It would be great for me if there were a ton more inventory coming. But, I look at these types of articles saying doom is around the corner as hearsay because there is no hard data to support their position. They could be right. They could be wrong. The inventory levels here are at 3 year lows. That is a fact I know based on real data. The post office did a vacant home study in May saying there were 24,000 vacant homes in the greater Sac area all the way from here to Stockton to Truckee to Yuba City. The definition of vacant was 90 days or more without picking up mail. That is another factual data reference. In placer county, 87% of all Trustee sales scheduled were postponed in August. In Sac County, 92% of all Trustee sales scheduled were postponed in August. Both of these, factual data points that are telling. In Placer County, 221 Trustee Sales were schedule for the month of August. In Sac County, 1224 Trustee Sales were set for the month of August. Total available inventory on August 31st was 8995 properties in the Tri County Area. That is down over 71% year over year. My investment group is in the middle of a study to find out exactly what the trends are from new inventory coming to market and will keep a running tally of that data.
My point, I hear a lot opinions given in the media without real data. Most of the chatter is broad stroke based on national data if any at all. It is also meant to keep the ratings up for the particular media outlet with the “story”.
I do my best to study the market here locally. It is impacted to an extent by national issues, but does not correlate to every national trend. Yes, there are vacant homes. How many exactly? Who knows. Are all of those already foreclosed on and waiting to hit the market? Doubtful. Even the 24,000 number in May does not break out bank owned or any property for sale at the time. Bottom line, it is more cost effective for the banks to slowly inject inventory in whatever manner they choose to do it (foreclosure or short sale). It is also more cost effective for them to NOT take in hard asset inventory.
What does it mean in my opinion… We will not see huge spikes in available inventory even if we see spikes in the default rate. We will and are seeing banks encouraging short sales because it keeps the homes occupied. Occupied homes are generally in better repair and have less chance of vandalism than non-occupied. Etc, etc… I hear all the terms of “shadow inventory” and over 7 million homes that the banks have in hold pens waiting to release onto the market and on and on, but where is the data? Where exactly are those homes? Which banks have them? It is all questionable info at best. It may be true, but there is more than an off chance that it may be inflated for a sensational impact. Either way, the banks will not do anything that they do not see as in their own best interest. A massive release of inventory or wave of foreclosures just doesn’t seem to me to be a strategic move that would be in their best interests today or in the near future.
I know, I did not address the broader economy and jobs and so on. It could all get worse. It could all stay the same. It could all get better. It is not relevant to whether or not banks have or do not have a huge amount of inventory. It is also not relevant as to whether or not it is in the banking sector’s best interest to release a huge wave of inventory even if they had it… Am I way off the reservation?
Tuesday, October 13, 2009
Wednesday, June 24, 2009
Short Sale vs. Foreclosure - Making an Informed Decision
What you need to know to make an informed decision
SHORT-SALE vs.FORECLOSURE
Ever wondered what difference it makes whether a home is sold as a short sale or if it is foreclosed on by the bank? Well, here are a few main points that will help answer the question for you. If you or anyone you know needs to list their home for sale, has further questions or would like to talk about the listings my team currently has on market -- Please call me at 916-580-6031. Thanks for reading my BLOG!! - Ken
Fannie Mae Guidelines Primary Residence
Short Sale:
Eligible for a Fannie Mae insured loan after 2 years, no restrictions.
Foreclosure:
Eligible with restrictions after 5 years, no restrictions after 7 years.
Fannie Mae Guidelines Non Primary Residence
Short Sale:
An investor who has done a short-sale is eligible for a Fannie Mae backed mortgage after 2 years.
Foreclosure:
An investor who has had a property foreclosed cannot get a Fannie Mae backed loan for 7 years.
Credit Score
Short Sale:
Late payments on mortgage will show after completion of the short-sale. The effect can be as short as 12 to 18 months. Depending on how the lender reports it, credit scores affected negatively 50 to 100 points.
ForeClosure:
Typically will affect credit score for at least three years. Scores will be negatively affected between 200 and 300 points.
Credit Application Questions (Form 1003)
Short Sale:
No questions regarding a short sale.
Foreclosure:
Question C, Section VIII: Have you had property foreclosured upon or given title or deed in lieu thereof in the last 7 years?
Credit History
Short Sale:
Depending on how lender reports, short-sales may not be reported on a credit history.
Foreclosure:
Remains as a public record for 10 years or more.
Security Clearance
Short Sale:
A short-sale does not usually raise red flags regarding security clearance.
Foreclosure:
Security clearances will usually be revoked, often times resulting in loss of employment.
Deficiency Judgment
Short Sale:
This is a negotiable issue between the Seller and the lending institution.
Foreclosure:
No negotiations between Homeowner and lending institution. It is up to the lender(s) whether to file a deficiency judgment.
Deficiency Judgment Amounts
Short Sale:
If there is a deficiency judgment, the amount is usually lower if the property has been sold through a short sale.
Foreclosure:
The foreclosure process usually will cost the lending institution more, hence resulting in a larger deficiency judgment if the judgment is filed.
Information obtained from sources that are deemed accurate, but have not been verified by Author. Information is subject to change. Individual effects may vary. All interested Persons should independently verify accuracy of the above information and seeking legal counsel is recommended.
Thursday, March 5, 2009
What is going on?? --- in Real Estate?
My Perspective by Ken PattersonThis edition of the post is going to be the simplest yet. With so much white noise going on these days it is hard to know what is real and what is misinformation or a flat out con by someone looking to take advantage of the tough economic times.
Have you seen those flyers or gotten a letter in the mail from some company claiming they will get your property taxes adjusted for a fee? I have gotten several of them. My favorites are those that tell me it is my “Last Chance to Act” or some other message used to make me feel compelled to send a check before I miss out. Well, please do not send any money. Your property taxes will be reassessed automatically regardless. If you are in doubt, call the county assessor to find out. (Sacramento County (916) 875-0700; Placer County (530) 889-4300) Live in a different county? Just go to Google.com and type in your county name followed by assessor.
How about those signs talking about “Prevent Foreclosure” or “Call for a Loan Modification”? - seen those? Or maybe you are considering “walking away” because you’ve heard that banks are not interested in loan modifications and you heard foreclosure is better than a bankruptcy. How about Short Selling your home? Or maybe buying a home that is a Short Sale? Do you know the facts regarding 1st time buyer incentives from the federal and state government?
Whatever your situation, please ask a trustworthy professional if you are in doubt about a life decision. A tax accountant, an attorney, a Realtor, a mortgage lender, a credit counselor are all resources that usually have at least a free 1st consultation. All have a fiduciary responsibility to give accurate answers and direction that is in YOUR best interest.
Whatever your situation, please ask a trustworthy professional if you are in doubt about a life decision. A tax accountant, an attorney, a Realtor, a mortgage lender, a credit counselor are all resources that usually have at least a free 1st consultation. All have a fiduciary responsibility to give accurate answers and direction that is in YOUR best interest.
If you would like more facts about any of the topics above, please contact me ASAP.
Wednesday, February 25, 2009
The President's Speech Last Night - Highs and Lows
Well, everyone has an opinion about our newest President it seems. Everyone also seems to have an opinion about the current economic situation too. The facts regarding either can be fairly unclear considering most every "NEWS" channel or "NEWS" report is chuck full of opinions and comments. Sometimes I wonder how much more qualified the "Hosts" and "Reporters" are than anyone one of us to be on the television. Does anyone else feel a bit dismayed at what is being said and by whom?
Well, I watched most of the speech last night and can say that I AM PROUD of MY COUNTRY! Though I do not agree with everything the President said or wants to do and did not vote for him, I think he did very well.
What I liked from his speech is that he gave me a few bits of "Assurance" that the United States of America can and will come out of this and any other hard time even strong than before. He also said that he was going to hold folks accountable inside both government and the private sector. Lack of accountability or a relative few is what started our recent economic tumble in my opinion which has in many cases created hardships for those who have been responsible as well as accountable. I also liked that he referenced times in our past where government did positive things by spending money during hard times that did result in sustainable advantages for the country. Two examples I remember are the transcontinental railroad and the system of high schools around the country. Sometimes people like me who do not like even saying the words "Bigger Government" forget about some of the focused projects that led to very good things.
What I did not like was that I don't believe that his friends or foes in government will be held accountable for anything. The voters have not held them accountable as proven by the huge percentage of incumbents continuously being re-elected. So, it is difficult to believe that he will. As for the private sector, it seems they are very cozy with the elected and appointed officials tasked with holding them accountable. Tough to see how this type of situation could result in anything other than rampant self enrichment and the ethical low road we've seen to be the norm on Wall Street as well as in the Board Room. Call it the "Old Boys Network" or "Cronyism" or whatever you like, but it seems the result is CEO's and board members don't need to perform to be paid which makes losers out of shareholders and employees. Lastly, I do not like generalizations of people such as the one heard all the time, "All the people who bought homes they knew they couldn't afford". I feel that there are so many different personnal situations in the real world that exist.
All the rest, we will see how things go! Stay positive out there! It will get better for us all soon! Take that to the bank!
Well, I watched most of the speech last night and can say that I AM PROUD of MY COUNTRY! Though I do not agree with everything the President said or wants to do and did not vote for him, I think he did very well.
What I liked from his speech is that he gave me a few bits of "Assurance" that the United States of America can and will come out of this and any other hard time even strong than before. He also said that he was going to hold folks accountable inside both government and the private sector. Lack of accountability or a relative few is what started our recent economic tumble in my opinion which has in many cases created hardships for those who have been responsible as well as accountable. I also liked that he referenced times in our past where government did positive things by spending money during hard times that did result in sustainable advantages for the country. Two examples I remember are the transcontinental railroad and the system of high schools around the country. Sometimes people like me who do not like even saying the words "Bigger Government" forget about some of the focused projects that led to very good things.
What I did not like was that I don't believe that his friends or foes in government will be held accountable for anything. The voters have not held them accountable as proven by the huge percentage of incumbents continuously being re-elected. So, it is difficult to believe that he will. As for the private sector, it seems they are very cozy with the elected and appointed officials tasked with holding them accountable. Tough to see how this type of situation could result in anything other than rampant self enrichment and the ethical low road we've seen to be the norm on Wall Street as well as in the Board Room. Call it the "Old Boys Network" or "Cronyism" or whatever you like, but it seems the result is CEO's and board members don't need to perform to be paid which makes losers out of shareholders and employees. Lastly, I do not like generalizations of people such as the one heard all the time, "All the people who bought homes they knew they couldn't afford". I feel that there are so many different personnal situations in the real world that exist.
All the rest, we will see how things go! Stay positive out there! It will get better for us all soon! Take that to the bank!
Wednesday, February 11, 2009
Dear Buyer - Why am I so excited you ask?
I'm pretty excited because inventory continues to get swallowed up (even though you may see a few stragglers out there) by investors and other buyers to the point it has driven inventory down farther than it has been in our area for 3 years! That demand has remained constant and even through all the drama of the economy and the government/ bank issues. The good inventory is being hit with multiple offers very quickly in many areas in Placer, Sac, El Dorado, Yolo and San Joaquin counties. I attend various investor groups throughout the month and many others feel we are at now or very near the bottom. Everyone has a different perspective as to why, but most feel we are there. I too feel we could very well be at the floor. I think we may see prices dip for a month here or there over the next 18 months and then recover back to that floor. Appreciation won't happen again for awhile unless inflation has an impact, but "value" is the important factor (a.k.a - How many loaves of bread will your house buy you when you sell it?). You probably won't get any extra "bread" for your property for some time.
On top of all that, rates are VERY low. The Fed will not let the rates on treasuries or on Fed Funds remain low once economic recovery begins because they will fear inflation. Do you disagree?
All that said, I think it is time to strike NOW if the deal is right. It is no longer a waiter's market. It is definitely a buyer's market in my mind. It could become a seller's market faster than anyone may think if I am reading the tea leaves correctly. For example - Banks are hold firm on prices and getting them. They are also tightening up their terms with requirements for lower and lower inspection periods with higher and higher Earnest Money requirements. They are also ‘trickling" new foreclosures into the market instead of "dumping" them and creating a glut of inventory. What is it called when the Seller's start setting those types of terms? Seller's market? If all property on the market was conventional versus bank owned or short sale, it would be a Seller's market today... Lastly, I have heard a few of our area builders have started to purchase land tracts. They generally do not do that unless they are thinking about building on them.
I am writing more offers than ever! It is exciting times right now!! Let's find that RIGHT DEAL and get you in while the getting is good!!
Your Real Estate Agent
Kenpatterson@kw.com
On top of all that, rates are VERY low. The Fed will not let the rates on treasuries or on Fed Funds remain low once economic recovery begins because they will fear inflation. Do you disagree?
All that said, I think it is time to strike NOW if the deal is right. It is no longer a waiter's market. It is definitely a buyer's market in my mind. It could become a seller's market faster than anyone may think if I am reading the tea leaves correctly. For example - Banks are hold firm on prices and getting them. They are also tightening up their terms with requirements for lower and lower inspection periods with higher and higher Earnest Money requirements. They are also ‘trickling" new foreclosures into the market instead of "dumping" them and creating a glut of inventory. What is it called when the Seller's start setting those types of terms? Seller's market? If all property on the market was conventional versus bank owned or short sale, it would be a Seller's market today... Lastly, I have heard a few of our area builders have started to purchase land tracts. They generally do not do that unless they are thinking about building on them.
I am writing more offers than ever! It is exciting times right now!! Let's find that RIGHT DEAL and get you in while the getting is good!!
Your Real Estate Agent
Kenpatterson@kw.com
Tuesday, February 10, 2009
Are you an Investor and looking to aquire more Property?
Great News for Investors!!
Fannie Mae is changing their current limit of four financed properties per borrower when the mortgage being delivered to Fannie Mae is secured by an investment property or second home. They will allow “five to ten financed properties per borrower, with certain eligibility and underwriting requirements, including a 720 minimum credit score and 70–75% maximum LTV/CLTV/HCLTV (depending on the transaction and property type). The requirements apply to any investment property or second home loan being delivered to Fannie Mae, regardless of whether Fannie Mae is the investor on the borrower’s other mortgages. Second home and investment property loans to borrowers with five to ten financed properties will be accepted with purchase dates on or after March 1, 2009...
If you are thinking of investing, CALL KEN TODAY! 916-580-6031
Fannie Mae is changing their current limit of four financed properties per borrower when the mortgage being delivered to Fannie Mae is secured by an investment property or second home. They will allow “five to ten financed properties per borrower, with certain eligibility and underwriting requirements, including a 720 minimum credit score and 70–75% maximum LTV/CLTV/HCLTV (depending on the transaction and property type). The requirements apply to any investment property or second home loan being delivered to Fannie Mae, regardless of whether Fannie Mae is the investor on the borrower’s other mortgages. Second home and investment property loans to borrowers with five to ten financed properties will be accepted with purchase dates on or after March 1, 2009...
If you are thinking of investing, CALL KEN TODAY! 916-580-6031
Economic Bailout - Who Know What's in the Package?
Is it just me or have any of you noticed that most Senators and Congressmen/ Women simply state their "Party Line" when asked about this $827+ Billion spending package. And, have you listened when a reporter asks about particular line items or section?
I have heard several interviews on the radio last night and this morning that have me alarmed. I have heard things like "I don't believe that is what it says" and "If it says that, we will fix it" or "I will take a look when I get back to my office"... What??? Take a look? Those same elected leaders say, "I am going to vote for this because we MUST do something" or "This package is WAY TOO big that I cannot vote for it".
Again, is it just me or does it seem like these officials STILL do not have a clue as to what they are doing or the potential impact their action/ inaction is going to have? I submit they would not admit to what REAL impact their past actions/ in-actions have had on the current state of things. Am I the only person that feels as though you, Joe the Plumber and I are the ones having to take accountability for the actions of those in power? In some cases, I will take that accountability as a voting citizen. It would be nice to have someone that doesn't blame the other side or the past President. It would be nice when someone is caught dead to rights in the wrong to for once have them admit - YES, I made a mistake or a bunch of mistakes. Or better yet - "since no one will fire me, I am stepping down. It is the right thing to do."
I love my Country! We will get through this and come out better than ever. Please hold our leaders accountable for the actions and leadership, not for what they will "give" away. JFK said, "Ask not what your Country can do for you, but what YOU can do for your Country." I dearly hope that our leaders and citizens hear that call to action as we step through the current economic valley.
Just my perspective... Thanks for reading!
Visit Team Patterson's Homepage
I have heard several interviews on the radio last night and this morning that have me alarmed. I have heard things like "I don't believe that is what it says" and "If it says that, we will fix it" or "I will take a look when I get back to my office"... What??? Take a look? Those same elected leaders say, "I am going to vote for this because we MUST do something" or "This package is WAY TOO big that I cannot vote for it".
Again, is it just me or does it seem like these officials STILL do not have a clue as to what they are doing or the potential impact their action/ inaction is going to have? I submit they would not admit to what REAL impact their past actions/ in-actions have had on the current state of things. Am I the only person that feels as though you, Joe the Plumber and I are the ones having to take accountability for the actions of those in power? In some cases, I will take that accountability as a voting citizen. It would be nice to have someone that doesn't blame the other side or the past President. It would be nice when someone is caught dead to rights in the wrong to for once have them admit - YES, I made a mistake or a bunch of mistakes. Or better yet - "since no one will fire me, I am stepping down. It is the right thing to do."
I love my Country! We will get through this and come out better than ever. Please hold our leaders accountable for the actions and leadership, not for what they will "give" away. JFK said, "Ask not what your Country can do for you, but what YOU can do for your Country." I dearly hope that our leaders and citizens hear that call to action as we step through the current economic valley.
Just my perspective... Thanks for reading!
Visit Team Patterson's Homepage
Tuesday, February 3, 2009
Good News from the AP!!... AND it is about the Real Estate Market!!
This acticle has some "Good News"! Could it be that things may in fact be working themselves out as free markets always do? How can it be that there is good news about the economy before the "TRILLION Dollar Spending Act" is past. No, I don't think that is what it will really end up being named, but everyone reading knows what I am referring too, right?...
Funny, the reporter that wrote the article could not even get throught the entire 2 sentences of the 1st paragraph before making a comment "...analysts cautioned that the economy will keep showing fresh bruises in the coming months...". I, for one, am a little worn out with the drama of the "Bad News" always being reported. It is a litle like beating the dead horse. Additionally, I wonder about the advice those in power are getting about what is currently going on in the real world. When I hear things like, "We want to let people refinance at 4.0% along with 1st time buyers..." it really makes me concerned because a good number of folks I know cannot refi due to the current value of their home being less than the principle balance to be refi'd. Anyway... I could go on as I'm sure you can too.
My purpose in writing tonight is to simply say, "LOOK!! There IS some GOOD NEWS!" Thanks for reading!
Ken @ teampatterson.yourkwagent.com
Funny, the reporter that wrote the article could not even get throught the entire 2 sentences of the 1st paragraph before making a comment "...analysts cautioned that the economy will keep showing fresh bruises in the coming months...". I, for one, am a little worn out with the drama of the "Bad News" always being reported. It is a litle like beating the dead horse. Additionally, I wonder about the advice those in power are getting about what is currently going on in the real world. When I hear things like, "We want to let people refinance at 4.0% along with 1st time buyers..." it really makes me concerned because a good number of folks I know cannot refi due to the current value of their home being less than the principle balance to be refi'd. Anyway... I could go on as I'm sure you can too.
My purpose in writing tonight is to simply say, "LOOK!! There IS some GOOD NEWS!" Thanks for reading!
Ken @ teampatterson.yourkwagent.com
Friday, January 30, 2009
Investing in Real Estate? Are you asking the Right Questions?
If you were to advise a friend, family member, client or just someone you didn't know who was considering buying an investment property, what is the top question you would advise them to ask themselves before making the investment.
For Example: What is the goal you are trying to achieve? or Do you have the financial resources? or How much debt load are you comfortable with? or Do you know the steps in purchasing an Investment Property? ... ...
I am very interested to hear what you all think! I have 99 Questions that I believe are very good ones that will be published very soon with a short guide on how to answer each question... Let me know if you are interested in a copy and I'll let you know how to get one once production starts!
Have a great day!!!
For Example: What is the goal you are trying to achieve? or Do you have the financial resources? or How much debt load are you comfortable with? or Do you know the steps in purchasing an Investment Property? ... ...
I am very interested to hear what you all think! I have 99 Questions that I believe are very good ones that will be published very soon with a short guide on how to answer each question... Let me know if you are interested in a copy and I'll let you know how to get one once production starts!
Have a great day!!!
Thursday, January 29, 2009
New Home Starts in Sacramento - Do we really NEED them?
Seems to me that part of the housing problems facing the market today originated from overzealous builders partnered with more than "aggressive" lender types. What do you think? A high percentage of the bank owned properties on the market today have been built in the recent past and purchased from Builders using their "preferred" lender. For my money, the government may want to be more careful than in the past when issueing building permits for new homes... Just my perspective.
Seems to me that part of the housing problems facing the market today originated from overzealous builders partnered with more than "aggressive" lender types. What do you think? A high percentage of the bank owned properties on the market today have been built in the recent past and purchased from Builders using their "preferred" lender. For my money, the government may want to be more careful than in the past when issueing building permits for new homes... Just my perspective.
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