With a new decade just begun, it’s interesting to look back at where we’ve been these past 10 years. In 2002, there were 1023 single family homes sold in the Truckee/Lake Tahoe area, with a median price of $397,500. By 2006, we reached the peak of market value, at a median price of $680,000. Now, at the end of 2009, we’re down to a median price of $512,000, a total decrease of 25% in median value from the high in 2006, yet a 29% increase since 2002. However, this year has also seen an increase in number of homes sold (787), up 20% from the low in 2008 of 655.
In looking at the Tahoe Donner subdivision in Truckee, which comprises the largest percentage of the sales in the overall area, the statistics are similar. In 2002, there were 302 single family homes sold, with a median price of $495,000. The highest median market value was reached in 2005, at $765,000. At the end of 2009, the median price is at $568,500, again, a 25% drop since the high in 2005, yet still a 29% increase from where we were in 2002. And similar to the picture for the entire area, the number of homes sold in 2009 in Tahoe Donner (225) was up 16.5% from 2008.
During the past year, we’ve seen our share of distressed properties come on the market, although not near as many as many areas of our state and country. Of the 787 single family homes that sold in 2009, 127 (16%) were foreclosures and 85 (11%) were “short sales”. We currently have only 23 foreclosure properties active on the market (3% of the total inventory available), and 102 “short sales”, comprising 14%.
As we look towards this new decade, we’re excited about the opportunities in our industry that will hopefully allow many more buyers to realize their dreams of home ownership, be it here in our mountain paradise, or wherever their dreams may take them.
The Washoe County Senior Services Senior Law Project is holding free foreclosure workshops this month for people who need help in keeping their homes. These workshops are open to the public.
The workshops are being held at Reno Center at 1155 E. Ninth Street in Reno.
Saturday, December 5th from 9am to Noon Saturday and Wednesday December 16th from 4pm to 6:30pm.
The goal of the events is to educate and empower people about what steps to take when attempting to modify their mortgage, the time frame of the foreclsure process, discussing common options that are available from your mortgage company and other options that may be available to you so you can retain your home.
For more information, email the Senior Law Project at slawproj@washoecounty.us. Space is limited to please RSVP at 775.328.2592.
As a Real Estate Broker, focused primarily on distressed property sales, I can honestly say that I have. August – October of this year I was just about as busy as I have ever been in the business of Real Estate. Most the people I chat with in Mortgage, Title, Inspection Services, etc. say the same thing. The transactions were typically affordable in nature but it was nice to see a lot of them. More importantly there was a sense of urgency in the market-place. In certain price ranges and neighborhoods demand clearly exceeded supply. When considering the following points I can’t help but feel as if another shoe is about to drop.
The extension and expansion of the credit has left some recent buyers wondering why they were in such a big hurry. Meanwhile some would-be buyers are feeling a little less confident. All are worried they will or have paid too much.
Housing demand is typically created by one or more of the following: Household formation, employment opportunities, attractive financing and the lure of home equity. All of these are lacking in my market.
I sense that many if not most of the recent first-time buyers would have eventually purchased a home regardless. The looming expiration of the tax credit served to get them of the fence. This created a somewhat false demand.
In short I do think we’ll suffer a bit of a hang-over this next year. As a generality banks are holding a bit firmer to their prices when dealing with fore-closed properties. I do expect interest rates to rise at some point. Short sales are just as mixed up as they ever have been. It will be interesting to see how things turn out for the big auto companies after the “cash for clunkers” revenue stops showing up on their bottom line. Perhaps an indicator for the near future in our housing market.
That said, if you’re in the market for a home now, don’t be too concerned. Your income should be secure. The monthly payment should be conservative in relationship to your income. It needs to be the right house at a fair price. If all those pieces fall in place, I say go for it. Prices will inevitably rise & fall and I think the joy of home ownership has been relatively under-rated lately. Planting a tree or shrub wherever you wish, knocking a hole in the wall to hang the family heirloom or driving down your street to the “best” house on the street; some things are priceless.
An REO (Real Estate Owned) is a property that goes back to the mortgage company after an unsuccessful foreclosure auction (also known as a Trustee’s Sale). Trustee Sales (often an auctions held on the courthouse steps) begin with a minimum bid that includes the loan balance, any accrued interest, plus attorney’s fees and any costs associated with the foreclosure process. In order to bid at a foreclosure auction, you must have a cashier’s check in your hand for the full amount of your bid. If you are the successful bidder, you receive the property in “as is” condition, which may include someone still living on the property. There may also be other liens against the property. Trustee’s Sales are typically advertised via local, public notices such as local newspapers.
Since what is owed to the bank is almost always more than what the property is worth, very few Trustees’ Sales result in a successful closing. If the Trustee’s Sale is unsuccessful the property reverts to the bank or loan servicer and is now considered REO, or “real estate owned” property.
The bank now owns the property and the mortgage loan no longer exists. The bank will handle the eviction, if necessary, and may do some repairs. They will typically negotiate with the IRS and local municipalities for removal of tax/municipal liens and they normally pay off any homeowner’s association dues. As a purchaser of an REO property, the buyer will typically receive “clear title” and the opportunity to thoroughly inspect the property. These are the properties buyers will typically see on MLS.
A bank owned property might not be a great bargain. Do your homework before making an offer. Make sure that the price you’re offering is comparable to similar homes in the neighborhood. Consider the costs of renovation. Last but not least, consider your loan type and down payment amount. Loans with high “loan to value” (small down payment) generally require that the home be in good condition.
A well informed real estate agent, representing the buyer exclusively is invaluable in such a transaction. There are many pitfalls and complications that can be avoided with such representation.
Dan Rider, an Owner/Broker of Dickson Realty, talks about Freddie Mac properties and the Homesteps program in the first part of our Freddie Mac series. Watch the video and learn what Freddie Mac and Homesteps is all about.
On July 1, 2009 Assembly Bill 149 was passed and signed into law. This new law requires the foreclosing trustee (company hired by the banks to foreclose) to provide mediation for any owner-occupied residential property before they can foreclose. Sorry investors, you won’t get to take advantage of this program. To get more information on this program you can visit http://www.nevadajudiciary.us/
The purpose of the Foreclosure Mediation Program is to keep Nevada homeowners in their homes. To qualify it must be an owner-occupied, primary residence. If you have a Notice of Default and Election To Sell filed on your home prior to July 1, 2009 you don’t qualify for this program.
Mediation is an alternative method to help parties resolve disputes by agreement with the help of trained mediators. Mediating a foreclosure action has its advantages. It is fast, inexpensive, and offers a flexibility that more formal processes do not.
The new law requires that a foreclosing trustee must include the following when they file the Notice of Default and Election To Sell (NOD) – (1) Contract information on how the homeowner can contact a person of authority to negotiate a loan modification, (2) Contact information for at least one local housing counseling agency approved by HUD, and (3) a form with the homeowner can indicate their election either enter into mediation or waive that option with envelopes addressed to the trustee and Mediation Administrator.
A homeowner must complete the mediation form no later than 30 days after service of the notice and return it by certified mail.
If the homeowner selects mediation the foreclosing trustee has to notify the beneficiary (the bank) and the Mediation Administrator who then assigns a mediator and schedules the mediation. At this point the foreclosing trustee can take no further action until the completion of the mediation.
Proposed Supreme Court rules limit mediations to four hours and require that mediations be conducted within 90 days of a foreclosure notice being filed. Those same rules also require that all decision makers be present for the mediations. That means, if an agreement is reached, it can be finalized quickly. The cost is $400 which is split between the homeowner and the lender, and it has to be paid up front.
Within 10 days of the mediation, the mediator will prepare the necessary Statement of Agreement or Non-agreement and serve it on the parties. The original will be filed with the Foreclosure Mediation Program Administrator and the mediation will be closed. If there is an agreement, the parties will execute the appropriate documents. If there is no agreement, the parties will be free to pursue other legal remedies.
This new law also gives the homeowner more time to “cure” the default by making back payments and re-instating the loan up to 5 days before the Trustee’s sale date. This has the effect of giving homeowners and additional 3 to 5 months to reinstate. The old law only gave 35 days from the date the Notice of Default was filed.
You can play a major role, with the help of a trained mediator, in deciding the outcome of your individual dilemma. Mediation is a give-and-take process in which the parties work to reach a mutually acceptable resolution to a mutual problem. Resolutions reached through foreclosure mediations are compromises that offer advantages to lenders as well as homeowners.
Clean, affordable foreclosure listings are a hot item in Northern Nevada. Inventory is low, prices are on the up-swing & multiple offers becoming more common by the day. With that said, we see some mistakes being made out there and would like to offer some tips.
Give it time. Buyers and agents would typically like to get a response from the seller within 24 – 48 hours. Generally not so in REO. In most cases 3 – 5 days is a more realistic expectation, and I often see good offers failing to get consideration due to the fact that the offer has expired before the asset manager (the bank’s selling representative) can get a look at it.
Put your best offer on the table. Everyone likes to get a “good deal”. However, I often hear buyers say, “I would have offered more” in multiple offer situations, after they’ve lost out.
Bring your check book. In most cases we must have proof of Earnest Money prior to submission. Those offers that don’t will often get overlooked.
Get the preapproval letter. Again, often a mandatory prerequisite for submission to the seller.
Waive the Property Disclosure. In Nevada, banks are not exempt from Real Property Disclosure. They will most often require the Buyer waive receipt of the prescribed and state mandated form. This waiver requires notarized signatures. Buyers and their agents should get this form completely filled out accept for the property address. Should you find the right home on a Sunday afternoon, it will sure make life easier with this form in the file.
Please read the remarks. Most REO/foreclosure listing agents include clear instructions for submitting offers in the MLS, Private Remarks. Failure to follow these instructions will often cause the offer to get lost or overlooked.
This all seems pretty “common sense” in nature, but I’m amazed at how often one or more of these points are missed. Good luck and happy house hunting.
For the third consecutive month, California foreclosure sales jumped significantly as lenders come off the moratorium, according to ForeclosureRadar.com. Foreclosure sales increased by 24.7 percent following a 31.9 percent increase in May, and a 35 percent April increase. Notices of Trustee Sale dropped by an unexpected 28.7 percent, with the timing of the drop indicating that it was in response to the California Foreclosure Prevention Act.
The California Foreclosure Prevention Act adds an additional 90 days to the time before which a lender can file a Notice of Trustee Sale. This law was widely believed to have little or no impact on foreclosure filings, as it exempted the majority of large lenders that operate in the state. A number of lenders appear to have self-imposed California’s latest foreclosure moratorium on themselves, despite having received an exemption from it. Given the number of exempt lenders it was quite surprising to see Notice of Trustee Sale filings drop by nearly 50 percent the day the new law went into effect.
Thirty-nine Dickson Realty agents have recently earned the prestigious Certified Distressed Property Expert (CDPE) designation, having completed extensive training in foreclosure avoidance and short sales. This is invaluable expertise to offer at a time when the area is ravaged by “distressed” homes in the foreclosure process.
Short sales allow the cash-strapped seller to repay the mortgage at the price that the home sells for, even though it is lower than what is owed on the property. With plummeting property values, this can save many people from foreclosure and even bankruptcy. More and more lenders are willing to consider short sales because they are much less costly than foreclosures.
In the Northern Nevada area, currently it is estimated that close to 1,800 homes are in danger of foreclosing. It is happening in all price ranges. Local experts say that even high-priced homes are not immune.
Dickson’s new CDPE designated agents: (shown)Teri Shields, Jeff Geisler, Tammy Olivas, Claudia Byrne, Chris Barns, Victoria King, Jill Deeter, Dan Rider, Andrea Green, Helen Graham, Beth Nitz, Amy Shocket, Mary Robinson, (not shown) Bonnie Beck, Cindy Henderson, Donna Clark, Ivy Cohen, Cyndi Dawson, Gary Edwards, Pam Eikleberry, Denise Fox, Jan Houston, Jen McDonald, Mandie Jensen, Christy Klinger, Anne Lavoy, Gerry Martin, Margie McIntyre, Dee McNeely, Brenda Mee, CJ Risley, Darlene Sharp, Jan Sluchak, Alison Elder, Norm Nicholls, Lil Schaller, Kane Schaller, Emily Sterling, and Maryann Truitt.
“Our job as REALTORS® has changed over the past several years. In our area, our number one goal is to help homeowners stay in their homes. If we are unable to do that then assisting them in a short sale may be a very viable option. A short sale doesn’t impact a homeowner’s credit as disastrously as a foreclosure does. A short sale usually nets the original lender more money and it does not devastate the neighborhood pricing. However working with lenders in a short sale situation can be very frustrating for sellers, for buyers and for real estate agents. We believe successful short sale closings require specialized training and we were pleased to have had 54 agents in this two-day training.” said Nancy Fennell, president of Dickson Realty. “In addition to this two day training, our firm holds monthly “short sale conversations” at each of our branch offices. We have sent our managers to short sale training around the country and we have pooled that information into our Short Sale Toolkit. Because policies and procedures change daily in this market, we find meeting monthly is a tremendous advantage for our agents. We are proud that our agents believe as we do in training, training and more training.”
Alex Charfen, founder of the Distressed Property Institute in Boca Raton, Fla., said that REALTORS such as these Dickson agents with the CDPE designation have valuable training in short sales that can offer the homeowner much better alternatives to foreclosure, which virtually destroys the credit rating. These experts have a better understanding of market conditions and can help sellers through the emotional experience, he said.
The Distressed Property Institute opened in January 2008 and provides training on-site and online. The CDPE is the premier designation for Realtors helping homeowners in distress and handling short sales.
To find our CDPE agents, visit us online at www.dicksonrealty.com or call any of our local offices: Caughlin Ranch 775.746.7000; Damonte Ranch 775 850.7000; Sparks 775.685.8800; Montreux 775.849.9444, or Truckee 530.587.
Dan Rider, an Owner/Broker of Dickson Realty, talks about Freddie Mac properties and the Homesteps program in the first part of our Freddie Mac series. Watch the video and learn what Freddie Mac and Homesteps is all about.
Wednesday, January 13, 2010 By: Lil Schaller
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