ESTATE


1 Million Foreclosures This Year
2009/06/02, 6:44 pm
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As of this week, 1 million new foreclosures have been filed in 2009, according to estimates by the Center for Responsible Lending, a nonprofit research and policy organization dedicated to preserving home ownership.

A new foreclosure starts every 13 seconds – nearly 6,500 a day.

“It’s easy to think, ‘Well, that’s tough luck for the families that lose their homes.’ The truth is that foreclosures are costing neighboring families hundreds of billions of dollars and dragging down the entire economy,” says Michael Calhoun, president of CRL.

Calhoun called on lenders and loan servicers to utilize the tools offered by the U.S. government to keep people in their homes.

Source: Center for Responsible Lending (06/01/2009)

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Foreclosures, Short Sales Weigh Down Prices
2009/05/12, 6:50 pm
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The median home price for U.S. metro areas posted a year-over-year decline in the first quarter of 2009, reflecting a high volume of foreclosures and short sales, which typically sell for 20 percent less than traditional homes, the NATIONAL ASSOCIATION OF REALTORS® reports.

The national median existing single-family price was $169,000, which is 13.8 percent below the first quarter of 2008 when conditions were closer to normal. Foreclosures and short sales accounted for nearly half of transactions in the first quarter.

NAR data shows that 134 out of 152 metropolitan statistical areas reported lower median existing single-family home prices in comparison with the first quarter of 2008, while 18 metros had price gains.

NAR President Charles McMillan, a broker with Coldwell Banker Residential Brokerage in Dallas-Fort Worth, said there are two levels of pricing in the current market.

“Traditional homes in good condition have held their value much better, so owners shouldn’t be overly concerned about median prices,” he said. “Most sellers can expect a good return if they’ve been in their home for a normal period of home ownership and haven’t excessively tapped their equity.”

Existing-Home Sales Sluggish

Meanwhile, the sales pace remained slow overall. Total state existing-home sales, including single-family homes and condos, were at a seasonally adjusted annual rate of 4.59 million units in the first quarter, down 3.2 percent from 4.74 million units in the fourth quarter, and 6.8 percent below the 4.93 million-unit pace in the first quarter of 2008.

Seventeen states saw a sales increase from the fourth quarter, and six states were higher than a year ago; complete data for one state was not available. Sales in the first quarter do not reflect an impact from the first-time home buyer tax credit.

Lawrence Yun, NAR chief economist, sees the market in a lull before an upturn. “Over the past couple months, contract activity for home sales, buyer traffic and inquiries about the $8,000 tax credit have all increased,” he said. “Housing affordability conditions are at record high levels and we expect a measurable increase in home sales during the second half of the year, which would help stabilize prices in most areas.”

According to Freddie Mac, the national average commitment rate on a 30-year conventional fixed-rate mortgage fell to a record low 5.06 percent in the first quarter from 5.86 percent in the fourth quarter; the rate was 5.88 percent in the first quarter of 2008.

Yun said some areas showed dramatic drops in home prices. “In areas with the biggest price declines, we also see much higher levels of distressed sales which are distorting the data,” he said. “We are very much in a bifurcated market with sharp differences between foreclosures and short sales on one hand, and traditional homes on the other. In many cases homes are selling below replacement construction costs, which speaks to great value in the current market.”

State, Local Bright Spots

The largest first-quarter sales gain from a year ago was in Nevada, up 116.8 percent, followed by California which rose 80.6 percent; Arizona, up 50.2 percent; and Florida with a 25.0 percent increase. Virginia and Minnesota also experienced double-digit sales increases.

The largest single-family home price increase in the first quarter was in the Cumberland area of Maryland and West Virginia, where the median price of $114,900 rose 21.1 percent from a year ago.

Next was the Davenport-Moline-Rock Island area of Iowa and Illinois at $100,300, up 13.8 percent from the first quarter of 2008, followed by Columbia, Mo., where the median price increased 6.0 percent to $152,600.

Median first-quarter metro area single-family home prices ranged from a very affordable $30,300 in the Saginaw-Saginaw Township North area of Michigan to $570,000 in Honolulu. The second most expensive area was the San Jose-Sunnyvale-Santa Clara area of California, at $450,000, followed by the Anaheim-Santa Ana-Irvine area of California at $435,800.
Other affordable markets include Akron, Ohio, at $50,100, and the Youngstown-Warren-Boardman area of Ohio and Pennsylvania at $51,200.

Condo Trends

In the condo sector, metro area condominium and cooperative prices – covering changes in 56 metro areas – showed the national median existing-condo price was $172,800 in the first quarter, down 20.2 percent from the first quarter of 2008. Five metros showed annual increases in the median condo price and 51 areas had declines.

The strongest condo price increases were in Portland-South Portland-Biddeford, Maine, at $196,900, up 11.2 percent, followed by the Wichita, Kan., area, where the median condo price of $113,900 rose 6.8 percent from the first quarter of 2008, and Bismarck, N.D., at $132,400, up 6.0 percent.

Metro area median existing-condo prices in the first quarter ranged from $75,200 in Las Vegas-Paradise, Nev., to $345,900 in San Francisco-Oakland-Fremont. The second most expensive reported condo market was Honolulu at $300,000, followed by the New York-Wayne-White Plains area of New York and New Jersey at $282,300.

Other affordable condo markets include the Palm Bay-Melbourne-Titusville area of Florida at $90,600 in the first quarter, and the Sacramento-Arden-Arcade-Roseville area of California at $93,800.

Regional Sales Volume, Prices

Regionally, existing-home sales in the Northeast fell 10.3 percent in the first quarter to a pace of 693,000 units and are 20.1 percent below a year ago.

The median existing single-family home price in the Northeast declined 15.9 percent to $235,500 in the first quarter from the same period in 2008. The best gain in the region was in Syracuse, N.Y., where the median price of $113,700 rose 3.1 percent from the first quarter of 2008, followed by Buffalo-Niagara Falls, N.Y., at $99,200, up 2.7 percent, and Binghamton, N.Y., where the median rose 0.5 percent to $110,300.

In the Midwest, existing-home sales slipped 2.2 percent in the first quarter to a pace of 1.04 million and are 13.1 percent below a year ago.

The median existing single-family home price in the Midwest was down 6.8 percent to $132,400 in the first quarter from the same period in 2008. After Davenport-Moline-Rock Island and Columbia, the next strongest metro price increase in the region was in Springfield, Ill., where the median price of $111,400 was 3.9 percent higher than a year ago, followed by Topeka, Kan., at $106,500, up 3.1 percent, and Bloomington-Normal, Ill., at $153,800, up 1.9 percent.

In the South, existing-home sales declined 2.5 percent in the first quarter to an annual rate of 1.70 million and are 12.7 percent lower than the same period in 2008.

The median existing single-family home price in the South was $146,600 in the first quarter, down 10.8 percent from a year earlier. After Cumberland, the strongest price increase in the region was in Beaumont-Port Arthur, Texas, with a 5.0 percent gain to $129,100, followed by Oklahoma City, at $129,900, up 4.0 percent, and Shreveport-Bossier City, La., at $136,000, up 3.4 percent.

Existing-home sales in the West slipped 0.9 percent in the first quarter to an annual rate of 1.16 million but are 24.3 percent above a year ago.

The median existing single-family home price in the West was $237,600 in the first quarter, which is 19.8 percent below the first quarter of 2008. The strongest price gain in the West was in the Salt Lake City area, where the median price of $230,100 rose 1.9 percent from a year earlier, followed by Farmington, N.M., at $191,200, up 0.7 percent.



Foreclosures jump as moratorium ends
2009/04/16, 4:28 pm
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Foreclosures jumped 46 percent in March compared to a year earlier and were up 17 percent compared to February with more than 340,000 properties affected nationwide, according to foreclosure marketer RealtyTrac.

Nearly 804,000 homes received at least one foreclosure-related notice from January through March, up from about 650,000 in the same time period a year earlier, RealtyTrac says.

Many lenders and servers had put a moratorium on foreclosures, waiting for the details of the Obama administration’s foreclosure plan. But now they are back with a vengeance. The end of the moratorium is also driving an increase in the availability of REO properties, according to RealtyTrac.

Nevada, Arizona and California had the nation’s highest foreclosure rate. Other states in the top 10 in the first quarter were Florida, Illinois, Michigan, Georgia, Idaho, Utah and Oregon.

States with the highest number of actual foreclosures, 60 percent of the total, were California, Florida, Arizona, Nevada and Illinois. Rounding out the top 10 were Michigan, Ohio, Georgia, Texas and Virginia.

One in every 159 homes nationwide was at some stage of foreclosure, according to RealtyTrac.

Source: RealtyTrac (04/09/2009)



Buyers Say Foreclosure Deals Taking Too …
2009/04/13, 7:22 pm
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Buyers Say Foreclosure Deals Taking Too Long

Banks are quickly accepting bids and writing contracts for foreclosed homes, but buyers are complaining that settlements are taking too long.

Real estate pros say purchasing a bank-owned property is different than dealing with a regular home owner, considering that banks have to check claims on the property and problems can arise at closing. Plus, in some states, banks also need court approval of the foreclosure.

Although banks are swamped by the record number of foreclosures, the bank-owned homes will have to be sold to help stabilize residential prices and boost the housing market.

Source: Washington Post, Dina ElBoghdady (04/13/09)



NYT: Squatters call foreclosures home
2009/04/10, 12:38 pm
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Advocacy groups screen potential residents, move them into vacant homes
MIAMI – When the woman who calls herself Queen Omega moved into a three-bedroom house here last December, she introduced herself to the neighbors, signed contracts for electricity and water and ordered an Internet connection.

What she did not tell anyone was that she had no legal right to be in the home.

Ms. Omega, 48, is one of the beneficiaries of the foreclosure crisis. Through a small advocacy group of local volunteers called Take Back the Land, she moved from a friend’s couch into a newly empty house that sold just a few years ago for more than $400,000.

Michael Stoops, executive director of the National Coalition for the Homeless, said about a dozen advocacy groups around the country were actively moving homeless people into vacant homes — some working in secret, others, like Take Back the Land, operating openly.

In addition to squatting, some advocacy groups have organized civil disobedience actions in which borrowers or renters refuse to leave homes after foreclosure.

The groups say that they have sometimes received support from neighbors and that beleaguered police departments have not aggressively gone after squatters.

“We’re seeing sheriffs’ departments who are reluctant to move fast on foreclosures or evictions,” said Bill Faith, director of the Coalition on Homelessness and Housing in Ohio, which is not engaged in squatting. “They’re up to their eyeballs in this stuff. Everyone’s overwhelmed.”

On a recent afternoon, Ms. Omega sat on the tiled floor of her unfurnished living room and described plans to use the space to tie-dye clothing and sell it on the Internet, hoping to save some money before she is inevitably forced to leave.

“It’s a beautiful castle, and it’s temporary for me,” she said, “and if I can be here 24 hours, I’m thankful.” In the meantime, she said, she has instructed her adult son not to make noise, to be a good neighbor.

‘A modern-day underground railroad’
In Minnesota, a group called the Poor People’s Economic Human Rights Campaign recently moved families into 13 empty homes; in Philadelphia, the Kensington Welfare Rights Union maintains seven “human rights houses” shared by 13 families. Cheri Honkala, who is the national organizer for the Minnesota group and was homeless herself once, likened the group’s work to “a modern-day underground railroad,” and said squatters could last up to a year in a house before eviction.

Other groups, including Women in Transition in Louisville, Ky., are looking for properties to occupy, especially as they become frustrated with the lack of affordable housing and the oversupply of empty homes.

Anita Beaty, executive director of the Metro Atlanta Task Force for the Homeless, said her group had been looking into asking banks to give it abandoned buildings to renovate and occupy legally. Ms. Honkala, who was a squatter in the 1980s, said the biggest difference now was that the neighbors were often more supportive. “People who used to say, ‘That’s breaking the law,’ now that they’re living on a block with three or four empty houses, they’re very interested in helping out, bringing over mattresses or food for the families,” she said.

 

Ben Burton, executive director of the Miami Coalition for the Homeless, said squatting was still relatively rare in the city.

But Take Back the Land has had to compete with less organized squatters, said Max Rameau, the group’s director.

“We had a move-in that we were going to do one day at noon,” he said. “At 10 o’clock in the morning, I went over to the house just to make sure everything was O.K., and squatters took over our squat. Then we went to another place nearby, and squatters were in that place also.”

 

Mr. Rameau said his group differed from ad hoc squatters by operating openly, screening potential residents for mental illness and drug addiction, and requiring that they earn “sweat equity” by cleaning or doing repairs around the house and that they keep up with the utility bills.

“We change the locks,” he said. “We pull up with a truck and move in through the front door. The families get a key to the front door.” Most of the houses are in poor neighborhoods, where the neighbors are less likely to object.

Kelly Penton, director of communications for the City of Miami, said police officers needed a signed affidavit from a property’s owner — usually a bank — to evict squatters. Representatives from the city’s homeless assistance program then help the squatters find shelter.

To find properties, Mr. Rameau and his colleagues check foreclosure listings, then scout out the houses for damage. On a recent afternoon, Mr. Rameau walked around to the unlocked metal gate of an abandoned bungalow in the Liberty City neighborhood.

“Let the record reflect that there was no lock on the door,” Mr. Rameau said. “I’m not breaking in.”

Inside, the wiring and sinks had been stripped out, and there was a pile of ashes on the linoleum floor where someone had burned a telephone book — probably during a cold spell the previous week, Mr. Rameau said.

“Two or three weeks ago, this house was in good condition,” Mr. Rameau said. “Now we wouldn’t move a family in here.”

So far the group has moved 10 families into empty houses, and Mr. Rameau said the group could not afford to help any more people. “It costs us $200 per move-in,” he said.

Moving back home
Mary Trody hopes not to leave again. On Feb. 20, Ms. Trody and her family of 12 — including her mother, siblings and children — were evicted from their modest blue house northwest of the city, which the family had lived in for 22 years, because her mother had not paid the mortgage.

After a weekend of sleeping in a paneled truck, however, the family, with the help of Take Back the Land, moved back in.

“This home is what you call a real home,” Ms. Trody said. “We had all family events — Christmas parties, deaths, funerals, weddings — all in this house.”

On a splendid Florida afternoon, Ms. Trody’s dog played in the water from a hose on the front lawn. The house had mattresses on the floors, but most belongings were in storage, in case they had to leave again.

“I don’t think it’s fair living in a house and not paying,” Ms. Trody said.

She said the mortgage lender had offered the family $1,500 to leave but was unwilling to negotiate minimal payments that would allow them to stay. She said she and her husband had been looking for work since he lost his delivery job with The Miami Herald.

In the meantime, she said, “I still got knots in my stomach, because I don’t know when they’re going to come yank it back from me, when they’re going to put me back on the streets.”

The block was dotted with foreclosed homes.

Three of her neighbors said they knew she was squatting and supported her. One is Joanna Jean Pierre, 32, who affectionately refers to Ms. Trody as Momma.

Ms. Pierre said Ms. Trody was a good neighbor and should be let alone. “That’s her house,” Ms. Pierre said. “She should be here.”

Ms. Trody said that living here before, “I felt secure; I felt this is my home.”

“This is where I know I’m safe,” she added. “Now it’s like, this is a stranger. What’s going to happen?”

 

Even without furniture or homey touches, she talked about the house as if it were a member of her family.

“I know it’s not permanently, but we still have these couple days left,” she said. “It’s like a person that you’re losing, and you know you still have a few more days with them.”

This story, “More Squatters Are Calling Foreclosures Home“, originally appeared in The New York Times.

www.nytimes.com



State allocates $44 million to help mitigate foreclosures
2009/03/31, 2:20 pm
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CHARLESTON — More than $44 million has been awarded to communities and organizations across the state to buy foreclosed homes to sell or rent at affordable prices.

The top three awards include $7.4 million for the Lowcountry Housing Trust, representing Charleston, Berkeley and Dorchester counties; $5 million for the city of Greenville; and $4.28 million for the Catawba Regional Council of Government, representing Lancaster County.

The money comes through the federal government’s Neighborhood Stabilization Program, which is meant to prevent blight and declines in home values in neighborhoods with clusters of foreclosed homes.

At the same time, the program increases the inventory of affordable homes for those people earning 120% of area median income, said Tammie Hoy, director of the Lowcountry Housing Trust, which received the largest chunk of the state’s NSP funding.

The S.C. State Housing, Finance and Development Authority announced the awards last week and the money likely will flow to local housing officials by the summer, Hoy said.

Hoy estimates that the money will allow local housing officials to purchase about 100 homes now owned by banks. The $7.4 million will also cover the cost of any needed repairs to the homes, which might have been vacant for months. In addition, the money can provide homebuyers with assistance in making a down payment.

By April 15, her organization and its partners must submit to state housing officials the homes they intend to purchase. The trust’s original application sought nearly $20 million for the three counties, so local officials must pare down the list of homes they plan to buy.

Hoy emphasized that the money isn’t meant for isolated foreclosures. The federal program targets clusters of foreclosures or likely foreclosures that could bring down neighborhood values.

Hoy said the money could end up going further than the estimated 100 homes. When housing officials sell a home they have purchased, sales proceeds will be available for additional investments.

The money comes through the federal government’s Housing and Economic Recovery Act of 2008. This year’s federal stimulus plan includes $2 billion for the program, but details on applying for those dollars are not expected until May, Hoy said.

The homes would be available to people earning up to 120% of area median income. Based on 2008 data, individuals earning up to $49,000 and families of four earning up to $79,000 would qualify, though Hoy said the program might use updated 2009 income data.

Communities and organizations receiving awards: Allocation:
Lowcountry Housing Trust  (Charleston, Berkeley and Dorchester counties) $7,409,679
City of Greenville $5,000,000
Catawba Regional Council of Government (Lancaster County) $4,283,000
City of Columbia $3,900,000
Beaufort Housing Authority $2,943,000
Housing Authority of Myrtle Beach $2,500,000
Greenville County $2,260,000
Richland County $2,220,000
City of Anderson $2,173,087
City of Spartanburg $2,000,000
Sumter Housing Authority $1,700,000
Community Assistance Provider (Lexington County) $1,500,000
Santee-Lynches Affordable Housing CDC (Orangeburg County) $1,293,612
TN Development Corp. $1,038,350
SC Assoc. of Community Development Corp. $1,000,000
City of Florence $1,000,000
Community Development & Improvement Corp.  (Aiken and Darlington counties) $1,000,000
Companion Associates (Pickens) $700,000
Pickens County Habitat for Humanity $225,000
Source: S.C. State Housing, Finance and Development Authority  

http://www.scbizmag.com/content/view/113559/1/
Published March 31, 2009




Tri-county to get $7.4M to help mitigate foreclosures
2009/03/26, 7:42 pm
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Housing officials in the tri-county area have learned they will receive $7.4 million to buy foreclosed homes to sell or rent at affordable prices.

The money comes through the federal government’s Neighborhood Stabilization Program, which is meant to prevent blight and declines in home values in neighborhoods with clusters of foreclosed homes.

At the same time, the program increases the inventory of affordable homes for those people earning 120% of area median income, said Tammie Hoy, director of the Lowcountry Housing Trust.

State housing officials announced the award to the Lowcountry counties yesterday. South Carolina received a total of $44 million for the program.

Hoy estimates that the money will allow local housing officials to purchase about 100 homes now owned by banks. The $7.4 million will also cover the cost of any needed repairs to the homes, which might have been vacant for months. In addition, the money can provide homebuyers with assistance in making a down payment.

The money likely will flow to local housing officials by the summer, Hoy said.

By April 15, her organization and its partners must submit to state housing officials the homes they intend to purchase. The trust’s original application sought nearly $20 million for the three counties, so local officials must pare down the list of homes they plan to buy.

They’ll also update their lists of foreclosed homes on the market. Some might have sold in recent months, Hoy said.

“Which is a good thing,” Hoy said. “We are glad they are being sold.”

She emphasized that the money isn’t meant for isolated foreclosures. The federal program targets clusters of foreclosures or likely foreclosures that could bring down neighborhood values.

Hoy said the money could end up going further than the estimated 100 homes. When housing officials sell a home they have purchased, sales proceeds will be available for additional investments.

She said the original request for $20 million was ambitious, considering South Carolina received a total of $44 million for the program for all 46 counties.

The money comes through the federal government’s Housing and Economic Recovery Act of 2008. This year’s federal stimulus plan includes $2 billion for the program, but details on applying for those dollars are not expected until May, Hoy said.

The homes would be available to people earning up to 120% of area median income. Based on 2008 data, individuals earning up to $49,000 and families of four earning up to $79,000 would qualify, though Hoy said the program might use updated 2009 income data.