about each and every day helping home buyers with the changes that are taking place.

I am currently working with several 1st time home buyers in my area (Macomb County MI) and there is one thing that they also have in common: They do not want to miss out on the first time home buyers tax credit that expires at the end of November.

As of todays writing there are only 69 business days until the tax credit expires.

A couple of things to keep in mind: It will take approximately 45-60 days to process your mortgage from the time that your offer to purchase a home is accepted. Right now the home inspectors, mortgage lenders and underwriters are swamped with business. As we move in to October I fully expect things to become much busier for them, and for buyers agents in Macomb County.

If you are expecting to take advantage of this tax credit before it expires, get started right now.