Property Crossroads - Real Estate Info

May 16th, 2008

Are real estate agents becoming more professional?

A lot of people look at real estate agents as barely a step above used-car salesmen or lawyers.

But a new survey suggests that most agents don’t deserve such poor standing among customers.

The survey, conducted by the National Association of Realtors, says that a greater number of real estate agents are earning additional professional designations. To earn these designations — which agents usually list as various initials after their names — Realtors must take several classes and pass tests. In other words, they must study up on their business.

Officials with the National Association of Realtors say that this is good news for consumers. Agents who have taken additional classes know more about the ins and outs of selling homes. This can only benefit the buyers and sellers with whom they work.

Of course, you’d expect the association to say this kind of thing. The association exists, after all, to promote the benefits of working with Realtors. But in this case, the association speaks the truth.

I interview a lot of real estate agents. Despite the public’s opinion, most of them are smart, talented hard-working people. And most of them work hard to make sure that their clients make the best real estate decisions.

Yes, there are some agents who don’t deserve your respect. But that’s the case in any profession. Durign this housing slump, Realtors have been portrayed as greedy, selfish and corrupt. Again, some of them are. But the vast majority are simply trying their best to reach the best deals for their buyers and sellers.

Share This

By Dan -- 0 comments

May 15th, 2008

Will houses finally get smaller?

For years, the size of the average U.S. house has grown. But a story by Stephen Gandel on CNNMoney.com, which you can read here, says that a combination of rising fuel costs, an aging population and a growing environmental movement may result in the opposite: Our average homes may soon be getting smaller.

According to the story, the average house checked in at slightly more than 1,600 square feet in the late 1970s. That has risen to nearly 2,300 square feet today.

The CNNMoney.com story, though, posts several reasons why this may change. Baby Boomers are getting older. Their children are moving out on their own, so they don’t need as much living space. Rising fuel costs may encourage smaller homes; It takes a lot of fuel to heat those king-sized mansions.

And don’t discount the movement toward green, environmentally-friendly building. It’s hard to call a home “green” when it covers 3,000 or more square feet of living space, no matter how many energy-efficient appliances it boasts.

Personally, I find the movement toward small homes refreshing. My family and I — which just this week grew by one member, by the way — are quite happy living in a small house, one that includes about 2,100 square feet. There are only four of us, plus one dog. We have more than enough space.

What about you? Do you live in a large home? If so, are there rooms you rarely, if ever, use? If you live in a small home, do you want more living space? Could you use that extra bedroom or den? Or are you satisifed with the size of your house? Let me know. I’d be happy to hear from you.

Share This

By Dan -- 0 comments

May 14th, 2008

Commercial/multi-family business going strong

It’s hard to find anything positive to say about the residential real estate market. That’s not the case, though, with the commercial and multi-family side of the real estate industry.

According to a recent story by the Mortgage Bankers Association of America, which you can read here, the commercial/multi-family end of the mortgage-financing business grew 19 percent in 2007. Mortgage bankers closed $507.7 billion worth of commercial/multi-family loans during this time.

This side of the lending business saw this big gain even with the credit crunch hitting the real estate business in the middle of 2007.

Share This

By Dan -- 0 comments

May 13th, 2008

Where not to move: Cities facing biggest housing price declines

There are a lot of reasons to move to Las Vegas. If you’re looking to invest in residential real estate, though, you’d best stay away.

Las Vegas topped a dubious list last week, ranking as the city experiencing the largest drop in housing prices, according to a story on SmartMoney.com written by reporter AnnaMaria Andriotis.

According to the story, home values in Las Vegas have fallen 24.5 percent from their peak, the largest drop in the nation.

Of course, Vegas isn’t the only city experiencing major declines in housing value. Miami, Phoenix, Los Angeles and San Diego all joined Sin City on SmartMoney’s list.

Share This

By Dan -- 0 comments

May 12th, 2008

A glimmer of good news: Remodeling holding steady

We’ve all been inundated with the bad news from the housing industry: Home sales are down. Foreclosures are up. Housing prices are dropping or are stagnant. Home builders are going out of business.

It’s depressing. I know.

So how about a small piece of good news? Here it is: According to the National Association of Home Builders, home remodeling work remained steady in the first quarter of this year.

Of course, this news isn’t all stellar. The amount of remodeling work is still down from the days of the real estate boom. And economists with the home builders’ association say they don’t expect remodeling to begin bouncing back to pre-slump days until a gradual recovery begins in 2009.

Still, the remodeling industry is providing some boost to a very weak home building business. For that, at least, we should be grateful … at least a little bit.

Share This

By Dan -- 0 comments

May 11th, 2008

Is Congress wasting its time, again, on housing aid?

Last week, the U.S. House of Representatives passed a plan that would provide $300 billion in housing aid to help refinance mortgage loans for homeowners facing foreclosure.

This is a nice step. Foreclosures, after all, are a huge drain on our economy. They also drag down property values in their surrounding neighborhoods.

The bill now goes to the Sentate for its consideration.

Problem is, even if the bill passes the Senate, what good will it do? Pres. Bush, whose administration has done little to either prevent the housing crisis or help bring it to a quicker end, has already vowed to veto the bill if it passes.

Maybe the members of Congress will be able to scratch out some compromises to come up with a bill that the president won’t veto. It’d be nice to see the government actually do something to help regular people. And, yes, many homeowners facing foreclosure did bring their troubles on themselves. But many more face losing their house because of matters out of their control. Let’s face it, not many of us could continue making our mortgage payments if some unforeseen catastrophe befell us: job loss, illness, these are the two that can lead even responsible homeowners to foreclosure.

Why doesn’t our president, and several members of Congress, support this bill? They fear that it is a bailout for irresponsible borrowers and speculators.

This bill would undoubtedly help some people who probably don’t deserve any help. But it will also help a whole lot more people who do deserve some assistance. Why has our country become so cold-hearted? Isn’t it a fair tradeoff to help some who are undeserving if we can prevent hard-working families — at least some of them — to avoid losing their homes?

Share This

By Dan -- 0 comments

May 9th, 2008

California senate takes aim at real estate fraud

California senators yesterday voted to channel more funding toward the investigation and prosecution of real estate fraud in their state.

You can read about the measures in this story in the Los Angeles Times by reporter Patrick McGreevy. Senators, according to the story, say that mortgage fraud is one of the main factors in the explosion of foreclosures in the state.

Here are some numbers: According to the story, Los Angeles County investigated and prosecuted real estate fraud cases last year in which victims lost $13.4 million. This year already — with the year not even half over — Los Angeles County officials have investigated fraud cases involving $18.4 million in losses.

To combat the growth in fraud cases, the California senate voted to allow state counties to increase the fees for filing property purchase documents. These extra fees would be spent on supporting the real estate fraud-investigation untis throughout California.

This is a good move. States need to be serious when pursuing mortgage fraud. Having properly funded investigation and enforcement units is the best way to do this. 

Share This

By Dan -- 0 comments

May 8th, 2008

Countrywide in trouble again

Throughout the subprime lending crisis and as foreclosures across the country soar, few mortgage companies have taken heat like Countrywide. Arguably once the most powerful lender in the country, Countrywide has become a favorite of critics, teetered on the verge of bankruptcy and was eventually acquired by Bank of America.

The big problem? Countrywide relied too heavily on subprime loans. The company also made a scores of questionable loans, ones that borrowers struggled to repay. Depending on whom you talk to, Countrywide lenders should have realized that many of the loans they were making were bad ones.

Now, in this story written by Peg Brickley of the Wall Street Journal, Countrywide is again in the news, and again it’s for all the wrong reasons. A Pittsburgh resident is suing Countrywide, accusing the lender of using fabricated evidence in its effort to start foreclosure proceedings on her house.

According to court documents, the homeowner was up to date on her mortgage payments, but Countrywide still threatened to start the foreclosure process if she didn’t pay thousands of dollars more in fees. Countywide later backed off — wisely — and offered to pay the homeowner’s lawyers. But that hasn’t been good enough for the homeowner. She says her credit has been permanently damaged by Countrywide’s foreclosure attempt.

Earlier this week, a bankruptcy court judge rejected Countrywide’s proposal to settle the allegations. Judge Thomas Agresti of the U.S. Bankruptcy Court in Pittsburgh, says he wants to know more about the allegedly false documents that Countywide created.

Does the lawsuit against Countrywide have merit? I can’t say. But I can say that it wouldn’t surprise me. We’ve seen throughout the mortgage industry’s subprime mess, that many — not all, of course, but many — mortgage lenders did not watch out for the consumer. Many lenders got greedy. They pumped up the volume of their originations without first thinking of whether a particular loan was right for the borrower.

So if Countrywide did act improperly in this case, it wouldn’t surprise me a bit. And I’m not just picking on Countrywide here. I wouldn’t be surprised if any lender acted improperly. After all, I can only go by their track records.

Share This

By Dan -- 0 comments

May 7th, 2008

Are lenders doing enough to help homeowners facing foreclosure?

The U.S. Treasury Department is in the midst of asking — some would say demanding — that mortgage lenders adopt a new set of uniform, but voluntary, rules that would make it easier for them to modify mortgage loans that homeowners can no longer afford.

A group of 10 lenders have formed project Hope Now, an organization dedicated to helping homeowners who are facing foreclosure. The big question is whether mortgage lenders have done enough: Mortgage lenders have reworked more than 502,000 loans through Hope Now in the first three months of this year.

Some say that’s great. Others ask what’s taking the mortgage lenders so long.

The key thing to keep in mind is that no one benefits from a foreclosure: Not banks, mortgage firms, the public or, of course, homeowners. Bickering about whether mortgage lenders are the main cause of the rising number of foreclosures or arguing over whether they’re moving too slowly to help is not productive.

Instead, government officials and mortgage lenders need to work side-by-side to not only slow the number of foreclosures spreading across the country but to make sure that another mortgage crisis isn’t just five, seven or 10 years away.

Share This

By Dan -- 0 comments

May 6th, 2008

Real estate slump not nearing an end

If there’s one question I’m asked as a real estate writer more than any other, it’s the obvious one: When is the housing slump going to end?

Unfortunately, I don’t have a good answer. No one does.

There are predictions, though. And, unfortunately, they’re not happy ones.

Take a look at this story in the Wall Street Journal’s online edition. Written by June Fletcher, it says that, according to economists gathered at the spring construction forecast held by the National Association of Home Builders, the housing market won’t show signs of improvement until early next spring, at the earliest.

The statistics aren’t good. Homebuilders have slowed new construction to a crawl. Existing homes for sale are sitting on the market for months and months. Housing prices in several parts of the country are either stagnant or dropping.

This is all depressing, I know. But if you aren’t planning to sell in the next five to eight years, you can relax. The residential market is a deep slump now, for sure. But real estate markets change. If you don’t have to sell any time soon, you’ll be fine. You’ll still make money on your house sale.

And if you do have to sell now? Be prepared to break even or, unfortunately, lose a bit of money. It’s unfortunate, but it is a reality. This market is a terrible one in which to sell.

Share This

By Dan -- 0 comments