Foreclosures, Short Sales Not Dead!

"FORECLOSURE ACTIVITY INCREASES 3 PERCENT IN APRIL TO 18-MONTH HIGH DRIVEN BY RISING BANK REPOSSESSIONS!"

A recent report released by RealtyTrac, the nations leading source for comprehensive housing data,  shows foreclosure filing are up 3 for the previous month and up 9% from a year ago! CLICK HERE TO READ REPORT!

Don't freak out! There are a lot of other indicators involved.

I personally believe this has to do with the auction schedule that was occurring the previous 24 months and banks putting holds on many properties and now following through with the foreclosure process.  As well, many homeowners loans were adjusting the past 24 months, home owners couldn't get used to the adjustment and allowed their homes to get to the foreclosure point.

The interesting thing is a total of 51,773 US properties started the foreclosure process for the first time in April 2015, which is down 3 percent from the previous month and down 5 percent from a year ago.  There are many statistics you can read in the report above.

Nonetheless, short sales and foreclosures are not dead! Banks are still working with people whose loans are adjusting and are just to much to meet the demand of the household finances.  The great thing is consumers have choices now! IF you have equity in your home and have a decent credit score, I can help you get your home refinanced into a better more affordable loan.  If the issue is no equity and loan adjusting to a payment that is too much for the household, banks will still work with you on a short sale and save your credit from a foreclosure.  

Call me today and let's figure it out whatever your situation! 661-702-4767

Santa Clarita New Construction!

If you are planning on selling your home over the next two years, now may be the time to act. Demand is high, supply is low and many homeowners are benefiting from an almost auction atmosphere with several buyers fighting for their house in the current multi-bid environment. Higher prices and less stringent contingencies are making it easier for the seller and their family. However, there may be more (and better) competition about to hit the market in the form of newly constructed homes. This may put an end to the buyers’ frenzy over the limited inventory of existing homes which has been below normal levels for over a year. According to the latest report from the National Association of Realtors(NAR), the forecast for new housing starts and sales will increase significantly over the next two years:

• NAR is forecasting 1.1 million new housing starts in 2015, jumping to 1.4 million in 2016.
• New home sales are projected to increase from the 437,000 in 2014 to 570,000 this year and 720,000 in 2016.

Bottom Line

In major urban areas across the country, building cranes are again stretched across the city skyline. In many suburbs, you can again hear the thumping of a carpenter’s hammer in the background. Those are the sights and sounds that inform us that it may be time to sell. 

If you are considering a move to new construction check out my website for connection to all of the new construction builds in Santa Clarita CLICK HERE

More Consumers Putting Less Money Down To Buy Homes!

A recent post by the National Association of Realtors (NAR) revealed that in the months of December 2014 through February 2015, there was an increase in the number of first-time buyers making a down payment of 6% or less as compared to last year:

• 2014: 61% of first time home buyers
• 2015: 66% of first time home buyers

While the number of small down payments is lower than it was in 2009 when 77% of down payments were 6% or less, it does show the recent decisions by both Fannie Mae and Freddie Mac to offer 3% down payment options to certain buyers is impacting the market. FHFA Director Mel Watt recently explained why Freddie and Fannie made this decision:

“The new lending guidelines by Fannie Mae and Freddie Mac will enable creditworthy borrowers who can afford a mortgage, but lack the resources to pay a substantial down payment plus closing costs, to get a mortgage with 3% down. These underwriting guidelines provide a responsible approach to improving access to credit while ensuring safe and sound lending practices.”

This is great news to millions of purchasers that have been denied the opportunity to own their own home because of the almost impossible burden of saving for a 20% down payment.

Will these programs create future challenges?

Certain pundits fear that low down payment programs will create a wave of foreclosures down the road. Mr. Watt also addressed this concern:

“To mitigate risk, Fannie Mae and Freddie Mac will use their automated underwriting systems, which include compensating factors to evaluate a borrower’s creditworthiness. In addition, the new offerings will also include home ownership counseling, which improves borrower performance. FHFA will monitor the ongoing performance of these loans.”

Also, the Urban Institute revealed data showing what impact substantially lower down payments would have on default rates in today’s mortgage environment. Their study revealed:

“Those who have criticized low-down payment lending as excessively risky should know that if the past is a guide, only a narrow group of borrowers will receive these loans, and the overall impact on default rates is likely to be negligible. This low down payment lending was never more than 3.5 percent of the Fannie Mae book of business, and in recent years, had been even less. If executed carefully, this constitutes a small step forward in opening the credit box—one that safely, but only incrementally, expands the pool of who can qualify for a mortgage.”

Here are the direct links to the guidelines for each program:

Fannie Mae 3% Down Program Freddie Mac 3% Down Program Remember, as with any new program, there will be some confusion. 

If you are considering purchasing a home, please don't hesitate to contact me directly, I will put you in touch with a lender to find the best loan option, with the least amount of down payment you are looking for, 661-702-4767. This market isn't going to last forever!

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Lagging Supply of Homes...Cause of Real Estate Slowdown?

The National Association of Realtors (NAR) recently released the results of their Existing Home Sales Report. Despite the fact that properties are selling faster than they have at any other time since July of 2013, existing home sales declined 3.3% from March. NAR’s Chief Economist Lawrence Yun explained the main reason for the slow:

"April's setback is the result of lagging supply relative to demand and the upward pressure it's putting on prices.”

One major news organization actually used this headline about the decline:

Existing home sales crater in April, falling 3.3%

Well, they certainly haven’t cratered! April marked the second month in a row that the annual sales pace remained above the five million mark (5.04 million) throughout the US. Year-over-year sales have increased for seven consecutive months and are still 6.1% above a year ago. Every month, SentriLock, LLC provides NAR Research with data on the number of homes shown to potential buyers. This data is referred to as ‘Foot Traffic’ and is a great predictor of future sales and buyer demand. In April, buyer demand remained at the same level experienced in March.

So why did sales go down?

Buyers who are ready and willing to make a purchase are entering a market where their dream house may not have been listed yet. They can’t find it! Or if they find it, it happens to catch the eye of other buyers and an auction like environment’ begins.

Housing inventory declined from last year and supply in our market is VERY tight. This is causing bidding wars, faster pace price growth and properties selling at a quicker pace.  It is also causing sellers to overprice their homes and some homes sitting without showings.  

Bottom Line

So how do you make sense of everything that’s going on in the housing market when there are so many conflicting headlines on the same report? John Burns, real estate expert and CEO of John Burns Real Estate Consulting gives this advice:

“The bottom line is this: don't make decisions based on newspaper articles. Read the actual press release, including the methodology, and make sure the results jive with other data points and qualitative feedback you receive.”

If you are one of the many homeowners out there realizing that now may be the time to list your home for sale, or one of the many renters debating a purchase, sitting with a local real estate professional who takes the time to find out what’s really going on in the market, should be your first step! Don't hesitate to contact me today for a free confidential consultation.

Interest Rates 1985 to 2015

Wow! What do you think about this? You could afford more home today then in 1985 considering interest rates are 9% lower! 

Where Are Home Prices Headed?

Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation Survey. Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists about where prices are headed over the next five years. They then average the projections of all 100+ experts into a single number. 

The results of their latest survey

• Home values will appreciate by 4.3% in 2015.
• The cumulative appreciation will be 19.4% by 2019.
• That means the average annual appreciation will be 3.6% over the next 5 years.
• Even the experts making up the most bearish quartile of the survey still are projecting a cumulative appreciation of 11.8% by 2019.

Individual opinions make headlines.