Real Estate News & Updates from the Monadnock Region
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What’s up With Fannie Mae? (Federal National Mortgage Corporation)

February 1st, 2013 | Posted by Dick Thackston in Mortgage News | News | Real Estate News - (0 Comments)

I had the opportunity to hear former Presidents Bill Clinton and George W. Bush speak at the annual Five Star REO Conference in Texas late last summer. (REO is an acronym for Real Estate Owned which is what foreclosures and bank owned properties are technically called.) Both Presidents Bush and Clinton spoke about the importance of housing to our economy and to the American way of life. Clinton spoke in relatively more detail about the future of Fannie Mae. He indicated that while the exact future of Fannie Mae is by no means clear, the service that it provides to both lenders and the economy in providing liquidity to home mortgage lenders is crucial to maintaining a vibrant and relatively free housing market in the United States.

In the last several years there has been much criticism of Fannie Mae, (and its sister company Freddie Mac),  for having provided too much liquidity to lenders – under pressure from Congress – and the liability it has created for the United States Government. There can be little question that Fannie Mae worked as planned and backed the entire United States housing market, and as bad as things have been the last several years in housing, the situation would have been much worse had Fannie Mae not existed.

In the fall of 2008 the United States Treasury placed both Fannie Mae and Freddie Mac under conservatorship and liquidated the Preferred Stockholder’s equity position. The majority of Preferred Stockholders were banks and pension funds, thus spreading the damage. Common stock in both Fannie Mae and Freddie Mac remained listed and traded on the New York Stock Exchange until mid 2010 when the stocks were delisted. Both stocks continue to be traded over the counter but have lost substantial value. Conservatorship does not mean the Treasury owns Fannie Mae or Freddie Mac, ownership is still vested in the common stock shareholders, however conservatorship does mean that the common stock shareholders have lost all control over the operations of these institutions; a situation that will remain until such time as the conservator, the United States Treasury, determines the best course of action to take with these institutions. At this time the ultimate status of Fannie Mae is indeterminate. Congress has considered a number of actions to take but has not reached any agreement and has no legislation pending to resolve Fannie Mae or Freddie Mac’s future. Fannie Mae and Freddie Mac remain ill-liquid and under government conservatorship at this time, bankruptcy, revocation of charter and or break-up into smaller entities have all been considered.

 

By Dick Thackston CRB, ABR, ABRM,BrokerNH, MA & VT

About Fannie Mae

Fannie Mae is a government-sponsored enterprise (GSE) chartered by Congress with a mission to provide liquidity, stability and affordability to the U.S.housing and mortgage markets.

Fannie Mae operates in the U.S.secondary mortgage market. Rather than making home loans directly to consumers, we work with mortgage bankers, brokers and other primary mortgage market partners to help ensure they have funds to lend to home buyers at affordable rates. We fund our mortgage investments primarily by issuing debt securities in the domestic and international capital markets.

Fannie Mae was established as a federal agency in 1938, and was chartered by Congress in 1968 as a private shareholder-owned company. On September 6, 2008, Director James Lockhart of the Federal Housing Finance Agency (FHFA) appointed FHFA as conservator of Fannie Mae. In September 2008, we also entered into an agreement with the U.S. Department of Treasury that was most recently amended in December 2009. Under the agreement, Treasury will provide us with capital as needed to correct any net worth deficiencies that we record in any quarter through 2012. The agreement is intended to ensure that we are able to continue providing liquidity and stability to the housing and mortgage markets.

Fannie Mae has three lines of business – Single-Family, Multifamily and Capital Markets – that provide services and products to lenders and a broad range of housing partners. Together, these businesses contribute to the company’s chartered mission to increase the amount of funds available in order to make homeownership and rental housing more available and affordable.

 

Early History
The FHA Administrator chartered Fannie Mae on February 10, 1938. The impetus for creation of Fannie Mae was twofold: the national commitment to housing and the inability or unwillingness of private lenders to ensure a reliable supply of mortgage credit throughout the country. The primary purpose of Fannie Mae was to purchase, hold, or sell FHA-insured mortgage loans that had been originated by private lenders. After World War II, Fannie Mae’s authority was expanded to include VA-guaranteed home mortgages.

1954 Charter Act
The Charter Act of 1954 provided the basic framework under which Fannie Mae operates today but did not remove it from direct federal control. The act removed government backing for borrowings used to fund Fannie Mae’s secondary market operations. It stipulated that Fannie Mae be exempt from all local taxes except property taxes, and provided for the Federal Reserve Banks to perform various services for Fannie Mae. The 1954 Charter Act also defined the path by which Fannie Mae’s secondary market operations would be transferred to the private sector: proceeds from gradual sales of common stock were to be used to retire Treasury-owned preferred stock in Fannie Mae.

1968 Charter Act
The 1968 Charter Act split Fannie Mae into two parts: Ginnie Mae and a reconstituted Fannie Mae. Ginnie Mae would continue as a federal agency and be responsible for the then-existing special assistance programs, and Fannie Mae would be transformed into a “government-sponsored private corporation” responsible for the self-supporting secondary market operations. The reconstituted Fannie Mae was to be stockholder-owned and managed. Fannie Mae retired the last of its government stock on September 30, 1968, and transformation to a government-sponsored private corporation was completed in 1970.

The 1968 Act provided the authority to issue Mortgage-Backed Securities (MBS).

The Act also established a regulatory structure to ensure Fannie Mae’s adherence to its public purpose. It provided for continuing HUD oversight of Fannie Mae, granting “general regulatory power … to insure that the purposes of this Title are accomplished.”

Emergency Home Finance Act of 1970
The Emergency Home Finance Act of 1970 created Freddie Mac and authorized it to create a secondary market for conventional mortgages. Parallel authority and limitations to deal in conventional mortgages were given to Fannie Mae.

To alleviate credit concerns raised by acquisition of conventional mortgages (that lack federal backing), several eligibility restrictions and/or risk sharing requirements were imposed on the mortgages Fannie Mae could buy.

The new law also required the HUD Secretary to provide prior approval of Fannie Mae’s “purchase” or “dealing in” conventional mortgages (later interpreted by HUD regulations in 1995 to require specific approval of new and different conventional “programs”).

Secondary Mortgage Market Enhancement Act of 1984
The Secondary Mortgage Market Enhancement Act of 1984 (“SMMEA”) clarified and modified several of HUD’s regulatory powers over Fannie Mae. It required HUD to respond within 45 days to any request for new program approval made by Fannie Mae under the Charter Act (with a 15-day extension permitted) and authorized Fannie Mae to purchase and deal in subordinate lien mortgages.

Financial Institutions Reform, Recovery, and Enforcement Act of 1989
The Financial Institutions Reform, Recovery, and Enforcement Act (“FIRREA”) of 1989 made regulation of Fannie Mae and Freddie Mac consistent. Until 1989, Freddie Mac was owned by the Federal Home Loan Bank System and its member thrifts and governed by the Federal Home Loan Bank Board (later reorganized into the Office of Thrift Supervision). FIRREA severed Freddie Mac’s ties to the Federal Home Loan Bank System, created an 18-member board of directors to run Freddie Mac, and subjected it to HUD oversight.

Also, the GAO and Treasury were instructed to conduct studies of Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. These studies laid the foundation for comprehensive regulatory modernization for both Fannie Mae and Freddie Mac in 1992.

The Federal Housing Enterprises Financial Safety and Soundness Act of 1992
The Federal Housing Enterprises Financial Safety and Soundness Act (“FHEFSSA”) of 1992 modernized the regulatory oversight of Fannie Mae and Freddie Mac. It created the Office of Federal Housing Enterprise Oversight (“OFHEO”) as a new regulatory office within HUD with the responsibility to “ensure that Fannie Mae and Freddie Mac are adequately capitalized and operating safely.” OFHEO is funded by assessments on Fannie Mae and Freddie Mac and is authorized to act without HUD oversight on a range of regulatory issues enumerated in the statute. FHEFSSA established risk-based and minimum capital standards for Fannie Mae and Freddie Mac. And, it established HUD-imposed housing goals for financing of affordable housing and housing in central cities and other rural and underserved areas.

The Housing and Economic Recovery Act of 2008
The Housing and Economic Recovery Act of 2008 (‘HERA’) strengthened governmental oversight of Fannie Mae and Freddie Mac. It established the Federal Housing Finance Agency (FHFA), which replaced OFHEO and HUD as Fannie Mae’s safety and soundness and mission regulator. Among other things, FHFA has broad authority to require Fannie Mae to hold capital above statutory minimum levels, regulate the size and content of our portfolio, and approve new mortgage products.

 

http://www.fanniemae.com/about/index.html

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The Elections Over! So now what for housing?

November 13th, 2012 | Posted by Dick Thackston in New Real Estate | News | Real Estate News - (0 Comments)

After what feels like an election cycle that has lasted forever (over eighteen months in New Hampshire) perhaps we can get on with the business of running our lives and business in a stable environment. While I’m not a great fan on what has happened over the last four years in Washington, at least we know where we are and given no great new changes in the economy or in Washington and there are some realities that are pretty apparent.

Clearly, housing has bottomed and there are signs of a kind of stability in residential housing. The majority of sales are Bank/lender owned properties; a record number of which are selling for cash. My own experience is that about thirty percent of sales are cash. I have spoken with other REALTORS in our area a few have reported cash sales as high as forty percent and a few have reported cash sales of around twenty-five percent, but all are in agreement the cash sales represent a huge chunk of the residential business at  this time. The drivers here are the truly low interest rates that savers can earn on any cash reserves they may have, the difficulty in obtaining financing generally and the difficulty in obtaining financing specifically on bank/lender owned properties due to the generally poor condition of these properties. The Federal Reserves continued commitment to keeping interest rates low into 2014 means this is likely to remain a major part of real estate sales into the future.

The end of the loan modification programs from Fannie Mae and Freddie Mac means that the message is clear to borrowers: if you want to keep your house you must pay the mortgage. These programs were almost criminally maladministered and sent mixed messages to home owners. Many homeowners stopped making their mortgage payments so that they could take advantage of these programs and actually ended up loosing their homes. The disappearance of these programs is likely to stabilize the housing market more than any other single event. More stable housing market = fewer foreclosures = better prices = housing recovery, although it will still take years to work through the backlog of homes in various stages of foreclosure.

The current administration remaining in office in Washington is also probably good news for housing and the average home buyer. It is more likely that the current administration will act to support the concept of a secondary market for home mortgages through Fannie Mae and Freddie Mac. Proposals put out by some of the more conservative supporters of the Republicans in the last election cycle to dismantle Fannie Mae and Freddie Mac and to have required huge down payments would have been a greater drag on housing and the economy than any of the various proposed limitations on interest deductions on home mortgages. Any thing that eases housing lending will be good for a recovery in housing.

Banks/lenders have been far more proactive about foreclosing on properties in recent weeks and months. They have been quicker to act on delinquencies and been quicker to act in putting properties on the market than at anytime in the last five years.

The primary focus in housing sales for the foreseeable year or more is likely to be bank/lender owned properties. Until a significant share of the foreclosure back log is burned up through new sales, foreclosures will be the driving force in house prices leaving little or no room for price increases through this and most regions of the country with first timers and investors being the primary source of buyers.

 

By Dick Thackston CRB, ABR, ABRM

Broker NH, MA & VT

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Different Housing Needs for Different Generations

June 14th, 2012 | Posted by Dick Thackston in Mortgage News | News | Real Estate News - (0 Comments)

I see America changing every day when I talk to home buyers. American’s expectations about housing are switching rapidly from the “American Dream” of Mom, Dad, kids and a house in the suburbs, not as much because of the financial decay of the last three years, but rather because the current generation of Home Buyers, the so called “GenY”, has moved away from the highly conformist expectations of their grandparents – the “Baby Boomers” – to a highly diverse, multicultural, multidimensional society.

The Baby Boomers experience, viewed as a cultural event or milestone, has had more impact on American society, real estate and home ownership than any other event in American society since the Civil War. Boomers were raised with these expectations and typically only owned three or four homes in their lives – this is the generation that had mortgage burning parties when they paid off their homes and built a pool.

The Gen X’ers, the children and grandchildren of the Baby Boomers, never fully adopted the lifestyle of their elders. This is the generation that came of age in the boom years of the 80’s and 90’s. This generation used credit cards, car loans and mortgages like no generation before. This is the generation the treated their homes as Piggy Banks and expecting to buy low and sell high on every home they would ever own and they expected to own a lot of them too! Gen X’ers as a group expected to stay in multiple homes for short periods – three to four years max – disposable lifestyles. Their generation is much smaller then the “Baby Boomers” as a group but has had a disproportionate impact on the housing market. While these Gen X’ers have had an immediate short term negative effect on housing and the American Economy as a whole, the effect on real estate will be short term because this is a small generation. The dramatically different “Generation Y”, aka “The Microwave Generation”, influence is already being felt on the real estate market and the economy as a whole.

“Generation Y” is much larger than the Gen X’ers and has a completely different agenda. Financially, socially and educationally, Gen Y is dramatically different than either of the two prior generations of Americans. Gen Y is much more likely to have an IRA or a 401K than either of the earlier generations and at a much earlier stage in life: Baby Boomers expected a pension, Social Security and the equity in their home to carry them through retirement; the Gen X’ers expected to flip houses to infinity and beyond with minimal reserves and limited funding of retirement accounts.

“Generation Y’s” effect on housing will be as dramatic as that of the post World War II baby Boomers or greater. The Y’s are happy to not own a home any time soon if at all. It’s more important to the Y’s to have flexibility and cash. This is a generation that has student loans like no other before but that’s because as a group they view education not as just as important but imperative to their lives. Lifestyle choices such as access to services, an elegant downtown – clubs and shopping – is more important than owning a home. Y’s as a group are looking for housing that meets those criterion rather than a quarter acre lot and a three bedroom house.

Sure, Generation Y’s expect to own homes, but it is not an urgent first order of business as it was for their parent and grandparents. Generation Y’s perspective on real estate ownership is colored by their willingness to rent. (Sixty plus per cent of renters want to own their own home someday according to a recent survey by PulteCorp.) The Y’s interest in savings is reflected in the much higher contribution rates to IRA’s and 401K’s than either of the prior generations combined with their much higher student loans and need for “a lifestyle” that is more cosmopolitan and focused on convenience than the Generations of “Boomers” and “X’s” that came before them.

By Dick Thackston CRB, ABR, ABRM

Broker NH, MA & VT

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What is New Hampshire’s Current Use Law?

May 14th, 2012 | Posted by Dick Thackston in News | Real Estate News - (0 Comments)

On July 1, 1973 the Current Use Law became effective in New Hampshire.  The Current Use law was designed to keep New Hampshire’s rural character in tact while allowing owner’s to use the land quoting from the preamble to the law itself: “It is hereby declared to be in the public interest to encourage preservation of open space, thus providing a healthful and attractive outdoor environment for work and recreation of the state’s citizen’s, maintaining the character of the state’s landscape, and conserving the land, water, forest, agricultural and wildlife resources.”

The effect of the Current Use law has been to provide a lower tax rate on larger tracts of land so that property owners would not be forced to subdivide and sell off their property in order to cope with large property tax bills. By keeping land in an undeveloped condition family farms have been preserved as well as woodlands, wet lands and other tracts that might well have been lost over the last thirty-nine years.

Over half on the land in New Hampshireis enrolled in the Current Use program and it has been the foundation of the State of New Hampshireprivate property based land conservation program.

The following are characteristics of the State of New Hampshire’s Current Use Program:

Generally speaking a parcel must be of at least ten acres, exceptions to this are wetlands of any size, tree farms of any size and parcels of less than ten acres that produce more than $2,500 in agricultural products. Open undeveloped land that is less than ten acres as well as any area covered by buildings does not qualify for Current Use.

If an owner acquires abutting parcels of less than ten acres the additional parcels can be added and would qualify for Current Use or if an owner has a number of abutting parcels of less than ten acres each but the entire contiguous amount owned is ten or more acres then the property is eligible for Current Use.

What is a contiguous parcel? Contiguous parcels under the Current Use Law are defined by the NHSPACE.org website as “more than one parcel of land, which is connected, even if a highway, rail bed, river or water body divides it. This means land that touches any of your property boundaries, or is across the road or on the other side of a pond, stream or river, on both sides of railroad tracks, or across a political boundary.”

If a property owner enrolls his property in Current Use it does not mean his land is now “Open to the Public”. When a property owner enrolls his property in Current Use it is still private property – remember the focus of this law has been keeping New Hampshirelarge undeveloped tracts in private hands – the property owner still has the right to determine how his property will be used just as he would if it were not in Current Use.

For more details on New Hampshire’s Current Use Law visit NHSPACE.org

 

By Dick Thackston CRB, ABR, ABRM

Broker NH, MA & VT

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Strange, but True: Your House Price Drops but REO Properties go up in Price!

May 10th, 2012 | Posted by Dick Thackston in Mortgage News | News | Real Estate News - (0 Comments)

According to several industry sources the average value of bank owned, REO Properties, has actually increased in the last years while the value of non-bank owned real estate has dropped on average! There are several reasons in the realm of conventional wisdom as to why this is happening; the most common reason given is that REO properties are being bought up by investment groups and turned into rentals thus driving up the price of REO’s on average. While this certainly is a factor there are other factors that are probably more important to the change in real estate values that I see happening as a “boots on the ground REALTOR”.

Here’s how I see it. The initial wave of foreclosures was for the most part badly maintained and marginal properties: no real surprise that the most marginal home owners were the least able to maintain and upgrade their homes and least able to hang on through tough, tougher and tougher economic times. These homes languished off the market as so called “shadow inventory” for months and in many cases years due to a hostile regulatory and legal environment in which mortgage holders found themselves, thus slowing up the process of foreclosure, resale and return of these residential assets to productive use. No news there really. What the facts recently made public noted about rising REO prices and declining price on non-bank owned real estate indicates is not that we are “moving toward the middle” but in-fact indicate that we are continuing to crater the housing market in slow motion.

This pattern of rising REO value reflects exactly what many experienced REO REALTORS have noted over the last six to nine months: we are getting better quality inventory. The better quality inventory is the result of the economic damage moving up the food chain from the economic bottom into the middle and above. The middle class buyer that bought his house at a fair market price in 2009 is likely to find that when he goes to sell his home today it’s worth the same or a little less and that any improvements he made have added little or no value. So, if they can’t hang on and they can’t sell they let it go. Thus leading to a better class REO property and putting further and continuing pressure on the middle of the market.

What does it all mean? It means that there is no foreseeable improvement coming for non-REO properties and that REO properties will continue to dominate the residential real estate market. Warren Buffet is right: single family homes are likely to continue to be an excellent investment for those who can“buy and hold” but only for those who can buy and hold either as owner occupants or as investors looking at increasingly higher and higher rents over the foreseeable future.

 

By Dick Thackston CRB, ABR, ABRM

Broker NH, MA & VT

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ServiceLink and PartnerFirst recently announced a renewal of their agreement in providing solutions for the nation’s housing crisis.

March 21st, 2012 | Posted by Dick Thackston in Uncategorized - (0 Comments)

CORONA, Calif., March 12, 2012 /PRNewswire via COMTEX/ — PartnerFirst is pleased to announce the renewal of its contract with ServiceLink as its nationwide short sale agent network. Through this alliance, now entering its third year, thousands of distressed homeowners can use PartnerFirst agents to resolve their mortgage problems.

PartnerFirst powers the ServiceLink Short Sale Agent Network which connects distressed homeowners with qualified real estate professionals. Through its education platform, including the Pre-foreclosure Specialist Certification (PSC), PartnerFirst educates agents to help distressed homeowners.

Regarding the ongoing alliance with PartnerFirst, Leo Esposito, ServiceLink’s Senior Vice President of Loss Mitigation and Asset Disposition, said, “ServiceLink is pleased with the agent education services and the quality of agents provided by PartnerFirst to power the ServiceLink Short Sale Agent Network. This marks the third year that the two firms will be working together to achieve solutions for the nation’s housing crisis.”

ServiceLink, the national lender platform of Fidelity National Financial, has managed over $10 billion in short sale transactions, working with five of the nation’s top ten lenders. With its experience in working with lenders, investors, mortgage insurers, and junior lien holders, ServiceLink has the flexibility to provide efficient solutions and expeditious closings.

The short sale alternative preserves neighborhood values, minimizes loan loss severities for investors, and provides a dignified resolution for distressed borrowers.

For more information, or to sign up as a ServiceLink short sale agent, visit: http://www.servicelinkfnf.com/downloads/ShortSaleAgentPackage.pdf .

SOURCE PartnerFirst

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Is the Ice Breaking for Home Builders?

January 20th, 2012 | Posted by Dick Thackston in News | Real Estate News - (0 Comments)

The National Association of Home Builders maintains indices that measure conditions for the home building industry. There are three basic measures that the NAHB looks at as measure of were the home building industry is at: traffic visiting model homes, current sales conditions and the most subjective of the three expectations for the next six months. When you look at these numbers 50 is the benchmark number anything under 50 is poor any thing over 50 is good.

Conditions have shown improvement over the last four months.

Last month’s traffic visiting model homes increased from 18 to 21; an increase of about 20% and similar to what we have seen in the “re-sale” home market. (Keep in mind its still winter in the northeast and this is not prime home selling season- really very dramatic news!) Last month’s number for current sales conditions moved from 22 to 25 which measures factors such as availability of financing, terms, interest rates and available inventory among other things and expectations for the next six months moved from 26 to 29.

The NAHB also looks at these number by census regions rather than state by state or just the nation in aggregate. The Northeast moved the most from 14 to 23 and the Mid West moved the least from 23 to 24. It’s probably worth noting that the mid-West has been one of the least impacted regions of the country in our now five + year old real estate downturn.

The South is considered the most important number for the nation and the association because it by far the largest region for population and business in the country. The South moved from 25 to 27. The West moved from 16 to 21.

Obviously, our primary/only concern is the Northeast which includes New England, (New Hampshire, Massachusetts, Vermont, Maine, Rhode Island and Maine). Prospects remain positive and cautious on all fronts in the real estate world and the “all clear” is by no means appropriate at this time. These are not great numbers but they are significantly less bad than the numbers of the recent past and may/hopefully reflect an upward trend that will be unfolding over the next several months as weather improves and the situation becomes clearer to all on employment and other investments besides real estate.

By Dick Thackston CRB, ABR, ABRM

Broker NH, MA & VT

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The Three Es of Real Estate in 2012?

January 17th, 2012 | Posted by Dick Thackston in Mortgage News | Real Estate News - (0 Comments)

By Dick Thackston

2012 is likely to be defined, in the real estate world, by three “E’s”: Expectations, Employment and Europe/Economy. No matter what your political belief system is, no matter how much or how little money you have, these three factors will permeate American life and the economy more than any others in the next eleven and a half months.

Expectations: In the world of sales there is an old truism, “To live with the classes sell to the masses!” those will be the watch words for real estate this year. 2012’s real estate will almost certainly only be about first time buyers and large volumes of REO properties being sold to investors. Both first time buyers and investors have some striking similarities: both groups feel they are buying at the bottom of the market and both groups have an expectation of housing prices increasing over the next three to five years and both groups have an expectation of rents remaining and going higher. (Personally, I agree with both groups.) First time buyers not only have the family formation/nesting instinct driving them into purchasing, but they have the ever increasing cost of renting versus home ownership. Most first time home buyers are renters now and are looking at homes that will have monthly mortgage payments 15-20% below their current rent. Landlords/Investors are looking at the exact same equation from the other side and seeing that almost anything they buy now will have positive cash flow of at least 10% and often up to 20%. The group that is melting away at this time is the investors looking to buy, fix and flip, the risks are too great of carrying a vacant property or over improving and taking a hit in what is in fact a flat market, and of course move-up buyer’s remain effectively locked out of the market for the foreseeable future. Until move up buyers can sell and move there is likely to be no updraft in the real estate market, but when it does begin it will be huge.

Employment: In New Hampshirefor sure, the Northeast in general and for the nation probably, employment getting better.New Hampshire has experienced job creation. Not dramatic but some. GivenNew Hampshire’s favorable tax and business environment it’s not really surprising that it would be one of the first parts of the country to recover. New England more generally seems to be getting better although not at the same rate as New Hampshireand the nation, well let’s face it would be hard to screw things up much more – which is a perverse kind of improvement actually. So as workers become more secure in their outlook on employment, they become more confident that they can cope with a mortgage payment and the other cost associated with home ownership, and are feeling much better about leaving their apartments and Mom’s basement. This is having a very noticeable effect on stabilizing the market at the bottom.

Economy: The macro-economic environment remains dicey. I almost headed this section “Europe” as my third “E” but really it’s bigger than all that. The United Sates is no longer insulated from the rest of the world economically. I doubt that this was ever really true, but we felt it was true and we certainly acted as if it was true. The United States remains the world’s largest economy however it remains subject to outside shocks: Tsunami & nuclear disaster in Japan, economic slowdown in China and most dramatically European debit crisis – country by country bad news out of Europe send shocks through our financial system and impacts our banking sector. The largest of these in public perception is Europe which is unlikely to be resolved anytime soon and will continue to drag on the world economy. China seems to have better managed its financial affairs – easier in a totalitarian state – and seems likely to have a softer economic landing than Europe.

What’s the take away from all this? Housing is stabilizing now; sales volume is likely to increase significantly; good deals from a buyer’s perspective are likely to remain the norm for the next eight to twelve months; no real appreciation in real estate as an asset class is likely and value added efforts for renovations will remain high risk till after the end of 2012.

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Will 2012 be the Year of The Buyer Broker?

January 9th, 2012 | Posted by Dick Thackston in Buying Tips | Real Estate News | Selling Tips - (0 Comments)

By Dick Thackston

By now if you’re in the housing market, have been in the housing market or are thinking about being in the housing market, you’ve heard about buyer brokerage. Most folks, consumers & REALTORS, have an idea about buyer brokerage but very few actually understand it or have the training and background to engage in it effectively. Most real estate consumers tend to only see the short term, regardless of the market situation rising or falling; consumers tend to not see the long term. One of the most important services a Buyer Broker can provide is a long term perspective – knowing why a property is worthy of buying selling or holding. If that sounds about right to you then read on.

Most of the information about buyer agency in particular and real estate in general is written by, well, writers – people who write blogs, newspaper & magazine articles, TV scripts etc. Unfortunately, these folks are not the best judges of what is actually happening in the real estate world; their analysis, while genuine, is not usually based in any actual experience. Higher an experienced buyer broker, like myself or the Accredited Buyer’s Agents that work with me, whose only goal is to help you make the best buying decisions, and can freely share our experience and knowledge with you, is one of the most critical services you can obtain in making your real estate profitable.

A good relationship with a buyer broker means that number one you speak the same language: you can readily and honestly communicate back and forth about the pros and cons of each possibility. Keeping thirty to forty properties under review and analysis is not unusual in this market; many times your buyer broker is studying the market changes to let you know of interest in properties, price changes, zoning changes, vacancy rates, employment and any number of other factors that are specific to your plans. Often a good buyer broker will look for the best property of the day that targets your situation; by this I don’t mean just putting you on an auto delivery from the MLS but they will actually review properties daily and let you know the best buy of the day. Conversely they should be watching the properties in your portfolio of prospective purchases that would take them off your list as well.

Most importantly of all you need to have clear commitment between each of you as to how fees will be handled between you and the extent to which you want to work with each other.

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Up to Four Million Foreclosures to be Reviewed by Government!

November 3rd, 2011 | Posted by Dick Thackston in Mortgage News | News | Real Estate News - (0 Comments)

By Dick Thackston CRB, ABRM, ABR

The Office of the Comptroller of the Currency has begun sending out letters to borrowers who have faced foreclosure since 2009. It is estimated that approximately four million borrowers foreclosures may have been mishandled between January 1, 2009 and December 31, 2010. Federal regulators and most of the nation’s largest home mortgage servicers announced earlier this week.

Cases will be reviewed by Federal Regulators as a result of an agreement established in April of this year in which the nation’s fourteen top mortgage servicers agreed with regulators to hire independent consultants to evaluate foreclosure processes and determine if borrowers had experienced financial injury as a result of errors or abuses by servicers. It will be up to the independent consultants to evaluate cases and determine compensation if any due to borrowers.

The Comptroller of the Currency as well as the Federal Reserve will be sending mails between now and the end of the year to notify potential victims of their rights. A mass media campaign is planned as well to direct borrowers to the website www.IndependentForeclosureReview.com or the toll free number 888.952.9105. All requests for review must be submitted by April 30, 2012.

The mortgage servicers and the government agreed that the servicers would pay all the expenses associated of setting up the program. Under government supervision they have hired eight independent consultants that have designed the program to be at no cost to the borrowers. The consultants have set up the website and call center noted above. The program is designed to encourage borrowers from all lenders to use one portal and there is uniform branding and product design to be clearer in the public mind than a number of different sites would be to the public.

There are several basic patterns that the consultants will be looking at to determine wrongdoing and these include miscalculation of fees, a foreclosure that happened while a borrower was under bankruptcy court protection and the most common one in my experience a foreclosure that was done while a borrower was waiting for a response on a loan modification.

This program is a direct result of last year’s robo signing scandal and the investigations that followed. About a year ago it came to public light that many mortgage servicers were cutting corners on due process when foreclosing on properties and either not properly executing documents or simply faking documents to expedite the large number of foreclosures they had on their hands.

This program is a good solution to an unfortunate situation. Objectively, most of these borrowers were in fact behind and many if not most were ready and willingly left their properties to begin over, however that does justify short cutting the legal protection of property rights built into our system of property ownership over the last thousand years from Common Law to Current Law.

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