HomeRun Homes Rent to Own Homes Blog

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HomeRun Homes is a centralized marketplace which helps people Find or Sell a Rent to Own Home, both Nationwide and Globally to the thriving Rent to Own Market. http://www.lease2buy.com

August 30, 2011

Short-Term Bumps, Long-Term Jumps

Hi Folks,

   Welcome Back, and I join you on this special day (it's my son's 5th birthday, and ice cream cake with the inevitable sugar rush might render me comatose by tonight). But it is a fun day !

   Back to Real Estate (what you came here for!)

   Obviously, Home Sales and Home Prices are critical to the Real Estate market, and we had a couple of figures released this week that we'd like to discuss with you today, coincidentally Pending Home Sales and Standard & Poors/Case-Shiller Home Prices.

   Per the National Association of Realtors®, or NAR, the Pending Home Sales Index was Down 1.3% in from June to July of this year, but it was Up 14.4% from July 2010 to July 2011. The NAR reports that all regions showed monthly declines, with the West showing the "highest level of sales contract activity", with a 3.6% increase from June-July of this year, and an amazing 20.6% from July 2010.

   As for Home Prices, the Standard and Poors/Case-Shiller Home Price Index reported that nationally, Home Prices Went Up 3.6% from Q1 to Q2 of this year, but dropped 5.9% From Q2 of 2010 to Q2 of 2011, and they added that, Nationally, "home prices are back to their early 2003 levels".

   David M. Blitzer, Chairman of the Index Committee at Standard & Poors Indices, stated that shifts in pricing amongst different regions suggests that, "we are back to regional housing markets, rather than a national housing market where everything rose and fell together."

   Lawrence Yun, NAR chief economist, said that the market can move into a "healthy expansion", with a return to normalcy in mortgage underwriting standards. As the Pending Home Sales Index is a "forward-looking indicator based on contract signings", and the data reflects contracts but not closings, Yun also made a point to say that "not all sales contracts are leading to closed existing-home sales", and says that "other market frictions need to be addressed, such as assuring that proper comparables are used in appraisal valuations, and streamlining the short sales process.”

   On a positive note, Yun says that “The underlying factors for improving sales are developing", and points to "rising rents, record high affordability conditions and investors buying real estate as a future inflation hedge", but reiterates that it is "now a question of lending standards", along with consumers "having the necessary confidence to enter the market.”

   Here is my 2-cent opinion: I like to look at changes over the long-haul, i.e., from the same time 2010 vs the same time 2011. With that thought in mind, we jumped 14.4% in Pending Home Sales but Home Prices (Index of Prices) dropped 5.9%. Just as the title of this post suggests; Short-Term Bumps, Long-Term Jumps...!

   What are your opinions on these new figures? What does it mean to you?

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Have a Great Week, and Happy Rent-to-Owning !
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Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #HomeSales #HomePrices #RealEstate #shortsales #CaseShiller #NAR #mortgageunderwriting

August 29, 2011

Rent, Own, or the Hybrid of Rent to Own?

Hi Folks,
   Welcome back, and I hope all of you made it safely through Hurricane Irene, and ironically, this weekend was the 6-Year anniversary of Hurricane Katrina. I am still without power, as I post this from a laptop with draining power and through my wireless Droid hotspot. But...the show must go on...

   Oftentimes, when people are renting a home, they get to a point where they realize that they are paying their landlord's mortgage, putting the landlord's kids through college, or any of a million other ways to spin it. But with the complete change in the "norm" that has taken place over the last few years, these thoughts need to be seriously weighed in light of many other factors.

   David Getson, a Realtor with Coldwell Banker Residential in the District of Columbia, was recently quoted in a story by Michele Lerner ("Rent-vs.-own equation changing"), and said that the decision to buy a home vs. rent a home is, “Usually this is an emotional decision rather than a financial one, based on their desire for a dog, to start a family, to put down roots or just to have the ability to paint their walls whatever color they want.”

   Lerner writes that the decision to move from renter to homeowner was "simpler in 2005 for two reasons", which she points to as the "trajectory" of real estate prices that made buyers "comfortable that the property purchase would be a good investment", coupled with the fact that mortgage lenders "made it easy for buyers to qualify, even if they lacked cash and had yet to demonstrate a pattern of creditworthiness." However, she writes, the decision nowadays required "more measured thinking about the emotional impact and the financial implications of purchasing a home."

   Getson advises that potential buyers must look at their lifestyle today and the lifestyle they expect to have in 5+ years. In the same story, Bennett Whitlock, a financial adviser and managing director of Whitlock and Associates in Lake Ridge, Va., said, "becoming a homeowner should be part of an overall financial plan rather than a simple rent-versus-own decision."

   Lerner says that instead of contacting a Realtor as a first step (as most potential buyers do), they really should visit a lender and estimate how much they can borrow. Mark Goldstein, president of Capitol Funding in Rockville, adds that some important factors are Job Security, the amount of time the buyers plan to stay in the home, and suggests that buyers should assume 5+ years in the home to recoup costs and see appreciation (similar to the comments of Getson).

   Financially, Getson says that buyers today, "seem to recognize that their comfort level with the monthly payment is more important than borrowing as much as they are approved for". With that in mind, Whitlock suggests to avoid spending more than 33% of your gross monthly income on housing costs. As for a security cushion to cover home maintenance and repairs, Goldstein recommends that you keep some cash reserves on hand.

   Goldstein suggests that one way he advises buyers to prepare for homeownership is to, "take the difference between their current rent and their prospective mortgage payment and put that money in a savings account each month”, and adds that this helps the prospective buyer "get used to the monthly payment and make sure they are comfortable with it, rather than finding out six months after they bought a house that they are paying too much for their mortgage". Definitely a fantastic idea!

   Rent or Own? Decisions, Decisions...! How about the best of both worlds...Rent to Own? Great idea? Yes, I know...shameful promotion time...Rent to Own Homes via our website (HomeRun Homes). OK, sometimes we plug the site...the idea is not to abuse it !

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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #landlord #mortgage #realtor #renter #homeowner #lender #renttoown


August 25, 2011

Home Remodeling Spike Indicates Signs Of Life

Hi Folks,
   Welcome Back, and Happy Friday !!

   On Wednesday, we spoke about some cool ways to look at the median age of the inventory of homes available for sale ("Young Inventory Translates To Quick Markets"), and we had some pretty solid direct and also some offline feedback on the topic (Thanks!).

   Another very interesting tidbit that crossed my path was that homeowners are starting to remodel their homes, which is an incredibly good sign. One of the most telling factors is from Home Depot, which, according to a story titled, "Home Depot profits rise on repair trends" by Liz Enochs, saw a 14.3% jump in 2Q net income. Enoch writes that the core purchases are, "indicative of a focus on repairs and renovation, a point Blake touched on in a comment to analysts". Additionally, Home Depot is also seeing an "increased demand for rental property repair supplies", writes Enoch, and this bolsters the idea that rental properties are being renovated and perhaps receiving some overdue maintenance.

   There is also some higher-level info that bolsters the increase in remodeling, and that info comes from the BuildFax Remodeling Index. This index, according to Glenn Mandel of Red Fan Communications, indicated that "national remodeling activity reached a record level in June".

   Come to think of it, for the past couple of years, even during the Spring and Summer, the usually super-crowded Home Stores (Home Depot, Lowes, etc) had been relatively "empty", but over the same span of time for this year, the crowds have certainly returned. This could be a good thing. What do you think?

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Have a Great Weekend, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #homeremodeling #repair #rentalproperty #homeowners #HomeDepot #Buildfax

August 24, 2011

Young Inventory Translates To Quick Markets

Good Morning Folks,

   As we all know, there are a wide variety of measures and indices that gauge the health of the Real Estate market. One of the most important of there are the New Residential Sales figures, which incidentally, were up 6.8% from July 2010 to July of this year.

   Another such measure, and quite an interesting one, is one that was recently discussed in an article on Inman News ("11 fastest-moving real estate markets in July"). As described in the article, "Realtor.com released a list of metros with the lowest median age of inventory at the site -- a measurement of how long a property from a given metro area typically spends on the site". Essentially, the logic is that if homes are not sitting in inventory for too long while waiting to be sold, this indicates quick turnover, and thus, a fast-moving market.

   The biggest winner in this category, per the Realtor.com site, was Denver (median age of inventory was 32 days, which was the lowest among the Metros). Additionally, 6 California metros appeared in the list, and Detroit made the list, which is a good sign for their struggling Housing Market.

   Now, the converse of this measure would be the Metros with the highest median age of inventory, thus, slow-moving markets. The slowest one? Naples, Florida, with the highest median age of 153 days. Naples was not lonely in the list, as 7 of the 10 Metros tagged as the slowest-moving markets were in Florida.

   Inventory data is definitely not a new concept, but when it is examined from this perspective, it certainly paints a picture of the markets that are moving, shaking, and in some cases, sleeping.

   What are your thoughts/comments on this?

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Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
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TAGS: #RealEstate #NewResidentialSales #inventory #Realtor #California #Detroit #Florida

August 21, 2011

Sweet Deal? $16 For a $300,000 Home?

Hi Everyone,

   Welcome back !
   Well...Chalk this one up under the topic of "Oddball Topics!".

   Some guy in Texas walked paid a $16 filing fee and moved into an abandoned foreclosure home...and he is well within his legal rights to stay. According to a story by Stephen Clark, titled, "Texas Man’s $16 Property Seizure Throws Obscure Law Into Spotlight", the man used a legal maneuver known as "adverse possession", which "allows individuals to take property considered abandoned", is an old law on the books of most states, and dates back to the 1800's and British common law.

   Basically, as Clark writes, it was originally used to "deal with the boundaries of farmlands that weren't always clear". Larry Morandi, director of state policy research for the National Conference of State Legislatures, called it "kind of a quirky doctrine" designed to acknowledge that if you got "possession of a property and no one's been challenging it, you should have some type of title to it". But, nowadays, the concept has led to abuses, and as Clark writes, some scam companies have formed to seize properties and rent them out. Basically, a function of the sluggish economy and the increase in foreclosures.

   In this specific case in Texas, if this guy stays in the house for 3 years, he can obtain the title and become the owner. It's true! Some states can take 20 years, so he chose the right state to do this!

   Is he really safe there? Apparently, he told the news that the owner would have to pay off a "massive mortgage debt", and the bank would need to file a "complex lawsuit" (he does not see this happening). It seems that he did his homework, since he put up "no trespassing" signs, and therefore, the police cannot remove him since it's a "civil matter, not a criminal one."

   Some states are cracking down, but only Florida and Washington state have passed laws "tightening the requirements for claiming property through adverse possession." In Colorado, there was a change that allowed judges to force the adverse possessors to "compensate the original owners for back property taxes and interest". The crackdowns failed in many other states, which I find very odd, don't you?

   Apparently, Clark writes, "as long as it's in the open, it's not a crime", and adds that adverse possessors can even "register the bills in their name and notify the bank, previous homeowner or neighbors of their intent."

   This is definitely something that is hard to wrap your mind around. It's something I am sure most of us are not familiar with. What are your thoughts on this?


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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #abandoned #foreclosure #Texas #adversepossession #Britishcommonlaw #mortgagedebt

August 18, 2011

The Bounce Continues, As Well As The Tug of War

Hi Folks,

   Friday has arrived, and not a moment too soon !

   OK, on Wednesday, we discussed the jump in Building Permits, Housing Starts, and Housing Completions from July 2010 to July 2011. In our summary from that Blog Post, we said; "To gain a better assessment on that very important piece of the market, we will have to see what the National Association of Realtors (NAR) posts for their Existing Home Sales Index for July". Those numbers were just released, and "the trend is our friend", as the saying goes.

   Existing Home Sales are up "Strongly From a Year Ago", says the National Association of Realtors® (NAR), in their Press Release. By the Numbers, Existing Home Sales are 21% above July 2010. Regionally, the big winner was the Midwest, which was 31.3% above July 2010, but all Regions posted double-digit gains from July 2010.

   Lawrence Yun, NAR chief economist, made a very interesting comment as to the tug and pull (I call it Tug of War), that is holding back a full-blown recovery vs. and uneven recovery. Yun said that even though the "“Affordability conditions this year have been the most favorable on record dating back to 1970", the issue is that many buyers are being "held back because banks are offering financing to only the most highly qualified borrowers, ignoring a large share of otherwise creditworthy buyers,”. Ron Phipps, NAR President and broker-president of Phipps Realty in Warwick, R.I. says that an "unacceptably high number of potential home buyers" are unable to complete transactions, and that “For both mortgage credit and home appraisals, there’s been a parallel pendulum swing from very loose standards which led to the housing boom, to unnecessarily restrictive practices as an overreaction to the housing correction”. Thus, the "Tug of War".

   We found out this week that since July of last year, Permits, Starts, Completions, and sales of Existing Homes have all increased substantially. What's next? New Residential Sales for July will be released next week, and it will certainly be important to analyze these figures. What do you think? Is this good news?


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Have a Great Weekend, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com


TAGS: #ExistingHomeSales #NAR #BuildingPermits #HousingStarts #HousingCompletions

August 16, 2011

Housing Permits, Starts, And Completions All Rise

Hi Everyone,
   Hope you're having a productive and peaceful week. I come to you with some good housing news today!

   For the 12 months spanning July 2010 through July 2010, the 3 components of the New Residential Construction Housing statistics all showed an increase.

   From July 2010 through July 2011, Privately-owned housing units authorized by building permits jumped 3.8%, Privately-owned housing starts jumped 9.8%, and Privately-owned housing completions rose 9.5%, per the U.S. Census Bureau and the Department of Housing and Urban Development.

   What does this mean?

   This paints an overall picture of increased real estate activity from the same period a year ago. My opinion - this is a good thing. However, we are still sitting on a large inventory of existing homes, with a large percentage of that inventory as foreclosure/short sale properties. To gain a better assessment on that very important piece of the market, we will have to see what the National Association of Realtors (NAR) posts for their Existing Home Sales Index for July (due out Thursday Morning).

   Please Stay Tuned !

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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #residentialconstruction #buildingpermits #housingstarts #housingcompletions #realestate #foreclosure #shortsale

August 14, 2011

Danger Alert - For Anyone Showing Homes

Hi Folks,

   Hope You had a nice weekend, and welcome back.

   Today will be more of a Public Service Message, and it serves as a warning to anyone showing a home to relative strangers, male or female.

   "The attempted kidnapping and near sexual assault of a female Jackson real estate agent on Wednesday has reminded those in the industry about the dangers of their profession". This was taken from a recent story published in the JacksonSun website in Tennessee, written by Ned B. Hunter.

   The agent was showing a home to a man in the late afternoon, when he grabbed her and tied her up and put her in a closet, then left with her cell phone and purse. Fortunately, she was able to escape and call the police, resulting in the arrest of the suspect. She was very lucky, since it could have ended a lot worse for her.

   Earlier this year, I wrote a story in this Blog titled, "Home Security When Selling or Residing", in which we discussed these dangers. Jennifer A. Chiongbian, SVP and Licensed Associate Broker with Rutenberg Realty in New York City, suggests that you let your friends and neighbors know when you are showing a home. She also added another tip regarding your friends and neighbor; "have them call you afterwards to make sure everything is okay."

   Bottom Line...Be careful. You might be showing a lot of homes each day, but please don't get so entwined in the process that you overlook your safety and security. Any helpful suggestions for our friends here?


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Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #realestateagent #danger #showingahome #Jackson #Tennessee

August 11, 2011

Homebuyers, Homebuyers...Please Come Back!

Hi Everyone,
   It's Friday, and I'm glad to have you back!

   Sometimes it fascinates me to see the ripple effect of the Economy (specifically, Housing and Employment). When Housing and Employment are in turmoil, some crazy things happen, for example...the creation of modern-day Ghost Towns...yes, Ghost Towns.

   According to a recent story on 247wallst.com ("The Eight States Running Out Of Homebuyers") by Douglas A. McIntyre, Michael B. Sauter, and Charles B. Stockdale, "Parts of Oregon, Georgia, and Arizona have become progressively more deserted.". As a matter of fact, they said that the "single biggest problem in the U.S. real estate market is simple: There are very few homebuyers.", and referred to a “buyers’ strike”.

   In order to find the hardest-hit states, 24/7 Wall St. used 6 factors which ranged from vacancy rates, foreclosure rates, unemployment rates, construction figures, population changes and price reductions.

   The Eight States that wound up on their list were Michigan, Nevada, Arizona, California, Illinois, Georgia, Oregon, Florida. Michigan had the worst Population Change (Decrease) from 2005-2010, which would have been substantially impacted by the car industry bankruptcies.

   Some other facts regarding the other states that were analyzed: Nevada had the worst 2010 Foreclosures, the worst Unemployment, and the worst decrease in Building Permits 2006 to 2010. Florida had the 2nd worst vacancy rates. Two states that did not make the list were Colorado (had one of the worst foreclosure rates) and South Carolina (one of the worst vacancy rates), but they stated that the populations in both states have "rebounded enough to make a strong case that their housing markets may recover moderately over time."

   What happens now?

   As we discussed the other day in "Really? They Are Doing THAT To Foreclosures?", this story also mentions that some homes will be "torn down in these pockets of high foreclosures" to drop supply and boost prices. Outside of that spark of hope, they don't feel overly optimistic regarding these areas, since, "jobless rates may never recover" and little chance that the "populations in these areas will ever rebound." Thus...Ghost Towns for now, and who even knows how long.

   Do you live near a newly-deserted region? How does it feel? What are your thoughts from your first-hand observations?

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Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com


TAGS: #GhostTown #vacancyrates #foreclosurerates #unemploymentrates #constructionfigures #populationchanges #Michigan #Nevada #Florida

August 9, 2011

Really? They Are Doing THAT To Foreclosures?

Hi Folks,
   Happy Wednesday to you.

   As some of you may be aware, when a person cannot afford their home, it's very easy for late payments to start accruing, and the bank letters come, and all of those other ugly things.

   Before that, a homeowner can try and bring their mortgage current, do a Rent to Own, along with a few other salvage techniques. Ultimately, they may decide to short sale the home, if the price of the home is less than the outstanding mortgage(s). Additionally, they can walk away, and the home will ultimately go into foreclosure. At this point, it remains on the bank's balance sheet as an REO (Real Estate Owned), and the bank uses agents to try and sell the homes to recoup something to cover the losses.

   But this raises the question...what about the "Orphans"...the homes that won't even sell at substantial discounts. What do the banks do with these homes? Bulldoze them!

   "Increasingly, it appears banks are turning to demolition teams instead of Realtors to rid them of their least valuable repossessed homes", which comes from an article aptly titled, "Bulldoze: The New Way To Foreclose", written by Stephen Gandel for Time.com. As Gandel writes, "There are nearly 1.7 million homes in the U.S. in some state of foreclosure.". Now, with the market laws of supply and demand, if there are too many homes on market, prices stay low. Gandel poses the question, "But what if some of those homes never hit the market."? This could be good for the market.

   Just recently, per the article, Bank of America (BofA) announced "plans to demolish 100 foreclosed homes in the Cleveland area.", and most of there homes, according to a BofA spokesman, are "worth less than $10,000". How many so far? Approximately 100 in Detroit, 150 in Chicago, and more cities slated by end of year. It's not just BofA...Fannie Mae, Wells Fargo, and JPMorgan Chase were also mentioned.

   Why is this good? Who does this help?

   It's good for the banks since they no longer need to pay tax and upkeep, writes Gandel. They might even get a write-off for the donations.

   It's good for the local governments since they have the land donated back to them, and they get to develop it or use it as open space,

   The story says that "Housing economists like these deals because they remove homes from the market that would otherwise sell for a low price or not at all", which would drop prices (supply/demand).

   Gandel writes; "we are at the point where banks would be better off knocking down houses that reselling them", and adds that this shows there is "still something very wrong with the housing market." I find it very encouraging that banks are thinking outside the box to stir things up. What do you think?


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Have a Great Week, and Happy Rent-to-Owning !

Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #REO #foreclosure #shortsale #renttoown #repossessedhomes #mortgage


August 7, 2011

The Housing Market Vortex Postpones Retirement Plans

Hi Everyone,

   Hope you had a peaceful weekend. I spent the weekend ridding our home of any last remaining strains of the Strep virus so that our son may safely come back home and not have to deal with the joyous illness.

   So many times, we have heard the old "Gold Watch" story, about people who stay at a company for most of their life, retire with the company, and get a gold watch and a big send-off. As times have changed, and as that has become a story of bygone days, the lofty cushion that home equity has provided for people at the age of retirement is (or already has) gone the same route.

   In a recent story in USA Today ("Loss of home equity downsizes retirement for many"), author Sandra Block quoted an AARP survey that found "Nearly 32% of adults over age 50 say their home has declined substantially in value over the past three years". Block also adds a very important, yet strikingly true, comment from Jay Butler, an associate professor of real estate at the W.P. Carey School of Business at Arizona State University, who says that, "A lot of folks will postpone retirement."

   "Postpone Retirement?" Wow. It's amazing to even think about that after working hard your entire life !

   Looking even deeper into the ramifications, Block discusses health-care costs, which are quite expensive, as well as long-term expenses, which have been covered in retirement via the sale of a home with (substantial) home equity.

   The vortex and the fallout from the Housing Market is making retirement-age folks as well as younger homeowners re-evaluate their plans, and sadly, as Block says, it is "created a dilemma for seniors who are unable to live independently, or fear they will need help in the future". Some retirement communities (such as CCRCs - continuing care retirement communities), are emphasizing the "benefits of doubling up", says Block, which means that some centers are offering savings for sharing quites in the communities.

   The lesson we can learn from this is as follows: never take anything for granted, just as the "Gold Watch" story. Always make sure you have a contingency plan, and after that, make a contingency plan for your contingency plan...I am not kidding.

   What are your thoughts? Do you find this a frightening new reality of life?


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Have a Great Week, and Happy Rent-to-Owning !
Regards,
Rob Eisenstein
HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #homeequity #retirement #AARP #CCRC #downsize

August 5, 2011

Short Sale Requirements For Sellers and Buyers

Hi Folks,

   My apologies for the late post, but I am recovering from a week filled with Strep throat and a high-fever. Thankfully, I have done a sizable amount of my homework upfront, and was able to get this out to you as quickly as humanly possible.

   A comprehensive discussion on the topic of short sales must straddle both sides of the transaction - both sellers and buyers. Today, we will look at some requirements of both sides of Short Sales.

   In a recent article by Greta Guest for the Detroit Free Press titled, "Shortsales, longwaits: Buyers and sellers find process frustrating", Guest says that what you need to qualify in terms of paperwork and forms can "vary by lender".

   The three things Guest says that a homeowner would need to qualify for a short sale (according to the Certified Distressed Property Expert website) are:

* To show Financial hardship: Prove that "there is a situation causing you to have trouble affording your mortgage."
* To show Monthly income shortfall: Prove to a lender that "you cannot afford, or soon will not be able to afford your mortgage."
* To show Insolvency: "The lender will want to see that you do not have significant liquid assets that would allow you to pay down your mortgage."

   Now, let's discuss what needs to be done for those buying a short-sale.

   Jan Green, a Realtor with RE/MAX Excalibur in Scottsdale, AZ, who has processed short sales both on the listing side and purchase side, says that she counsels the buyers about short sales first, and says, "make sure they are pre-qualified; and what their time frame for closing is; do they have a house to sell?".

   Joseph Lam, a Real Estate Broker and a short sale listing specialist with Keller Williams Realty in San Jose, CA, who has been guiding sellers and buyers to get the transaction thru (approved) by the short sale lender, says that "Like any buyer in today's market, the buyer needs to get pre-approved for a home loan first." Lam names one of the requirements as verification of the buyer's downpayment (bank statement, etc.).

   Robyn Love, an agent and an investor with IRCA, who has done short sales on her own and with another negotiation service, also concurs that the "Buyers need to have been qualified from a bank" along with a downpayment. Green, Lam, and Love all add that patience is golden. These deals can take time !

   On the patience factor, Love says that Short sales, "especially when first listed, take several months to be approved.", and when an offer comes, the bank, "may or may not take their offer if it is too low." Love also adds that sometimes "if the foreclosure is months away, the bank won't move fast.", but, "If it's around the corner, the approval is faster."

   Some tips for Buying a Short Sale:

   Love says that usually, the bank is looking to minimize their loss, so a "low ball offer with no low comps or repairs will most likely be rejected.". She also says that pictures of repairs and low comps "help the bank make a decision".

   Green advises that when purchasing a short sale, to "garner all information as to the likelihood of a short sale closing before even putting" a buyer in her car.

   Additionally, Green says that she also interviews the listing agent before showing a short sale, and she asks, "if he/she has collected financial data, hardship letter, has seller consulted an attorney and CPA, does the seller have a true hardship (they might just be "trying" a short sale). "...what is the listing agent's experience in short sales."

   In Summary, short sales are wild-cards for now, until real legislation actually sticks..and yes, "HAFA" (Home Affordable Foreclosure Alternatives), we are talking about you !!

   Comments? Questions? Venting? (Venting allowed within respectable limits)

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HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #ShortSale #foreclosure #HAFA #hardship #insolvency #homeowner #prequalified #downpayment #comps

August 2, 2011

Amazing! A Real Estate Investing Social Game

Hi Everyone,
   Hope your week is going well !
   Well, it had to happen. It was a matter of time.

   A Golden Idea...yes, I'm talking about a Real Estate Investing Video Game !

   "Commonwealth Bank’s Investorville... Build a property portfolio without spending a cent". This is how the product was introduced in a Press Release from Commonwealth Bank in Australia.

   The program, Investorville", is billed as an "online simulation tool for budding property investors" as per the Press Release, and it operates in a "social game-like environment that uses gameplay to simulate scenarios", as per the story titled, "CommBank releases investment game", written by Laura Parker for GameSpot AU on ZDNet.com.

   Investorville is the product of both Commonwealth Bank and creative agency BMF, and incorporates market insights from RP Data. The game "mimics reality to provide people with real-time exposure to the property market, allowing them to make more informed property decisions.", per the Release.

   The game was created for both Existing Homeowners and also for those who already own an investment property. The online site is designed to be as, "fun and engaging as it is educational and informative.", says the Release, and it permits users to simulate "ongoing costs, without ever putting any of their own capital at risk".

   How does it work?

   Parker describes it as follows: Users start by making an online profile with personal relevant information on current budgets and existing real estate investments. Users can then search for investment properties in suburbs across Australia based on their target price; after a property is found, users will have a simulated 15-year period in which they must set rent, decide when to repair or renovate, and deal with events such as changes in interest rates, pay increases or decreases and bad tenants. Users can also choose to purchase more properties as the simulation advances, based on how well their investment is going.

   Mark Murray, General Manager Commonwealth Bank Consumer Marketing, explained "the rationale behind the development of Investorville" in the Release as follows: “Making the leap from owning your own property to buying an investment property can seem quite daunting to a lot of people. Investorville helps to break down common misconceptions and show the practicalities of property investment.", and adds that the, "really beneficial part of Investorville is that users can, in the true sense of the term, try before they buy", since, "The properties and data are reflective of the Australian property market and the types of properties available”. Aaron Michie, Interactive Concepts Director at BMF (the creators of Investorville), says the following regarding Investorville; "Investorville combines sophisticated economic modelling and real market data with a simple user-friendly gameplay to give people realism and simplicity.”

   The first real estate-oriented application that was developed by the bank was the "Commonwealth Bank Property Guide iPhone App", which was launched in 2010, and it uses "augmented reality to overlay data and tools onto the phone’s screen, providing property information on almost any premises the phone is pointed at"

   Does anyone out there think there is a version for the Wii or Xbox on the horizon? As silly as it may be for me to admit, I think it is a very good possibility.

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HomeRun Homes Blog: http://blogging.lease2buy.com
HomeRun Homes Websites: http://www.lease2buy.com and http://www.homerunhomes.com

TAGS: #RealEstateInvesting #socialgame #propertyinvestor #Australianproperty #iPhoneApp