Rehoboth Realtor

Investors Take Big Bite Out of Housing Market

noreply@blogger.com (Victoria Kopunek, REALTOR) — Tue, 05 Feb 2013 00:11:00 +0000

Investors Take Big Bite Out of Housing Market

DAILY REAL ESTATE NEWS | MONDAY, FEBRUARY 04, 2013
Hedge funds and private equity firms are looking to cash in on real estate, “rushing in to buy up companies and assets in every part of the housing supply chain, including undeveloped land, homebuilders, foreclosed homes, and building parts manufacturers,” according to a recent CNNMoney article.

"A lot of investors see a short window of opportunity where there's good inventory on the market at bottom market prices," says Brad Geisen, CEO of Foreclosure.com. "No one knows how long it will last, so these investors are trying to buy as much as they can right now."

Last year, the Blackstone Group spent $2.7 billion buying up 17,000 single-family homes in foreclosure to turn into rentals, and they’re continuing to snatch up thousands more homes per month. Pine River Capital Management’s Silver Bay Realty Trust went public in December and, so far, has purchased more than 2,500 homes in once hard-hit housing markets to turn into rentals. It plans to buy 3,100 more homes, according to its recent SEC filing.

Hedge fund manager John Paulson is betting on big growth in home building and focusing on buying up undeveloped land in areas like California, Nevada, and Arizona, which were among the hardest hit in the housing crisis. Reportedly, Paulson & Co. have accumulated enough land in these states alone to build up to 25,000 homes.

Also showing investors interest in housing: Stocks reflecting the housing market are soaring. Publicly traded homebuilder stocks like PulteGroup, KB Home, and Lennar have been trading near 52-week highs. Tri Pointe Homes, a single-family home builder in California and Colorado, raised $232 million for an IPO last week—the first homebuilder IPO since 2004.

Source: “Big Money Betting Big on Housing,” CNNMoney (Feb. 4, 2013)

Frugal Tips for Making a Home More Appealing

noreply@blogger.com (Victoria Kopunek, REALTOR) — Thu, 15 Jul 2010 18:52:00 +0000

Homeowners who want to sell but don’t have a lot of cash to spruce up their properties might consider these tips from Bankrate.com for upgrading a property without spending a fortune.

Polish up the kitchen. Add new cabinet door handles, replace lighting and update the faucet set. Unless the cabinets are mica, give them a fresh coat of paint. Order new doors for kitchen appliances.

Tidy up the bath. Replace the toilet seat. Clean up the floor with vinyl tiles or sheet vinyl applied over the old floor. Re-grout the tub and, if the tub is dingy, add a new prefabricated tub and shower surround.

Paint the walls.

Add closet systems to all the bedrooms, pantry, and entry closets.

Hire a plumber and an electrician to fix anything that is loose or that leaks.

Clean the carpets or, if they are worn, cover them with area rugs.

Replace ceiling lights with inexpensive but attractive fixtures.

Refinish or repaint the front door and replace the hardware.

Mow the lawn, edge the sidewalks, mulch all the beds and put two big planters at either side of the front door.

Source: Bankrate.com (07/14/2010)

What Causes Borrowers to Walk Away?

noreply@blogger.com (Victoria Kopunek, REALTOR) — Fri, 09 Jul 2010 17:52:00 +0000

While borrowers with “super prime” credit scores accounted for just 5 percent of the mortgage delinquencies, about 28 percent of their defaults were calculated and strategic.

This relatively small actual number is nevertheless causing the credit industry to look at new ways to evaluate walk-away risk even among the very creditworthy.

Credit bureau Experian reports that borrowers in California, Florida, and other hard-hit states are more likely to walk away than people living in states with more stable markets. Also, residents of states where lenders have no recourse are more likely to toss in the towel.

People with small amounts of negative equity also are more likely to stay and pay.

Source: Washington Post (07/03/2010)

Dealing With IRS Tax Credit Rejections

noreply@blogger.com (Victoria Kopunek, REALTOR) — Thu, 17 Jun 2010 18:03:00 +0000

The IRS has been rejecting first-time home buyer claims from anyone who shows a Form 1098 Mortgage Interest Expense in their prior year files. In many cases, the applicants are entitled to the credit because their previous mortgage interest deduction is for a timeshare, mobile home, boat, or other recreational property. If you have a client who is in this unfortunate position, here is some advice from Enrolled Agent Eva Rosenberg, who authors the Web site TaxMama.com. • Respond to the IRS immediately and tell them why their rejection is wrong. Be prepared to prove that the mortgage the IRS is seeing isn’t on a personal residence. First-time home buyers are entitled to own other types of real estate and still get the home buyers credit, so provide proof that the previous mortgage was on something else. • Send a letter explaining the situation and providing proof of a previous rental or other non-ownership living situation, including copies of rental contracts for the last three years, an old driver's license showing that address, utility bills, etc. • Home buyers who believe the IRS may view their situation in this way should be proactive, providing proof that they are a first-time buyer when they initially file for the credit. • Anyone who is rejected after two attempts to explain the problem to the IRS should call the Taxpayers Advocate Service toll-free, (877) 777-4778, their Congressman, and their Senator, Rosenberg advises.
Source: TaxMama.com, Eva Rosenberg, EA (06/16/2010)

Fiserv Study Says Markets Are Improving

noreply@blogger.com (Victoria Kopunek, REALTOR) — Tue, 15 Jun 2010 18:26:00 +0000

Fiserv on Monday released a report that analyzed housing financial data from fourth quarter 2009, which seemed to suggest real estate could be improving. “Optimism that a sustainable economic recovery is underway and is driving increases in home prices across many U.S. metro areas. More and more, consumers have confidence that buying a home doesn’t mean catching a falling knife,” says David Stiff, chief economist for global financial technology firm Fiserv. Among the conclusions of the report were:

California markets collapsed about one year before much of the rest of the U.S., creating increased affordability. Year-over-year prices are up in eight of 28 California metro areas and prices have increased from recent lows in 24 of 28 metro areas. The strongest rebounds were in coastal markets, including the Bay Area, Los Angeles, Orange County, and San Diego, where there are decreasing levels of foreclosed homes. Markets in the interior have also experienced a price bounce, mainly due to strong investor demand.
In Washington, D.C., home prices were up 5.2 percent year-over-year. Since the market bottomed in early 2009, prices in this metro area have risen more than 9 percent. Washington boasts a relatively strong local economy with 6.8 percent unemployment compared to 9.9 percent for the U.S. The earlier rapid decline in prices also substantially improved affordability.
Ohio and Michigan, two states hit hard by the recession and loss of manufacturing jobs, are seeing signs of stabilization. Housing is very affordable across metro areas in these states. There is less uncertainty about the future of the U.S. auto industry and jobs in auto and auto parts manufacturing have been increasing since December 2009.
Other markets where investor purchases of foreclosed homes have dominated housing sales are also coming back into balance. This includes metro areas such as Minneapolis, Detroit, and Memphis, where recent sales have included more regular, non-distressed homes.

Source: Fiserv (06/14/2010)

Chinese Status Symbol: A Hong Kong Home

noreply@blogger.com (Victoria Kopunek, REALTOR) — Wed, 19 May 2010 20:55:00 +0000

For many wealthy Chinese, the ultimate travel souvenir is a vacation home, especially a vacation home in Hong Kong. According to one of Hong Kong’s largest real estate companies, Centaline, Chinese buyers represented 18 percent of all real estate purchases in Hong Kong in 2009. Other estimates say the Chinese are responsible for 40 percent of all Hong Kong purchases of property over $1.13 million. Benedict Ma, associate director of research at CB Richard Ellis, says buying Hong Kong property is a status symbol. “You buy an apartment, go back, and tell your friends all about it. If you can afford a place in Hong Kong, you are saying you have arrived.” Ma says many Chinese are also interested in buying U.S. properties, but strict visa policies restrict Chinese visitors to the U.S.

Source: Newsweek International, Alexandra A. Seno

The 'Cher House' Sold in Miami

noreply@blogger.com (Victoria Kopunek, REALTOR) — Fri, 07 May 2010 20:59:00 +0000

ONE Sotheby’s Realty in Miami closed this week on the resale of a mansion sold by singer Cher in 2006 to Sean Wolfington. The recent sale brought $10.45 million, about $2 million more than Wolfington paid.

"There's a shortage of trophy properties on the market and we are seeing an increasing number of wealthy foreign buyers from Latin America and Europe looking to capitalize on the weak U.S. dollar," says Daniel De La Vega, broker of ONE Sotheby's Realty.

Associate Jorge Uribe, who listed the property, says, "A lot of people told me to lower the price by 20 percent to 30 percent because everything was down, but I advised my client to be patient. In the end, the new owners paid a great price for one of the most unique properties in Miami.”

Source: ONE Sotheby’s Realty (05/06/2010)

How Much Will Home Owners Insurance Cost?

noreply@blogger.com (Victoria Kopunek, REALTOR) — Tue, 27 Apr 2010 20:15:00 +0000

The price of insuring a property can raise the cost of ownership significantly. There are various factors that affect the cost of insuring a home: · Location. A home near a fire hydrant or protected by a professional fire department, as opposed to volunteers, will cost less to insure. · History of claims. Previous claims push up the cost of insurance. Ask the seller to provide a home’s insurance claims history report. This information is available from the sources: The CLUE report is $19.50 and can be purchased at: http://tinyurl.com/26m57uo. The A-Plus report is $9 by mail and $13 by fax and available at: http://tinyurl.com/293slq7. · Need flood or earthquake insurance? Policies for both of these perils are sold separately and can be pricey. · How old are the systems? Electrical and plumbing systems that are less than 10 years old cost less to insure.
Source: Associated Press (04/23/2010)

Credit Issues Slowing Recovery

noreply@blogger.com (Victoria Kopunek, REALTOR) — Tue, 06 Apr 2010 19:13:00 +0000

A survey of 200 real estate executives by Akerman & Co, a national commercial real estate company, reveals they believe credit issues and the volume of distressed properties continue to inhibit the recovery of the real estate market. The report found that:

79 percent of respondents said availability of credit and other financing challenges was the most pressing issue facing the industry.
65 percent believe that large inventories of lender-owned properties are preventing a recovery in the commercial real estate industry.
44 percent said inventories of distressed properties and their effect on pricing was the second most pressing issue.
54 percent believe residential is the real estate sector best positioned for a recovery.
20 percent said the industrial sector is best positioned.

Source: Akerman Senterfitt (04/05/2010)

No Authoritative Estimate of Total Foreclosures

noreply@blogger.com (Victoria Kopunek, REALTOR) — Mon, 22 Mar 2010 21:05:00 +0000

How many foreclosed homes are really out there? No one can say for sure, but the number seems to be somewhere between 500,000 and 1 million. To date, no one has been able to track the total number of properties owned by banks, the U.S. Department of Housing and Urban Development, and mortgage investors. Here are a few approximations: • Barclays Capital uses foreclosure data from mortgage securities to estimate that there are slightly more than 600,000 homes in the process of foreclosure. • RealtyTrac, which examines public records, estimates the number is closer to 700,000. • Independent housing economist Tom Lawler combines data from Fannie Mae, Freddie Mac, the Federal Housing Administration, Federal Deposit Insurance Corp., and securitization trusts to conclude that there are actually about 500,000. Source: The Wall Street Journal, James R. Hagerty (03/19/2010)

Sam Zell: Recovery Is Underway

noreply@blogger.com (Victoria Kopunek, REALTOR) — Fri, 19 Mar 2010 18:10:00 +0000

Sam Zell, the billionaire investor who made his fortune in real estate, told

Bloomberg News

yesterday that he expects the U.S. housing market to start recovering at the end of 2010 and strengthen in the middle of 2011.

Zell, who according to the Forbes’ tally is the 237^th richest person in the world, said, “Conditions are getting better, but there’s a lot of uncertainty. The real question is: Can confidence return enough so that what you call the green shoots can continue forward?”

Zell said he expects more turmoil in the commercial real estate business, pointing toward General Growth Properties Inc., the mall owner that is fighting a takeover, as an example.

Source: Bloomberg, Rita Nazareth (03/16/2010)

What Will the Market's New Normal Be?

noreply@blogger.com (Victoria Kopunek, REALTOR) — Wed, 03 Feb 2010 20:43:00 +0000

In a new study, "Housing in America: The Next Decade," Urban Land Institute senior resident fellow John McIlwain says the housing market will not return to what it was prior to the downturn but rather that a "new normal" will take its place.

He expects another 10 percent decrease in residential prices this year, a jump in the number of borrowers abandoning "underwater" mortgages, and a change in consumer perceptions of homeownership.

"The emotional impact on the children and parents and disillusion about the 'joys' of homeownership will be intense; new attitudes to homeownership and the American dream will emerge," McIlwain writes.

He expects home price appreciation to hover around 1 percent or 2 percent per year after the market recovers and the national homeownership rate to drop from 67 percent currently to 62 percent by 2020.

In the coming decade, McIlwain expects the following:

Older baby boomers to move to urban, mixed-use, mixed-age centers near family instead of retiring to Sun Belt communities;
Immigrants to snub the suburbs in favor of more close-knit communities;
Younger boomers to face the challenges of lost home equity and a smaller pool of move-up buyers;
Generation Y to rent for long periods by choice or because they are paying off student loans or have stagnant incomes.

Source: Inman News (02/01/10)

6 Surprising Facts About the Buyer Tax Credit

noreply@blogger.com (Victoria Kopunek, REALTOR) — Fri, 22 Jan 2010 21:38:00 +0000

The homebuyer tax credit is not as simple or straightforward as you might think. Here are some nuances that will affect homebuyers who plan to use it.

To qualify for the move-up tax credit, a home owner must have occupied the same principal residence for five of the last eight years consecutively.
Buyers can elect to claim the credit on either their 2009 or their 2010 tax return, whichever is best for them.
Buyers who claim the credit in 2009 can’t file electronically because the Internal Revenue Service hasn’t put the required forms on line. The wait for a refund is three or four months.
The home can be a mobile home or travel trailer that is fixed to land owned or leased by the home owner. A mobile home or travel trailer that is actually mobile doesn’t qualify.
The home can’t be purchased from a close relative, including a parent, spouse, child, grandparent or grandchild.
A buyer who earns no taxable income or doesn’t owe any federal income tax can qualify for the tax credit and file a tax return just to claim it.

Source: Bankrate.com, Marcie Geffner (01/21/2010)

Are Fixed-Rate Mortgages the Best Loan?

noreply@blogger.com (Victoria Kopunek, REALTOR) — Tue, 15 Dec 2009 19:56:00 +0000

The think-tank Center for American Progress is questioning the premise that a 30-year, fixed-rate mortgage is the best option for homebuyers.

The reason mortgage-backed securities looked so attractive to banks is that they solved the problem of a mismatch between low rates on mortgages and higher rates for deposits. Banks worried about getting stuck earning low rates on a mortgage for 30 years while having to pay higher rates on bank accounts to attract depositors. Their answer: unload their mortgages to investors and let them worry about the profitability of the loans. Those investors hedged their bets by purchasing interest-rate swaps and other derivatives. Now, even Fannie Mae and Freddie Mac are having a hard time getting a handle on what those hedges are worth.

In other parts of the world, variable rates are the norm. While borrowers face the risk of rates going up, lenders at least can ensure the rates they pay to depositors don't outstrip what they receive in mortgage products. Homeownership rates in Canada and the European Union, where variable rate mortgages are the norm, are about what they are in the U.S.

And in any case, there are ways for borrowers to mitigate their interest-rate risk. They can take out loans with fixed initial period, for example. For homeowners who typically hold their homes for seven years, a five-year fixed rate provides considerable security.

If the country persists in choosing fixed-rate mortgages, some observers say, lenders might consider the Danish model where mortgages are financed through the bond market rather than a separate securities market. That's a system that has worked well for two centuries.

Source: The Wall Street Journal, James R. Hagerty (12/14/2009)

HUD Considers Tightening FHA Requirements

noreply@blogger.com (Victoria Kopunek, REALTOR) — Thu, 03 Dec 2009 21:00:00 +0000

U.S. Housing and Urban Development Secretary Shaun Donovan on Wednesday asked Congress for authority to raise borrower premiums and down payments in order to bring the Federal Housing Administration’s reserves above the mandated 2 percent minimum.

The agency plans to reduce the maximum permissible seller concessions from 6 percent to 3 percent. The minimum borrower FICO score will be raised above the current 500, although the final number has not yet been determined. It also will likely increase the down payment to 5 percent, but that number hasn’t been decided either.

Donovan also wants lenders to take responsibility for losses associated with loans not underwritten to FHA standards and to be accountable for origination quality and compliance.

Critics said tightening up FHA could slow the housing recovery.

"What would cripple the housing market is the FHA changes its down payment requirement," said Rodney Anderson, a broker with Supreme Lending in Plano, Texas, the top individual originator of FHA loans in the country.

Source: Reuters News, Lucia Mutikani (12/02/2009)

Government Announces Short Sales Guidelines

noreply@blogger.com (Victoria Kopunek, REALTOR) — Wed, 02 Dec 2009 21:11:00 +0000

The U.S. Treasury Department announced new guidelines this week designed to make short sales go more smoothly.
To qualify under these new guidelines:

The property must be the home owner’s principal residence.

The home owner must be delinquent on the mortgage or close to defaulting.

The loan must have been made before Jan. 1, 2009, and be for less than 729,750.

The borrowers’ total monthly mortgage payment must exceed 31 percent of their before-tax income.

Under the plan, borrowers will receive $1,500 from the government for selling homes for less than the amount of their mortgages. Mortgage-servicing companies will get $1,000 for each completed short sale. Second-mortgage holders can receive up to $3,000 of the sales proceeds in exchange for releasing their liens. Investors who hold the first mortgage can collect up to $1,000 from the government for allowing the payments.

Borrowers who complete a short sale under the program must be "fully released" from future liability for the debt, according to the guidelines.

Source: Associated Press, J.W. Elphinstone (11/01/2009) and The Wall Street Journal, Ruth Simon (11/01/2009)

How to Get the Best REO Deal

noreply@blogger.com (Victoria Kopunek, REALTOR) — Tue, 01 Dec 2009 20:30:00 +0000

REO and short-sale properties can be money pits when offers take forever to close and vacant properties are trashed.

Here are some suggestions for expediting the deals:

* The best short-sale deals are those where the bank has pre-approved the sale price. The property may still take a long time to close, but not as long as it would otherwise.
* Buyers of a short-sale should be prepared for multiple offers. If the short-sale property is an attractive one, the lender will continue to market the property even after signing a sales contract. And if it gets a better offer, it may sell the property without giving the original buyers a chance to negotiate.
* Seek out houses protected by the Cash for Keys program, which gives short-sale and foreclosed owners money to prevent them from trashing the place on the way out.
* Inspections are important. If a home has been vacant, get the property re-inspected prior to closing.
* Buyers shouldn't focus on price alone. Homes that are in poor neighborhoods, have serious maintenance issues, or have terrible floor plans aren’t bargains despite the price.

Source: Inman News, Bernice Ross (11/30/2009)

Market Should Be 'Near Normal' in the Spring

noreply@blogger.com (Victoria Kopunek, REALTOR) — Thu, 19 Nov 2009 22:10:00 +0000

Housing industry consultant John Burns says low mortgage
rates and the home buyer tax credit, plus the availability of FHA loans – “the new subprime,” as he calls it – will
combine to keep housing transaction levels at “near normal” through Spring 2010.

First-time homebuyers are about the half the market, he says, while the expansion of the housing tax credit will get
senior buyers “off the fence” and buying retirement properties.

What would have happened if Congress hadn’t extended the tax credit? “I think we would see housing crater,” Burns said.

Burns clients include home builders, lenders, and equity invrstors.

Source: the Wall Street Journal, Nick Timiraos (11/18/2009)

Foreclosures Decline for Third Month

noreply@blogger.com (Victoria Kopunek, REALTOR) — Thu, 12 Nov 2009 22:54:00 +0000

Foreclosures were filed on 332,292 U.S. properties in October, a decrease of 3 percent from September, but still up nearly 19 percent from October 2008, according to foreclosure sales site RealtyTrac.

October marks the third-straight month of declines in foreclosures, which many see as an encouraging sign that the worst of the foreclosures are behind us. Still, some skeptics predict another wave. “The real issue is we don’t know what inventory banks are holding that they have yet to put on the market,” said Stephen Miller, chair of the economics department at the University of Nevada at Las Vegas, during an interview with Bloomberg News.

States with the highest foreclosure rates are Nevada, California, Florida, Arizona, Idaho, Illinois, Michigan, Georgia, Maryland and Utah.

Four states accounted for 52 percent of the nation’s total foreclosure activity in October: California, Florida, Illinois, and Michigan. The rest of the states in the top 10 for actual numbers of foreclosures were Nevada, Arizona, Georgia, Texas, Ohio, and New Jersey.

Source: RealtyTrac (11/12/2009)

Fewer Short Sales Come Up Short

noreply@blogger.com (Victoria Kopunek, REALTOR) — Wed, 21 Oct 2009 21:25:00 +0000

While obstacles to short sales remain, real estate practitioners say the process is becoming more efficient. Rather than waiting six months or more to push through a deal, agents say banks are more willing to negotiate prices up front.

"My gut feeling is that short sales seem to be the preferred avenue for distressed property now," says Cindi Hagley of San Ramon, Calif.-based Windermere Welcome Home. "It's cheaper for [banks] to do a short sale than go all the way to foreclosure."

The short-sale process has become more manageable now that banks are willing to pre-approve prices, reach out to underwater borrowers who have listed their homes for sale, implement Web-based systems that manage the short sale process, and add staff dedicated to short sales.

Additionally, the U.S. Treasury is set to implement a streamlined short sales framework and offer incentive payments of $1,500 to home owners and $1,000 to both loan servicers and second-lien holders.

Borrowers also prefer short sales because Fannie Mae requires them to wait only two years to own another home or even less than that if they were not delinquent. By contrast, those who lost their homes to foreclosure have to wait five years.

Source: San Francisco Chronicle, Carolyn Said (10/21/09)

A Historic Time to Buy

noreply@blogger.com (Victoria Kopunek, REALTOR) — Tue, 06 Oct 2009 20:44:00 +0000

Young people just starting to invest and buying their first homes are potentially the winners in this recession.
First-time homebuyers, most between the ages of 25 and 45, accounted for about 45 percent of home sales from January through July 2009, according to the National Association of REALTORS®
"This is a historic time," says George Jaramillo, a 35-year-old business analyst in Atlanta, who recently bought three homes, two of them foreclosures. "It's a great opportunity to make some great gains in the future."
A study by investment company T. Rowe Price points out that investing when prices are low can result in amazing gains. For instance, between 1970 and 1990, the annualized rate of return for the S&P 500 was 11.5 percent.
"We need to be shouting from the rooftops that this is not the time to get out of the market if you're young," says Christine Fahlund, a senior financial planner with T. Rowe Price. "This is the time to be in the market."
Source: The Associated Press, Chip Cutter (10/05/2009)

Manhattan Prices Fall Year-Over-Year

noreply@blogger.com (Victoria Kopunek, REALTOR) — Mon, 05 Oct 2009 20:31:00 +0000

It is unclear what direction Manhattan real estate prices have moved in during the past three months, but there is no argument that they have fallen significantly in the last year.

Miller Samuel says prices have declined 8.4 percent year-over-year. Halstead Properties and Brown Harris Stevens reported a 14 percent decline. Corcoran Group reported an 18 percent decrease.

"The interesting thing about this was that lower prices drove people back into the market," says Pam Liebman, CEO of Corcoran.

Bill Staniford, CEO of PropertyShark.com, says, "There's still plenty of money sitting on the sidelines … The biggest problem is obtaining financing."

Jonathan Miller of Miller Samuel echoes that. "Underwriting requirements are the most stringent I've ever seen," he says.

Source: CNNMoney.com, Les Christie (10/02/2009)

Which Cities Will See Biggest Rebound?

noreply@blogger.com (Victoria Kopunek, REALTOR) — Fri, 02 Oct 2009 20:58:00 +0000

Which cities are likely to be the hottest post-economic downturn destinations for young, brilliant, and highly mobile workers?
The Wall Street Journal surveyed six trend-spotting experts and they chose cities based on economic diversity, lifestyle and their own personal prejudices.
Here’s the top-10 list:
1. Washington, D.C. (tie)
1. Seattle
2. New York
3. Portland, Ore.
4. Austin, Texas
5. San Jose, Calif.
6. Denver
7. Durham, N.C.
8. Dallas
9. Chicago
10. Boston
Source: The Wall Street Journal, Sue Shellenbarger (09/30/2009)

Buying a Foreclosure Is No Picnic

noreply@blogger.com (Victoria Kopunek, REALTOR) — Mon, 28 Sep 2009 20:30:00 +0000

Buyers seeking a foreclosed property should realize that not every foreclosure is a good deal.

Urge would-be buyers of foreclosures to have the property thoroughly inspected, says Dan Steward, president of the Tampa-based inspection firm, Pillar to Post. Lenders are not held to the same disclosure requirements as sellers.

Steward says damage isn’t always obvious. While it doesn’t take an expert to see that a toilet has been ripped out, it does require someone with knowledge to know that ripping it out damaged a pipe 20 feet down the line.

The best way for the buyer to get the property is to follow the bank’s instructions closely, says Ryan Melvin, co-owner of More Realty Group in Las Vegas, which specializes in foreclosures.

Another quirk that sometimes surprises buyers of real-estate-owned properties, or REOs, is the scrutiny that banks place on the buyers' credit, even though they are using a different lender.

Source: The Wall Street Journal, Amy Hoak (09/27/2009)

Signaling Confidence, Fed Holds Rates Steady

noreply@blogger.com (Victoria Kopunek, REALTOR) — Thu, 24 Sep 2009 19:53:00 +0000

In an announcement that should bolster the housing industry, the Federal Reserve said Wednesday that it intended to keep key lending rates near zero "for an extended period" and continue to buy mortgage-backed securities and debt through March 2010.

That’s the second time the Fed has decided to stretch out its program to encourage spending and stimulate the economy.

Economists predict that the Fed will keep the key lending rate near zero into the first quarter of next year. Holding that rate low means that consumer loans, including mortgages, home-equity loans, and credit-card rates, remain at the lowest point in decades.

Greg McBride, senior financial analyst at Bankrate.com, warned that these low rates will eventually head higher and said home owners interested in refinancing should realize that "it could be a different story 12 months from now," with much higher rates for 30-year fixed-rate mortgages.

Source: The Associated Press, Jeannine Aversa (09/23/2009)