Five years after the housing bubble burst, America’s wealthiest families are now losing their homes to foreclosure at a faster rate than the rest of the country — and many of them are doing so voluntarily.

Last year over 36,000 homes valued at $1 million or more were foreclosed on, or at least in default, according to data compiled by RealtyTrac, which tracks foreclosures. While that’s still a low percentage of all foreclosures, it is growing.

Related articles

• Rich Americans: ‘Take My Mansion, Please’ (huffingtonpost.com)
• The Morality of Walking Away from a Home Loan (loans.org)
• Foreclosure Filings Down 19 Percent In One Year (clewismortgage.wordpress.com)

• Typically with a short sale, the homeowner is underwater and has experienced a financial hardship such as a job loss. To limit the damage to his credit rating, a homeowner may attempt to work with his lender to negotiate a short sale. Not only must the bank approve of the short sale itself, it also must agree to the price, since the bank will accept the difference as a loss.
• Unlike foreclosures, in which the owner has walked away and the bank is looking to unload a vacant – and sometimes vandalized – property, a short sale isn’t a distressed home that will sell at an extremely low price. According to data from RealtyTrac, short sales typically sold for nearly 10 percent less than the market price in the first quarter of 2011, whereas foreclosures sold at an average discount of 35 percent.
• Home buyers wanting to purchase a short sale must have patience. In most cases, when a buyer makes an offer on a house, he receives a response from the seller within a few days, or even hours. With a short sale, the bank must approve of the sale and bank representatives are overloaded with cases. It may take 30 days or longer for a buyer to receive a response from the bank.
• In a traditional real estate transaction, it is common for a home buyer who currently owns his home to make his offer contingent on selling his current home. In short sales, most banks will not approve an offer that is contingent on the buyer selling his current home, as too many things can go wrong.
• Banks also typically won’t consider short-sale offers that have inspection contingencies in them, so buyers can either do an inspection prior to making an offer or get no inspections.
• Even with the challenges associated with short sales, buyers don’t have too avoid these transactions. Being prepared ahead of the time and working with an experienced REALTOR® can help buyers avoid frustration and surprises down the line.

Known as “short sales”, the increasingly common transactions for financially troubled homeowners are projected to balloon to 400,000 in 2010.  The number of transactions had exploded to more than 160,000 in 2009 from roughly 96,000 the year before. More than a quarter of the transactions occur in California, with another quarter split between Arizona, Texas and Florida

In an economy in which jobs are scarce and a quarter of homeowners owe more on their property than it’s worth, short sales are appealing to investors, banks and owners as a cheaper way out than foreclosure.

And with fluctuating home prices, lenders can be reluctant to approve short sales. The transactions can be a hassle to execute, especially when multiple loans on a home mean a slew of creditors are included in negotiations.

But on the bright side; Short sales could actually end up boosting the job market. Unemployed homeowners who can escape underwater mortgages have an easier time moving around, expanding their job search.

As I finish this posting, there are currently 604 houses for sale in the Fremont tri-city area. Of which 126 are short sales, that’s 20%.  Those numbers decrease sharply for the higher priced homes. Of the homes prices over $500,000 only 12% are short sales.

When the inspector checks the outside of the house, they will be looking for the following things: drainage conditions, roof, chimney, and more. Inside the house they will examine: doors, windows, plumbing, electrical, appliances, heating system and water heater. They will also crawl under the house and up in the attic as well.

The home inspector will provide a detailed report (about 30 pages) regarding the condition of the home. They might even recommend what steps to take to correct an issue.

A typical home inspection will cost approx $400. And it’s well worth the money, because it can save you thousands of dollars in possible problems.

~ Barry Ripp

In December, the median price of an existing, single-family home rose to $306,820, an 8.4% rise from Dec.’08, the second consecutive year-over-year increase, and the 10^th  straight month-over-month increase, according to C.A.R.’s December sales and price report.

 With affordability near-historic highs, low interest rates, and home buyer tax credits, many properties in California are receiving multiple offers and sparking bidding wars. Home buyers who find themselves in bidding wars should work closely with their REALTOR® to ensure they are crafting realistic offers that are more likely to be accepted by the seller.

Great new for the real estate market. November stats are in and they look impressive. The number of transactions are up almost everywhere you look. That’s partly due to low inventory and new tax credit incentives. 
To give you an idea about the housing inventory; in November 2008, Fremont had 367 active listings; compared to now, Nov.2009 there were 199…that’s 45% less.In the smaller city of Union City, there were 172 listings in 11/08 and now only 51 in 11/09, that’s a 70% reduction. It’s no wonder you’re hearing stories of 10 to 20 offers on the good deals…everyone is looking for one.

What about home sales? Well, Fremont had 67 in Nov.2008 and 92 in Nov.2009. That’s a 37% increase. Union City had only 28 in Nov. 2008 and 40 in Nov. 2009. That’s a 43% increase.

Overall the California median house price rose 5.8% in November. And California home sales increased 4.7%. (compared to a year ago). The median home price in California has risen nine consecutive months in month-to-month comparisons, but November marked the first time California’s median home price has risen in year-to-year comparisons since August 2007.

If you are waiting for the real estate cycle to hit bottom, it’s here now. And, in my opinion, it will stay fairly flat for a year or so before it starts going up again. I’ve seen this market before…it will go up.

 So get ready and start looking to buy your next home…investment or personal use. Don’t get left behind.

 ~ Barry Ripp

www.barryripp.com

Helping buyers and sellers since 1985. I’d love to help you too.

Recent good news about the housing market has many home buyers wondering whether now is a good time to buy. For example, home sales activity increased 9.4 percent nationally in September, a 26 percent increase from a low point in January, according to the National Association of Realtors.

The $8,000 first-time buyer tax credit has stimulated the market, and it has been extended. A credit of up to $6,500 is now available to repeat home buyers who qualify.

Many buyers are having difficulty finding a home to buy. The inventory of good listings on the market is low in many areas because prospective sellers who don’t have to sell now are waiting for a better market. To aggravate the situation, many sellers who need to sell now often take their home off the market after Thanksgiving and will bring it back on the market next year.

Buyers may find there’s very little on the market to choose from for the next several months. However, they may also find that some buyers will drop out of the market over the holiday season, leaving less competition for the listings that are on the market during this period.

 ~ Barry Ripp
Information provided by C.A.R and used with permission.
Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/12/06/REAI1ARGC5.DTL&type=realestate#ixzz0ZnrVz7Rf

Start with your gift giving. Giving an experience, like tickets to a movie or ballgame can create much less waste than toys and gadgets. And some of the best gifts can be homemade like cookies and cakes.

As you do begin wrapping up those presents for family and friends, consider reusing gift bags, tissue paper, and bows.

If you need to ship your presents this year, avoid Styrofoam packing peanuts and try using crumpled up newspaper instead.

As you search for that perfect tree, keep in mind that if you purchase a tree from a tree farm you’re not damaging forests. Artificial trees are also a good choice since they are reused every year and that saves on the gas you would use driving to the tree farms.

If you’re buying lights, be sure to purchase Christmas lights made with light-emitting diodes, or LEDs. These lights have been around a few years and are 90% more efficient than traditional Christmas lights. They also last longer.

And start the New Year off on the right foot try treecycling. By recycling your fresh tree you can make a huge difference in reducing holiday waste. Instead of ending up in a landfill, Christmas trees can be ground into wood chips and be reused as mulch gardens, or to prevent erosion.

And remember….have a very Merry Christmas

Great news for your first-time buyers: The Mortgage Protection Program has been extended through 2010.

To continue to provide first-time home buyers with peace of mind when purchasing their first home, the C.A.R. Housing Affordability Fund has extended the Mortgage Protection Program (MPP) through December 2010. To date, more than 1,700 first-time home buyers already have been approved for the program, and the numbers continue to increase.

On April 2, 2009 the Housing Affordability Fund launched a new program designed to provide peace of mind to first-time buyers who are hesitant to enter the housing market due to concerns about potential job loss, and subsequently being unable to meet their monthly mortgage obligations. Qualifying buyers can receive up to $1,500 a month for up to six months in the event of job loss, a qualified co-buyer can also receive a $750 benefit for up to six months to help pay the mortgage.

TO QUALIFY FOR THE MORTGAGE PROTECTION PROGRAM APPLICANTS MUST:
· Be a first-time home buyer – someone who has not owned property in the last three years
· Open escrow on or after April 2, 2009

· Use a California REALTOR® in the transaction
· Purchase the property in California
· Be a W-2 employee (cannot be self-employed)

This is a great opportunity for first-time homebuyers.Contact me for more information or: Click here for more information, requirements, and a downloadable application.

 ~ Barry Ripp

 Information obtained by the Calif.Assoc.of Realtors.     November  2009

 

 Fannie Mae last week announced a new Deed for Lease™ program. The new program allows borrowers to voluntarily transfer their property back to the lender and then lease back the house at market rate. The lease period is for up to 12 months, with month-to-month contract extensions after that period. The program is designed for borrowers who do not qualify for or have not been able to obtain other loan-workout solutions, such as loan modifications.

 To participate in the program, borrowers must live in the home as their primary residence and must be released from any subordinate liens on the property. Homeowners interested in this lease program must be able to document that the new market rental rate is no more than 31% of their gross montly income.

 Homeowners thinking of participating in the Deed for Lease™ program should visit Fannie Mae’s loan lookup

website at http://loanlookup.fanniemae.com/loanlookup/ to see whether their loan is owned or guaranteed by Fannie. Mortgages backed by the Federal Housing Administration and other government agencies are not eligible for the Deed for Lease ™ program.

 To read the full story, please click here:

http://blogs.wsj.com/developments/2009/11/06/qa-how-to-rent-your-home-from-fannie-mae/

 Reprinted with permission of the Calif. Asso.of Realtors.  Nov. 2009

  ~ Barry Ripp