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Wednesday, September 2, 2015

Uptick in REO, Short Sales to Re-Emerge? 9-2-15 9:33AM PDT

The fallout from a fragile economy may send REOs and short sales back on the rise in the coming months, according to a new report released by Clear Capital.
"With stocks plummeting last week and the global economic impact on our domestic economy and housing markets still unknown, distressed sales continue to be a critical market indicator," according to Clear Capital's latest report.
NAR's latest housing report:6 Key Housing Stats to Gauge the Market
Nationally, distressed saturation (the percentage of REOs and short sales to all sales) rose by 0.7 percent in August on a quarterly basis, increasing from 15.4 percent to 16.1 percent. The distressed saturation is near pre-2008 rates, however, a rise into winter could send distressed rates much higher, according to Clear Capital.  
The West and Midwest's distressed saturation rates are higher than the rest of the country, rising by 0.9 percent and 1.2 percent, respectively. The largest increases in distressed saturation have emerged in the South, however, which has seen a 1.5 percent increase from 18.6 percent to 20.1 percent. The Northeast has been the only region to see a drop in distressed saturation from 14.3 percent to 14 percent.
"Distressed saturation continues to be a challenge we face in today's housing market," says Alex Villacorta, vice president of research and analytics at Clear Capital. "In fact, today's 'traditional' housing market continues to be defined by distressed saturation levels. In Act One, at the start of the downturn, distressed properties were an albatross around housing's neck. In Act Two, between 2011 and 2013, investors stepped in, buying, rehabbing, and selling or renting distressed properties, which gave way to higher demand and rising prices. While the overall effect of higher rates of distressed satisfaction in Act Three of the recovery is unknown, one thing is clear; when it comes to housing, REOs and short sales are not a passing fad."
Last week's stock market plunge leaves the economy in a tenuous state, particularly as the summer home buying season wraps up. Clear Capital researchers note that the final part of the year will be a big test on whether the housing recovery will be able to withstand the global volatility.
"If investors pull out, oversupply of distressed inventory could bring us back to Act One," Villacorta says. "Or, a renewed source of distressed inventory could revive demand from investors and traditional home buyers, alike, in an inventory-starved market. The driving factor will be whether traditional consumers will be willing, and more importantly, be able to participate."
Source: "Are REOs Ready for a Comeback?" HousingWire (Sept. 1, 2015)

Tuesday, September 1, 2015

Buying a home: Buyer's guide

1. Start with your credit. Credit reports are kept by the three major credit agencies, Experian, Equifax, and TransUnion. They show whether you are habitually late with payments and whether you have run into serious credit problems in the past.

A credit score is a number calculated from a formula created by Fair Isaac based on the information in your credit report. You have three different credit scores, one for each of your credit reports.
A low credit score may hurt your chances for getting the best interest rate, or getting financing at all. So get a copy of your reports and know your credit scores. Try Fair Isaac's MyFICO.com.
Errors are common. If you find any, contact the agencies directly to correct them, which can take two or three months to resolve. If the report is accurate but shows past problems, be prepared to explain them to a loan officer.
2. Set your budget. Next, you need to determine how much house you can afford. You can start with an online calculator. For a more accurate figure, ask to be pre-approved by a lender, who will look at your income, debt and credit to determine the kind of loan that's in your league.
The rule of thumb is to aim for a home that costs about two-and-a-half times your gross annual salary. If you have significant credit card debt or other financial obligations like alimony or even an expensive hobby, then you may need to set your sights lower.
Another rule of thumb: All your monthly home payments should not exceed 36% of your gross monthly income.
The size of your down payment will also determine how much you can afford.
3. Line up cash. You'll need to come up with cash for your down payment and closing costs. Lenders like to see 20% of the home's price as a down payment. If you can put down more than that, the lender may be willing to approve a larger loan. If you have less, you'll need to find loans that can accommodate you.
Various private and public agencies -- including Fannie MaeFreddie Mac, the Federal Housing Administration, and the Department of Veterans Affairs -- provide low down payment mortgages through banks and mortgage companies. If you qualify, it's possible to pay as little as 3% up front.
A warning: With a down payment under 20%, you will probably wind up having to pay for private mortgage insurance, a safety net protecting the bank in case you fail to make payments. PMI adds about 0.5% of the total loan amount to your mortgage payments for the year.
Once you've considered the down payment, make sure you've got enough to cover fees and closing costs. These may include the appraisal fee, loan fees, attorney's fees, inspection fees, and the cost of a title search. They can easily add up to more than $10,000 -- and often run to 5% of the mortgage amount.
If your available cash doesn't cover your needs, you have several options. First-time homebuyers can withdraw up to $10,000 without penalty from an Individual Retirement Account, if you have one, though you must pay taxes on the amount. You can also receive a cash gift of up to $14,000 a year from each of your parents without triggering a gift tax.
Check on whether your employer can help; some big companies will chip in on the down payment or help you get a low-interest loan from selected lenders. You can also tap a 401(k) or similar retirement plan for a loan from yourself.
4. Find an agent: Most sellers list their homes through an agent -- but those agents work for the seller, not you. They're paid based on a percentage, usually 5 to 7% of the purchase price, so their interest will be in getting you to pay more.
You need "exclusive buyer agent." Sometimes buyer agents are paid directly by you, on an hourly or contracted fee. Other times they split the commission that the seller's agent gets upon sale. A buyer's representative has the same access to homes for sale that a seller's agent does, but his or her allegiance is supposed to be only to you.
5. Search for a home. Your first step here is to figure out what city or neighborhood you want to live in. Look for signs of economic vitality: a mixture of young families and older couples, low unemployment and good incomes.
Pay special attention to districts with good schools, even if you don't have school-age children. When it comes time to sell, you'll find that a strong school system is a major advantage in helping your home retain or gain value.
Try also to get an idea about the real estate market in the area. For example, if homes are selling close to or even above the asking price, that shows the area is desirable. If you have the flexibility, consider doing your house hunt in the off-season -- meaning, generally, the colder months of the year. You'll have less competition and sellers may be more willing to negotiate.
Be wary of choosing search criteria that are too restrictive. For example, select a price range 10% above and 10% below your true range. Add a 10-mile cushion to the location you specify.
6. Make an offer. Once you find the house you want, move quickly to make your bid. If you're working with a buyer's broker, then get advice from him or her on an initial offer. If you're working with a seller's agent, devise the strategy yourself.
Try to line up data on at least three houses that have sold recently in the neighborhood. If you really want the house, don't lowball. The seller may give up in disgust. Remember, that your leverage depends on the pace of the market. In a slow market, you've got muscle; in a hot market, you may have none at all.
There's no foolproof system for negotiating a fair price. Occasionally it's best to deal directly with the seller yourself. More often it's better to work exclusively through intermediaries.
Be creative about finding ways to satisfy the seller's needs. For instance, ask if the seller would throw in kitchen and laundry appliances if you meet his price -- or take them away in exchange for a lower price.
Once you reach a mutually acceptable price, the seller's agent will draw up an offer to purchase that includes an estimated closing date (usually 45 to 60 days from acceptance of the offer).
7. Enter contract. Have your lawyer or buyers agent review this document to make sure the deal is contingent upon:
1. your obtaining a mortgage
2. a home inspection that shows no significant defects
3. a guarantee that you may conduct a walk-through inspection 24 hours before closing.
You also need to make a good-faith deposit -- usually 1% to 10% of the purchase price -- that should be deposited into an escrow account. The seller will receive this money after the deal has closed. If the deal falls through, you will get the money back only if you or the home failed any of the contingency clauses.
8. Secure a loan. Now call your mortgage broker or lender and move quickly to agree on terms, if you have not already done so. This is when you decide whether to go with the fixed rate or adjustable rate mortgage and whether to pay points. Expect to pay $50 to $75 for a credit check at this point, and another $150, on average to $300 for an appraisal of the home. Most other fees will be due at the closing.
If you don't already have one, look into taking out a homeowner's insurance policy, too. Most lenders require that you have homeowner's insurance in place before they'll approve your loan.
9. Get an inspection: In addition to the appraisal that the mortgage lender will make of your home, you should hire your own home inspector. An inspection costs about $300, on average, and up to $1,000 for a big job and takes two hours or more.
Ask to be present during the inspection, because you will learn a lot about your house, including its overall condition, construction materials, wiring, and heating. If the inspector turns up major problems, like a roof that needs to be replaced, then ask your lawyer or agent to discuss it with the seller. You will either want the seller to fix the problem before you move in, or deduct the cost of the repair from the final price. If the seller won't agree to either remedy you may decide to walk away from the deal, which you can do without penalty if you have that contingency written into the contract.
10. Close the deal. About two days before the actual closing, you will receive a final HUD Settlement Statement from your lender that lists all the charges you can expect to pay at closing.
Review it carefully. It will include things like the cost of title insurance that protects you and the lender from any claims someone may make regarding ownership of your property. The cost of title insurance varies greatly from state to state but usually comes in at less than 1% of the home's price.
The lender might also require you to establish an escrow account, which it can tap if you fall behind on your mortgage or property tax payments. Lenders can require deposits of up to two months' worth of payments.
The actual closing is often somewhat anticlimactic. It's a ritual affair, with customs that differ by region. Your lawyer or real estate agent can brief you on the particulars.

Homes sell the fastest in these markets


san francisco street view
If you are a home buyer in San Francisco, you better act fast.

Homes are still selling like crazy in northern California.

In San Francisco, the hottest market in the country, 26% of homes were still for sale in August after being on the market for two months, according to a report from Trulia. The next fastest was Oakland, with 31% of homes still available after two months, followed by San Jose, with 34%.
Tight inventory and rising home prices have created a seller's market where multiple offers and bidding wars are common. "There's nothing to indicate a buyer's market is coming any time soon," said Ralph McLaughlin, a housing economist at Trulia.
But the pace of home sales is starting to slow in some California cities, according to Trulia. For example, the percent of homes in San Francisco, Oakland and San Jose that sell in under two months have decreased slightly from last year.
Meanwhile, home sales in other West Coast markets are picking up. The fourth fastest-selling market was Seattle, with 40% of homes still available after two months, a drop from 44% last year. Homes are also moving faster in Salt Lake City, Utah, which came in fifth place.
On a national level, Trulia found 63% of homes hitting the markets on June 17 were still available on August 17.
Sales in markets that were the most affordable last year have sped up, while the least affordable areas have pumped the brakes, McLaughlin said. "That could be an indicator that affordability may be starting to chip away at the traditional seller's market."
The coming winter could cool things off further, he added. "The hottest and most expensive markets tend to have the biggest drops between summer and winter."
First-time buyers, who have been noticeably absent in the prolonged housing recovery, will have the best luck finding a home in the Midwest, including Detroit and Kansas City, Mo., but also in New Orleans, McLaughlin noted. "Low-tier priced homes [in these markets] move a little slower than the rest of the market and tend to be somewhat affordable as well."

What you need to earn to afford a home in these 27 cities

Buying a home is likely the biggest purchase you’ll ever make, and prices have been on a steady rise across the country. To afford the national median home price of $229,400, you’ll need an annual salary of $51,942.
Here's what you need to earn to afford a home in the 27 biggest metro areas in the country, according to HSH.com.
  • City
  • Salary Needed
  • Median Home Price
  • Monthly payment
  • San Francisco*
    $157,912
    $841,600
    $3,684
  • San Diego*
    $104,839
    $547,800
    $2,446
  • New York City
    $90,750
    $410,400
    $2,117
  • Los Angeles
    $88,315
    $445,200
    $2,060
  • Boston
    $86,164
    $414,600
    $2,010
  • Washington
    $83,027
    $403,800
    $1,937
  • Seattle
    $78,118
    $385,300
    $1,822
  • Denver
    $69,912
    $362,900
    $1,631
  • Portland
    $65,009
    $314,800
    $1,516
  • Miami
    $63,289
    $289,900
    $1,476
  • Sacramento
    $61,517
    $291,000
    $1,435
  • Chicago
    $61,068
    $230,500
    $1,424
  • Baltimore
    $55,842
    $254,500
    $1,303
  • Philadelphia
    $54,385
    $231,700
    $1,269
  • Houston
    $53,684
    $221,100
    $1,252
  • Dallas
    $52,947
    $215,200
    $1,235
  • Minneapolis
    $50,969
    $229,200
    $1,189
  • San Antonio
    $48,092
    $199,400
    $1,122
  • Orlando
    $46,300
    $198,000
    $1,080
  • Phoenix
    $43,170
    $217,900
    $1,007
  • Tampa
    $41,488
    $175,000
    $968
  • Atlanta
    $39,356
    $181,500
    $918
  • Detroit
    $37,544
    $152,850
    $876
  • St Louis
    $36,784
    $157,100
    $858
  • Cincinnati
    $36,357
    $151,900
    $848
  • Pittsburgh
    $33,838
    $145,250
    $789
  • Cleveland
    $33,714
    $129,700
    $786
Source: HSH.com

Denver, CO Homes For Sale-Redfin

 AddressNext Open HousePriceBedsBathsSq. Ft.$/Sq. Ft.On Redfin
12215 Clermont St, Thornton, CO 80241
12215 Clermont St 
Thornton, CO
CHERRY CREEK PROPERTIES INC
-$245,000321,272$1931MapListing provided courtesy of Metrolist, Inc.
9590 E Florida Ave #2028, Denver, CO 80247
9590 E Florida Ave #2028 
Denver, CO
COLDWELL BANKER RESIDENTIAL 54
-$195,000231,224$1591MapListing provided courtesy of Metrolist, Inc.
3852 S Dallas St Unit 8-203, Aurora, CO 80014
3852 S Dallas St Unit 8-203 
Aurora, CO
MB LEDINGHAM & COMPANY
-$167,00011815$2051MapListing provided courtesy of Metrolist, Inc.
3137 Stout St, Denver, CO 80205
3137 Stout St 
Denver, CO
MB ZIMMERMAN & ASSOC
-$560,000432,185$2561MapListing provided courtesy of Metrolist, Inc.
3508 N Adams St, Denver, CO 80205
3508 N Adams St 
Denver, CO
Highland Property
-$199,900331,866$1071MapListing provided courtesy of Metrolist, Inc.
4533 Tennyson St #4, Denver, CO 80212
4533 Tennyson St #4 
Denver, CO
LIV Sotheby's International Realty
-$541,000341,827$2961MapListing provided courtesy of Metrolist, Inc.
3924 Lowell Blvd, Denver, CO 80211
3924 Lowell Blvd 
Denver, CO
Nest Real Estate Group, LLC
-$469,000321,266$3701MapListing provided courtesy of Metrolist, Inc.
8196 E 50th Ave, Denver, CO 80238
8196 E 50th Ave 
Denver, CO
Alisa Poncher
-$625,657333,423$1831MapListing provided courtesy of Metrolist, Inc.
8166 E 50th Ave, Denver, CO 80238
8166 E 50th Ave 
Denver, CO
Alisa Poncher
-$644,619333,297$1961MapListing provided courtesy of Metrolist, Inc.
5555 Washington St, Denver, CO 80216
5555 Washington St 
Denver, CO
BROKERS GUILD-CHERRY CREEK LTD
-$250,0000-1,128$2221MapListing provided courtesy of Metrolist, Inc.
1865 S Williams St, Denver, CO 80210
1865 S Williams St 
Denver, CO
COLDWELL BANKER RESIDENTIAL 24
-$359,900321,190$3021MapListing provided courtesy of Metrolist, Inc.
2464-2480 E 14th Ave, Denver, CO 80206
2464-2480 E 14th Ave 
Denver, CO
Pinnacle Real Estate Advisors
-$1,575,000965,227$3011MapListing provided courtesy of Metrolist, Inc.
720 16th St #412, Denver, CO 80202
720 16th St #412 
Denver, CO
RE/MAX PROFESSIONALS
-$225,00011640$3521MapListing provided courtesy of Metrolist, Inc.
5379 Laredo Ct, Denver, CO 80239
5379 Laredo Ct 
Denver, CO
RE/MAX of Boulder, Inc
-$277,700333,061$911Map
2555 Ames St, Edgewater, CO 80214
2555 Ames St 
Edgewater, CO
BERGEN PEAK REALTY
-$442,200321,334$3311MapListing provided courtesy of Metrolist, Inc.
2375 Monaco Pkwy, Denver, CO 80207
2375 Monaco Pkwy 
Denver, CO
BROKERS GUILD CLASSIC
-$699,950542,952$2371MapListing provided courtesy of Metrolist, Inc.
1732 W 34TH Ave, Denver, CO 80211
1732 W 34TH Ave 
Denver, CO
RE/MAX PROFESSIONALS
-$879,000332,566$3431MapListing provided courtesy of Metrolist, Inc.
1480 Marigold Dr, Denver, CO 80221
1480 Marigold Dr 
Denver, CO
RE/MAX PROFESSIONALS
-$255,000522,000$1281MapListing provided courtesy of Metrolist, Inc.
929 Jersey St, Denver, CO 80220
929 Jersey St 
Denver, CO
RE/MAX Cherry Creek
-$425,000343,096$1371MapListing provided courtesy of Metrolist, Inc.
1201 N Williams St Unit 14B, Denver, CO 80218
1201 N Williams St Unit 14B 
Denver, CO
Kentwood Co at Cherry Creek
-$1,270,000442,544$4991MapListing provided courtesy of Metrolist, Inc.
139 S Trenton St, Denver, CO 80230
139 S Trenton St 
Denver, CO
Cherry Creek Properties LLC
-$173,016331,556$1111MapListing provided courtesy of Metrolist, Inc.
675 S Alton Way Unit 10B, Denver, CO 80247
675 S Alton Way Unit 10B 
Denver, CO
SCHOENECKER & CO
-$175,000221,200$1461MapListing provided courtesy of Metrolist, Inc.
2728 W 26th Ave #104, Denver, CO 80211
2728 W 26th Ave #104 
Denver, CO
KENTWOOD CITY PROPERTIES LLC
-$585,000341,741$3361MapListing provided courtesy of Metrolist, Inc.
888 N Logan St Unit 3F, Denver, CO 80203
888 N Logan St Unit 3F 
Denver, CO
RE/MAX ALLIANCE
-$115,00011608$1891MapListing provided courtesy of Metrolist, Inc.
161 Perry St, Denver, CO 80219
161 Perry St 
Denver, CO
Dream Investment Inc.
-$180,00021992$1811MapListing provided courtesy of Metrolist, Inc.
3590 Magnolia St, Denver, CO 80207
3590 Magnolia St 
Denver, CO
COLORADO TOWNE AND COUNTRY LLC
-$549,900443,993$1381MapListing provided courtesy of Metrolist, Inc.
321 Cragmore St, Denver, CO 80221
321 Cragmore St 
Denver, CO
A&A Realty
-$214,90031984$2181MapListing provided courtesy of Metrolist, Inc.
7542 E 8th Pl, Denver, CO 80230
7542 E 8th Pl 
Denver, CO
Proform, Inc
-$510,000332,582$1981MapListing provided courtesy of Metrolist, Inc.
2562 S Uno Way, Denver, CO 80219
2562 S Uno Way 
Denver, CO
Your Castle Real Estate Inc
-$289,900321,730$1681MapListing provided courtesy of Metrolist, Inc.
5220 W 5th Ave, Lakewood, CO 80226
5220 W 5th Ave 
Lakewood, CO
Pinnacle Real Estate Advisors
-$950,0001896,600$1441MapListing provided courtesy of Metrolist, Inc.
20473 E 40th Pl, Denver, CO 80249
20473 E 40th Pl 
Denver, CO
MB REDSTONE EXECUTIVE RE SERV
-$312,000443,218$971MapListing provided courtesy of Metrolist, Inc.
4833 E 6th Avenue Pkwy, Denver, CO 80220
4833 E 6th Avenue Pkwy 
Denver, CO
RE/MAX Cherry Creek
-$955,000543,525$2711MapListing provided courtesy of Metrolist, Inc.
3132 Umatilla St Unit A, Denver, CO 80211
3132 Umatilla St Unit A 
Denver, CO
Colorado Home Realty
-$290,00011605$4791MapListing provided courtesy of Metrolist, Inc.
19102 E 53rd Ave, Denver, CO 80249
19102 E 53rd Ave 
Denver, CO
SIGNATURE REALTY
-$260,000331,960$1331MapListing provided courtesy of Metrolist, Inc.
2517 S Madison St, Denver, CO 80210
2517 S Madison St 
Denver, CO
THE KENTWOOD COMPANY
-$1,175,000565,271$2232MapListing provided courtesy of Metrolist, Inc.
1969 S Franklin St, Denver, CO 80210
1969 S Franklin St 
Denver, CO
Exit Realty Denver Tech Center
-$310,00031976$3182MapListing provided courtesy of Metrolist, Inc.
8242 Washington St #44, Denver, CO 80229
8242 Washington St #44 
Denver, CO
COLDWELL BANKER RESIDENTIAL 56
-$149,900221,098$1372MapListing provided courtesy of Metrolist, Inc.
3339 Olive St, Denver, CO 80207
3339 Olive St 
Denver, CO
LIV Sotheby's International Realty
-$309,900322,102$1472MapListing provided courtesy of Metrolist, Inc.
4875 S Balsam Way Unit 13-203, Denver, CO 80123
4875 S Balsam Way Unit 13-203 
Denver, CO
YOUR CASTLE SERVICES
-$180,000221,050$1712MapListing provided courtesy of Metrolist, Inc.
6119 Montview Blvd, Denver, CO 80207
6119 Montview Blvd 
Denver, CO
RE/MAX ALLIANCE
-$749,000342,628$2852MapListing provided courtesy of Metrolist, Inc.
1137 Sherman St #23, Denver, CO 80203
1137 Sherman St #23 
Denver, CO
KLOS REAL ESTATE SERVICES
-$109,00011470$2322MapListing provided courtesy of Metrolist, Inc.
7306 E 10th Ave, Denver, CO 80230
7306 E 10th Ave 
Denver, CO
Highland Property
-$568,900342,921$1952MapListing provided courtesy of Metrolist, Inc.
1300 S Eliot St, Denver, CO 80219
1300 S Eliot St 
Denver, CO
MARCELLA GALLO
-$285,000422,244$1272MapListing provided courtesy of Metrolist, Inc.
8138 E 28th Pl, Denver, CO 80238
8138 E 28th Pl 
Denver, CO
TRELORA
-$490,000232,542$1932MapListing provided courtesy of Metrolist, Inc.
2896 S Upham St, Denver, CO 80227
2896 S Upham St 
Denver, CO
RE/MAX Southeast Inc.
-$389,500333,042$1282MapListing provided courtesy of Metrolist, Inc.
19083 E 58th Ave, Denver, CO 80249
19083 E 58th Ave 
Denver, CO
Private Label Realty
-$184,000331,526$1212MapListing provided courtesy of Metrolist, Inc.
1040 Erie St, Denver, CO 80221
1040 Erie St 
Denver, CO
RE/MAX MOMENTUM
-$259,000422,000$1302MapListing provided courtesy of Metrolist, Inc.
2680 S University Blvd Unit 101A, Denver, CO 80210
2680 S University Blvd Unit 101A 
Denver, CO
Workman & Associates
-$510,000332,808$1822MapListing provided courtesy of Metrolist, Inc.
1820 E 16th Ave, Denver, CO 80218
1820 E 16th Ave 
Denver, CO
Coldwell Banker Res-CanyonBlvd
-$275,000--2,137$1292Map
1481 W 71st Pl, Denver, CO 80221
1481 W 71st Pl 
Denver, CO
FCI Real Estate
-$435,0008-3,664$1192Map