Joe Murphy

It was front page news that the number of foreclosures filings here in Manatee County has had 5687 foreclosure filings to date this year, which is an increase from last year. This is a lot of homes and as an active agent it made me wonder where are all the bank owned inventory?

• There are 4696 total active residential listings as of this evening (11/22/09). 474 "normal" are pending
• There are 149 active bank owned homes 123 pending
• There are 920 short sales active there are 940 pending

The Statistics show two big things.

1. The action is happening on bank owned, and short sale homes. You can clearly see that there is almost the same amount of pending listing vs. active in the short sale/bank owned categories. The conventional sellers have only about 10 to 1 that are pending.
2. If there are almost 6000 homes that have entered foreclosure WHY is there less than 300 active and pending bank owned properties

Factor in that there are foreclosure filings from prior years that have not been completed. Many foreclosures I am aware had a foreclosure filing well over a year ago and have not gone to auction.

Also, some of foreclosure filings that are also homes that are currently listed as short sales.

Some of the foreclosure filings can also be filed from second position lien holder,s and homeowner associations that have a low probability of actually forcing a sale. These type of filings maybe inflating the numbers somewhat.

So there are under 2000 homes short sale homes, active and under contract. This means that there are around 4000 homeowners that are either attempting a loan modification, or have given up on either a short sale, or some type of work out solution.

I would estimate that if there are 2000 homeowners short selling, than there is at least that many attempting or considering a loan modification.

Activity in Manatee County has significantly increased in the past few months. Prices have continued to drop except in the 200,000 and under market where prices have leveled. Multiple offers are much more common for bank owned homes.

Why is there only 5% of the total inventory bank owned when there is more homes in foreclosure than all active and pending sales on our local MLS?

Two reasons

1. The slow pace of foreclosures is due to the flood of files, and the increasing willingness for lenders to agree to short sales, and loan modifications.

2, Anyone that has a bunch of inventory to sell realizes that if they flood the market it will drive down prices.

I am hopeful that the lien holders will come to realize it is better to keep homeowners that want to stay in their home if at all possible. Less inventory will create price stability.

The question remains when will all those foreclosures will come on the market? I guess it is really in the lien holder's hands.

I have been working with a buyer this week, and after seeing all the resale inventory including short sales, and foreclosures they decided on a new build. What is amazing to me is that the deal they got with the local builder is BETTER than any of the comparable resales in that area.

A resale home that was essentially the same home as they purchased was an option, BUT it was 45,000 dollars more, and a SHORT SALE too. The new construction will take 8 months to close, but a short sale can take 90-180 days to close. Plus the new home has all the features and upgrades that they want.

This perplexed the buyers. The new home Should be More, but in a falling market, I explained, that Bank owned, and new builds pull the market down, since they HAVE to Sell.

A builder is not a builder if he is not building, so, he has to stay competitive in the market.

Bank owned properties have owners that want to get rid of them asap.

Short sales, and "regular" sales have a major disadvantage since they have to follow the market and are constrained to appraisal issues.

It's finally really here. Of course, this is a little old news, as people have been saying that the tax credit was approved fro the past week. Nothing is in stone until the President signs the bill into law.

It would have been nice if this could be extended to ALL home buyers. This would cause the investors back in the market in droves, and snapping up all the investment homes. Could you imagine buying a rental home for 50,000 and getting back 8,000 of your taxes?

Kind of like when everyone was driving HUMMERS because they could write off the full cost of the vehicle in the first year. I am happy with this extension because personally I have four contracts pending with First time home buyers that were probably not going to close by the deadline. It would have been ugly for all those that were counting on the credit if they couldn't get it.

Here are the highlights

• the stimulus bill will extend the 8,000 dollar tax credit to First time home buyers from the current deadline of November 30. until May 1, 2010. If you are under contract by April 30, then you will qualify as long as you close by July 1, 2010.
• "MOVE UP" buyers can now qualify for up to a 6,500 dollar tax credit if they are buying a primary home, and have lived in their current home for at least 5 years. (This is really great, although it would be better if it was for all home-buyers regardless of purpose)
• All U.S citizens that file taxes are eligible
• The tax credit has no pay back provisions so that you don't pay anything back over time, and if your taxes are less than the credit you will get a refund back.

Here is the FINE PRINT

• Home-buyers who file as single or head-of-household taxpayers can claim the full credit ($8,000 for first-time buyers and $6,500 for repeat buyers) if their modified adjusted gross income is less than $125,000.
• For married couples filing a joint return, the combined income limit is $225,000.
  
• Single or head-of-household taxpayers who earn between $125,000 and $145,000, and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.
  
• The credit is not available for single taxpayers whose income is greater than $145,000 and married couples with an income that exceeds $245,000.
• The maximum price of the home can not exceed 800,000. Bummer..

When you need a great Realtor in Manatee County please give me a call. I am ready to help.

Short sale expert, REO-Bank owned, and investment properties

Joe Murphy

Coldwell Banker Residential Real Estate

941-780-3260

This was a great day! I just had a short sale come back approved in less than 30 days pending!

I love Wells Fargo. I listed the home preparing the seller for a long painful process that would take 6 months to a year to complete. I advised her to call her lender to let them know she wanted to do a short sale.

The NEXT day, I get a call from the assigned negotiator. That same day, I get a call from the BPO agent! THIS WAS BEFORE I EVER HAD AN OFFER!

Within two weeks I get the unit under contract with a realistic buyer with a 90 day approval deadline.

The seller provids all required documents, and we sent in the contract.

(light at the end of the tunnel, and this was a short tunnel)

I get a call from the negotiator the next week with some questions, and some required changes for the HUD. No big deal.

Then, today, I get the call that the deal is approved, and the WRITTEN approval is on its way.

The only down side is that the deal has to close THIS MONTH. Wow, I called the buyer's agent who was in disbelief. They were expecting a close next year, and hopeful that we would get a response in 90 days.

This is how all short sales should go. Kudos to the Short sale dept at WELLS FARGO.

I hope this is a sign of things to come for 2010!

If you need help with selling a short sale in Manatee County Call me today. Free advice, and no cost short sale assistance. Helping buyers and sellers in Manatee county for the past 7 years.

Joe Murphy 941-780-3260

www.manateemoves.com

I just attended a Foreclosure rescue seminar this past weekend. One of the things that I learned is their is another victim besides the homeowner, the INVESTOR. These "mortgage backed securities" were supposed to be safe investments. Triple AAA rated, SAFE, reasonable returns. The kind of investments that were sold as low risk. They too are being burned in this real estate bubble.

The people in the middle: servicer(s), and the firms that sold these mortgages to the investors got their profits and no consequence.

The homeowner loses their home and credit, and the INVESTOR that actually put up real money, takes the loss. No one that originated, or sold, and resold the mortgages had any loss. In fact they are making money with fees from the foreclosures! The pension fund that owns your mortgage does not have an REO dept, do they!

I attended the seminar because I wanted to gain insight, and perspective from homeowner's and their attorneys that are attempting to defeat, or force REAL loan modifications. In some (rare) cases the homeowners are getting their home "free and clear", most often the attorneys are able to stall the foreclosure sale to help the homeowner get back on their feet. Their arguments make sense. Some of it attracts the people that are just trying to get their mortgage wiped out. Sounds good, but really this is the exception not the rule.

What I found was a lot of people that are in tough situations, upside down in their homes, but wanting desperately to keep them. These were people that I meet everyday that end up short selling their homes.

My experience is that the "token" loan modifications never include principle reduction, and typically only reduce the payment by a very small percentage. Soon they realize that if their home has lost half the value it makes no sense to stay. Short sales look attractive.

One major insight that I gained was a major conflict of interest between the "SERVICER", and the "INVESTOR". It was amazing to see how much money was made off the mortgage mess for all the people in the middle. Every time the loan was sold, repackaged, split-up, someone made money.

The servicer makes money, handling the payments for the investor. They also make additional fees when they start dealing with a default situation, then when the homeowner defaults, they make money farming out the REO deal. The investor gets the short end of the stick, they get the loss. I think that more investors would be eager to actually take principle reduction loan mods. If the "middle men" had some real incentive to make a deal happen. Just the fixed foreclosure costs being reduced from the principle would be incentive for many homeowners to stick it out, work harder, and find a way to keep their home.

In my market homes are selling for HALF of their boom price. When will the banks, and investors get it that keeping people in their homes is good for them, and everyone else too.

If you or someone you know needs help buying or selling real estate in Manatee County please give me a call, text, or email. There is help for you if you need it! I have closed 38 transactions in the past 12 months, and I am ready to help with yours. Short sales do not have to be scary.

Joe Murphy, Broker-Associate

Coldwell Banker Residential Real Estate

941-780-3260

joe@manateemoves.com

www.activerain.com/manateemoves

www.manateemoves.com