May 2nd, 2012
Short Sales:
Great news for your clients interested in short sale properties: the government is attempting to make the loan approval process more efficient.
The Federal Housing Finance Agency has issued a new directive that requires reviewers of Fannie and Freddie loan approvals to respond to borrower requests for short sales within 30 days after receipt of the offer. If the review process is still dragging out after 30 days, the borrower is entitled to weekly status updates.
Finally, a borrower must have a final decision from the reviewers within 60 days after receipt of the short sale offer.
Principal Residence Exemption:
Earlier this year, the REWeekly reported on the likely adoption of the Principle Residence Exemption (PRE) legislation being considered by Michigan legislators.
As you may recall, in order to qualify for a significant tax reduction on a home purchase, new homebuyers had to file for their PRE by the May 1st deadline. This was problematic because many would-be homebuyers would not qualify for a mortgage without significant property tax reduction available under the PRE.
For some time now, the home lending industry had been reporting that the May 1 filing deadline was preventing many first-time and repeat buyers from getting mortgage loans and, therefore, completing home purchases.
This past week the Michigan House of Representatives voted 109-1 in support of the legislation to waive the May 1st deadline. The bill then headed to the Governor, where it was signed yesterday.
As part of this legislation, Senate Bill 349 creates two PRE filing dates; one on June 1st and the other on November 1st.
The legislation is also good news for buyers interested in foreclosures. The bill allows them to retain their PRE and qualify for the lower tax rate.
Tags: Coldwell Banker Weir Manuel, government, homestead properties, House of Representatives, Michigan, real estate
Posted in Coldwell Banker Weir Manuel, Government programs, Michigan Legislature, Michigan Real Estate Market, buy a home, coldwell banker, homestead properties | Comments Off
April 26th, 2012
By Donna Levos, Coldwell Banker Weir Manuel
Our clients often ask us: Are we in a buyers’ or sellers’ market? Sometimes it is clearly one or the other. But other markets are harder to call. Ultimately, inventory (or lack thereof) plays a large role in determining whether the market favors buyers or sellers.
Understanding the inventory:
Inventory is the supply of residential homes and condominiums for sale on the market.
For the current 12 month period, there were 26,317 homes for sale in our local markets (Metro Detroit) as opposed to 32,317 listed the previous 12 months. So inventory is down about 19%.
Other factors consider:
Sales figures also impact the market landscape. The total number of sales for the current 12 months (both bank-owned and traditional) is up 2,879 units from the previous 12 months, or roughly 5%.
Of these sales, traditional home sales are up 18%.
So what does this mean to our clients? At first glance, one might think that these figures favor sellers.
But consider that currently there is a 4.9 month’s supply of homes on the market. This is a normal, balanced market which is good for both sellers and buyers. Of this supply, approximately __% is bank-owned properties.
Taking it a step further, if we look specifically at bank-owned properties, we have a 3.9 month supply.
In such times, it is best to remind sellers to price their homes at or slightly above market value.
Whom does the market favor?
The Southeastern Michigan housing market has stabilized, and both buyers and sellers can claim the market as their own.
For more city-specific information, you can provide your clients with an inventory report found in a link featured in every RE Weekly.
After all, It is up to us to educate the consumer that what is happening nationally (not necessarily what’s being reported in the national media) is not what they will experience in our market. All real estate is local.
One final thought: these numbers may eventually be influenced by the release of the much-discussed “shadow inventory” of REO homes, that may or may not be released within the year. Shadow inventory is the term used to describe the “Pending Supply” of distressed properties not currently listed on multiple listing services (MLSs) that are seriously delinquent, in foreclosure, or those that are bank-owned.
Tags: buyers, foreclosures, inventory, Michigan, real estate, sales, sellers, shadow inventory
Posted in Coldwell Banker Weir Manuel, Condos, Short Sales and Foreclosures, buy a home, homes for sale, housing, inventory, real estate, real estate market, sell a home | Comments Off
April 9th, 2012
By Donna Levos, Coldwell Banker Weir Manuel
Selling: How is inventory moving?
Sellers always ask us: how quickly can I expect to sell my home?
While we can do a market analysis that will tell us roughly what a property can list for, the time it will spend on the market is harder to gauge.
According to RealComp, the average number of days on our local market is 71. But our CBWM listings in Oakland County for example, are averaging just 67 days.
And the spring market is heating up nationally too, according to NAR’s Chief Economist Lawrence Yun:
“If activity is sustained near present levels, existing-home sales will see their best performance in five years. Based on all of the factors in the current market, that’s what we’re expecting with sales rising 7 to 10 percent in 2012.”
The national average for days on the market is 32. The good news is homes are selling quicker than they were a few years ago.
So why might a home sit on the market longer? Well, we know that pricing it right at the beginning of the listing has a significant influence on how quickly it moves. As real estate practitioners, it is our role to help assist our customers with appropriate pricing.
Buying: What’s for sale?
The flip side of buyers having spring fever is that it clears out inventory quickly.
Lately we find our buyers asking: Where are the good houses? By “good” we assume they mean move-in ready homes. The fact is there are a lot of foreclosures on the market (some of them in rough shape) and lots of short sales too (which take longer to close). In summary, local inventory has been very low this past year.
The key here is patience. More than likely, the coming months will bring more homes to the market. The improvements in the market should prove reassuring to sellers who have been reluctant to list their homes.
Remind your customers that as their trusted advisor with access to the latest information, you are able to quickly identify new listings as they are coming onto the market and sometimes even provide advance market intelligence.
Tags: Buying, housing, real estate, selling, Spring
Posted in Coldwell Banker Weir Manuel, Oakland County, buy a home, coldwell banker, families, homes for sale, housing, inventory, real estate, real estate market, sell a home, spring market | Comments Off
March 21st, 2012
By Donna Levos, Coldwell Banker Weir Manuel
Whether it be clothing, food or music, being able to shop from a phone or laptop is so convenient. And presently, many of our customers are also shopping for homes online.
The NAR 2011 Profile of Buyers and Sellers reported that 88% of buyers utilize the internet in their home search. This number was even higher at 96% for people 25-44.
So chances are your customers are coming to you with a list of homes they want to see from a home search website. And while it’s great to have a proactive customer who is informed about pricing and inventory in their local market, this practice can sometimes lead to consumer frustration because online data is not always accurate.
What Agents need to communicate to their clients:
Looking online early in the home buying process is a normal part of real estate these days. The internet is a great place for clients to get a feel for what’s on the market. It can even save you time as a practitioner!
But Realtors need to make sure their clients understand the shortcomings of on-line data. Many sites leave listings posted for months after they are sold. Price changes and even listing broker data can often be outdated.
Only an agent can find the most accurate, timely information on listings in their market. Trusting a real estate professional will save frustration and wasted time chasing down a house that isn’t available.
What Clients should know about searching online:
Whether it’s Zillow.com, Trulia.com, or another site, there is currently no way to control the integrity of the listing data. These types of sites are populated by IDX (Internet Data Exchange System) feeds from local Multiple Listing Systems (MLSs) and other broker feeds. Once the data is sent out, there is no follow-up or guidelines as to how often it is refreshed.
The Coldwell Banker Weir Manuel website is home to our own listings as well as tens of thousands of others. It’s more reliable than the third party sites. But the most accurate source for current data is almost always the local MLS.
Only Realtors have access to this source, which is why consumers should always seek Realtor assistance when getting serious about narrowing their home search.
The Bottom line:
There is nothing more frustrating than spending hours online, falling in love with a house from the photos, and then finding out that it no longer available. So remind your clients that your job is to bring the most accurate information to them, not the other way around.
Tags: home buying, internet, online search, Realtors, search, websites
Posted in Coldwell Banker Weir Manuel, buy a home, coldwell banker, homes for sale, housing, moving, real estate market, real estate technology, sell a home, websites | Comments Off
March 21st, 2012
Show & Tell: Tips for showing a home where kids live
By Donna Levos, Coldwell Banker Weir Manuel
Showing a home can create stress for any client, but even more so for those with small children. Sellers with kids do the best they can to keep up with the spilled Cheerios, scattered toys and sticky handprints. Help them out by sharing these tips for before and after you list the home:
De-Clutter and Donate:
The most important thing to do before listing a home is de-clutter. This is especially true for those with children whose toys and baby gear have taken over the house. Suggest that your clients remove excess toys and out-of-season clothing from kids’ closets and bedrooms. Store or donate these items. This will help maximize bedroom space and get a jump start on packing.
Bunk Up:
Suggest that children temporarily share a bathroom and/or bedroom to save time on tidying up and cleaning before a showing. If the home is large and has several bathrooms, it may make sense to have an “off limits” bathroom that won’t need to be cleaned in advance.
Once the showings begin, here are a few thoughts to help things go smoothly:
Making a Getaway:
For a busy family with children, it may be reasonable to have a 24 hour notice policy on showings. However, suggest that the family have a bag packed with small toys, books and snacks to make a quick getaway if there are any last minute showings.
I Can Help!
Kids are actually a great help when they want to be. Perhaps suggest that your sellers assign pre-showing “chores” to their children such as vacuuming, picking up clutter or emptying wastebaskets.
Secret Stash:
Another great trick is to have laundry baskets throughout the house that are meant to gather loose items quickly. These baskets can be quickly stashed inside of the washing machine, dryer or car. Unlike closets, potential buyers are unlikely to look inside these places.
Above all else, remind your sellers that in general, people understand the fact that children live in the home. Chances are other families with small kids are looking at the home as well. But it is still very important to present a clean and well-maintained home. So using fewer rooms, stashing clutter and having a plan for quick getaways will make showings easier to manage. After all, this next showing might be the one that seals the deal!
Tags: children, families, Homes, kids, moving, real estate, selling, showing, tips
Posted in Coldwell Banker Weir Manuel, buy a home, coldwell banker, families, homes for sale, housing, moving, real estate, sell a home, showing | Comments Off
March 1st, 2012
Michigan population stabilizes
By Donna Levos, Coldwell Banker Weir Manuel
For the first time in six years, Michigan’s outbound and inbound populations have equalized. A recent study by Atlas Van lines, one of the nation’s largest moving companies, reported its findings about 2011 migration patterns:
“Our annual migration patterns study is an interesting gauge of the economy, where economic development is taking place and trends to follow throughout the upcoming year,” said Jack Griffin, president and COO of Atlas World Group, which reviews moving patterns annually. “These new findings are especially promising, as we saw the number of moves increase yet again across North America.”
The study went on to say:
“The Midwest region only has three balanced states – Iowa, South Dakota and Michigan. Despite uncertain economic conditions, Michigan became a balanced state following a six-year streak as an outbound state.”
This migration trend should provide continued stimulus to the local housing market. As a matter of fact, in 2011, our own CBWM relocation services department recently saw a 25% increase in customers who were relocating to Michigan.
Several companies including Carhartt, Sherwin Williams, Lear and Johnson Controls have been actively hiring. This has created buying demand in our local housing market, especially in Oakland, Washtenaw, North Livingston, Wayne and Macomb counties.
These trends signal recovery of our local job and housing markets and confirm that Michigan is among the states that are leading the nation out of the recession.
Posted in Builders, Coldwell Banker Weir Manuel, Macomb County, Michigan Real Estate Market, Oakland County, Washtenaw County, Wayne County, buy a home, coldwell banker, homes for sale, housing, populations, real estate, real estate market, sell a home | Comments Off
March 1st, 2012
Last Year for HAFA Program
By Donna Levos, Coldwell Banker Weir Manuel
First introduced in 2010, the HAFA program is set to expire at the end of this year. As you know, it a government program to help homeowners avoid foreclosure. This is accomplished by allowing the homeowner to sell the home either by short sale or deed in lieu.
From the Home Affordable Modification Program website:
“The Home Affordable Foreclosure Alternatives (HAFA) Program provides additional options to avoid costly foreclosures and offers incentives to borrowers, servicers and investors who utilize a short sale or deed-in-lieu (DIL) to avoid foreclosures. HAFA alternatives are available to all HAMP-eligible borrowers who: 1) do not qualify for a Trial Period Plan; 2) do not successfully complete a Trial Period Plan; 3) miss at least two consecutive payment during a HAMP modification; or, 4) request a short sale or DIL.
In a short sale, the servicer allows the borrower to list and sell the mortgaged property with the understanding that the net proceeds from the sale may be less than the total amount due on the first mortgage. Generally, if the borrower makes a good faith effort to sell the property but is not successful, a servicer may consider a DIL. With a DIL, the borrower voluntarily transfers ownership of the property to the servicer – provided the title is free and clear of mortgages, liens and encumbrances. With either the HAFA short sale or DIL, the servicer may not require a cash contribution or promissory note from the borrower and must forfeit the ability to pursue a deficiency judgment against the borrower. “
Basically, HAFA simplifies and streamlines the short sale and DIL process by providing a standard process flow, minimum performance timeframes and standard documentation. But time is running out. If your clients would like to explore eligibility for HAFA, please contact Nick Wuest at Bankers Home Loan: 248-816-7145.
Posted in Government programs, HAFA, Michigan Real Estate Market, Short Sales and Foreclosures, coldwell banker, housing, real estate, real estate market | Comments Off
February 7th, 2012
By Donna Levos, Coldwell Banker Weir Manuel
Many condominium purchase agreements are now subject to a Homeowner’s Association Certification (HOA) being presented within seven days for the buyer’s review. Both conventional and FHA loans are being affected by this condition. By making sure your seller/buyer has a current condo certification form from the start, you can prevent unpleasant surprises that can come up after the appraisal and just prior to close.
Several factors can affect your buyer’s loan approval when purchasing a condo:
- One entity owning more than 10% of units within the project
- Over 15% in delinquent assessments of total units
- HOA litigation
- Commercial space greater than 20% within the projects
- Insufficient reserves (must be 10% of annual budget)
- Lender liable for 6+ month HOA dues
If any of these factors exist, the transaction will have to be a cash purchase unless the lender is able to have an underwriting exception approved.
Another thing to keep in mind is that if buyers intend to pay cash for the unit and then later flip or re-sell it, they will still want to make sure to get the certification to ensure that it can be re-sold.
Ideally, an HOA Certification should be ordered prior to the property inspection. Contact the association or property manager for instructions on how to order it. Many times you will find that associations have contracted a third party such as Condocerts.com. The cost to get the certification is about $65. Other documents including Master Deed and Bylaws may also be available at additional costs.
If your seller wants to be proactive and if you want to be sure your listing is marketable with mortgage financing it is a good idea to follow the same process.
The following are the three types of certification forms:
- 921 HOA Certification
- High Balance Conforming Certification
- 2 – 4 Unit HOA
Most of the time, you will just need the 921 form. Once it is obtained, it is good for 90 days.
If you are confused or want advice on which form would be the most effective for your transaction, contact the lender. If you have questions about the condo certification process, contact Lisa Pevac at Bankers Home Loan at 248-283-8461.
Tags: Condos, HOA, Michigan, real estate
Posted in Coldwell Banker Weir Manuel, Condos, HOA, Michigan Real Estate Market, buy a home, coldwell banker, homes for sale, housing | Comments Off
Kelly M. Sweeney is the Chief Executive Office of Michigan-based Coldwell Banker Weir Manuel.