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New Short Sale guidelines going into effect

Apr 022010

New federal guidelines for Short Sales go in to effect on April 5, 2010. As I understand it, the goal is to streamline the process so that once an approved home is listed and receives an offer, the loan servicer will be required to respond yea or nay on the offer within a brief time period. This is a welcome change as I have had clients wait for over 6 months to receive approval. (Thankfully he was patient and received a great home at a great price.)

The Homes Affordable Foreclosure Alternative (HAFA) short sale process employs standard form documents and defined performance timeframes to facilitate clear communication between the parties to the listing and sale transaction. Servicers must adhere to the following guidelines in connection with the issuance of an SSA (Short Sale Agreement).

The rules do not apply to loans that are backed by Freddie Mac or Fannie Mae. Ask your agent to find out from the sellers agent who is holding the note. This may be different than who is servicing the loan. Banks are often servicers, not note holders (investor).
Allows borrowers (current sellers) to receive pre-approved short sales terms before listing the property
Requires each servicer to have a written policy, consistent with investor guidelines, that describes the basis on which the minimum net will be determined.
The minimum net proceeds must be equal to or less than the list price minus the sum of allowable costs that may be deducted from the gross sales price.
This amount must be documented in the seller’s file and may not be increased until the initial SSA termination date is reached (not less than 120 days).
Upon successful closing, the borrower will be entitled to a relocation incentive of $3,000 which will be deducted from the gross sales price at closing.
The amount of the monthly mortgage payment the borrower will be required to to pay during the term of the SSA – not to exceed 31% of the borrower’s gross monthly income.
Requires borrowers to be fully released from future liability for the first mortgage debt and if the second receives an incentive under HAFA, that debt will also be released.
There are other requirements for the borrower in regards to executing the SSA agreement and listing the home
Takes effect April 5, 2010 and sunsets December 31, 2012.

Key Timeframes:

Notification from the servicer (bank)
- If the borrower doesn’t qualify for HAMP (Homes Affordable Modification Program) the bank must consider borrower within 30 days after one of the following has been met:
  - Doesn’t qualify for trial period plan
  - Doesn’t successfully complete a HAMP trial period plan
  - Misses at least 2 consecutive payments
  - or Requests a short sale
Borrower has 14 calendar days from the date of the short sale agreement to sign and return it to the bank.
- The bank must give the borrower 120 days to sell the house (extensions permitted up to 12 months).
Within 3 business days of receiving a fully executed offer from a purchaser the Agent/Borrower must submit a complete Request Approval of Short Sale to the bank.
Ten business days after the bank has received the complete RASS they must approve or deny the request.
The first mortgage lien must release the lien within 10 business days or earlier after receipt of sale. The investor (lender) must waive rights to see deficiency judgments and not require a promissory note for the deficiency.

If you have ever wondered whether a Short Sale is a possibility for you, give me a call and we can confidentially review the situation and procedures. If you are interested in purchasing a short sale, we can help there too.

Thanks to Amy Cesario for her great post on the subject

Naperville single family homes continue strong in February

Buyers Information, Naperville Market Stats, Sellers Information No Responses »

Mar 062010

: Image via Wikipedia

National news in housing has been mixed lately, with home sales down over previous months but still higher than a year ago. The latest NAR report is available here. The numbers for Naperville single family homes continue steady on a month over month basis and stronger than a year ago. All statistics used in these reports come directly from Terradatum Inc. Their source is reported multiple listing service transactions.

Sold Homes: The average price for a single family home in Naperville sold for $423,729 in February 2010. That is an increase of 4.9% from the February 2009 average price of $404,026. Median prices were down at $315,080 vs $345,000. The gap between average and median price is typically around 12%. Last month it was 16%: this month it is almost 26%. That type of increase is only going to be caused by a wider range of prices above the median – an indicator that the upper levels of the Naperville housing market have started, and continue to move. Over the last two months the gap is widening.

The number of units sold is also up for February 2010 vs February 2009 at 52 vs 39 or a 33% increase. Homes under contract had a much sharper increase to 106 from 65 for the same period one year ago; an increase of 63%. (Both of these numbers are higher than January 2010 also!)

Inventory for homes in NAPERVILLE, IL All ZIP Codes

Months Supply of Inventory is a measure of how long, at the current rate of sales or absorption, would it take to sell out the market. The February MSI is 7.7, vs 14 a year ago – a decrease of over 46%. On a national level, the number is closer to 16 for this February and 24 months for last year at the same time – another indication that Naperville trends differ substantially from national numbers.

As always, if you want more detailed information or to look at the numbers on a more hyper-local level (zip code or subdivision) simply Order your free Market Report or drop me an email.

Area variations in Naperville single family home pricing

Around Naperville, Buyers Information, Naperville Market Stats, Sellers Information 1 Response »

Mar 012010

In talking with new homebuyers in Naperville or transferees, I am often asked what a typical home goes for in Naperville and how much that has changed in the last several years. And the answer? It depends; what part of town (zip code) and even within a zip code, what subdivision. The following charts give a good picture of just home wide that variation is. Of note also is the differing trends by area.

As you can see, the first chart shows all of Naperville single family homes combined. Median price has dropped from around $508,000 13 months ago to a low in November of right around $480,000. Since then we have seen a recovery in prices to just under $490,000. Keep in mind, that median price in Naperville is generally about 12% lower than average price.

Our first breakout by zip code looks at 60540 home prices. During the same time period those have gone from a high of about $590,000 to just under $500,000 in August 09 – a sharp drop over a 4 month period. Since that time median prices have been drifting in a range of $490,000 to $500,000.

Next we look at home prices in 60563. Here we see a start around the $429,000 level with a decline to the low $390,000′s in December 09. Since then we have seen a sharp rebound to about $411,000 through February 2010.

Median home prices in 60564 have yet to see much of a recovery. Since April of 09 median pricing has gone from $568,000 to about $532,000 in February 2010.

Finally we look at 60565 home prices. This area of Naperville has weathered the past year much better than any other. In fact, the median price at the end of February 2010 of $445,000, is above the median of $430,000 in April 09! There had been a rise last summer to near the current level but there was a late year valley down to the low $430′s.

This is the maximum break out level for these charts. If you want to look deeper into your specific area or subdivision, drop me an email and we can take a look.

peace

A strong January for Naperville single family home sales

Buyers Information, Market Statistics, Naperville Market Stats, Sellers Information 1 Response »

Feb 072010

Image via Wikipedia

We are seeing a lot of numbers lately on this housing trend or that particular statistic on a national or regional basis and those are all well and good, but as always, here we look at what is happening to prices and sales activity for single family homes in Naperville. All statistics used in these reports come directly from Terradatum Inc. Their source is reported multiple listing service transactions. After an interesting 2009, how did 2010 start? Let’s look:

Sold Homes: The average price for a single family home in Naperville sold for $444,261 in January 2010. That is an increase of 16.1% from the January 2009 average price of $382,554. Median prices were relatively flat at $371,750 vs $366,500. The gap between average and median price is typically around 12%. This month it is around 16%. That type of increase is only going to be caused by a wider range of prices above the median – an indicator that the upper levels of the Naperville housing market are starting to move. It will be interesting to see if this trend continues in the coming months.

The number of units sold is also up for January 2010 vs January 2009 at 44 vs 40 or a 10% increase. Homes under contract had a much sharper increase to 78 from 61 for the same period one year ago; an increase of 28%.

Inventory for homes in NAPERVILLE, IL All ZIP Codes

As always, if you want more detailed information or to look at the numbers on a more hyper-local level (zip code or subdivision) simply Order your free Market Report or drop me an email.

Zestimate - What it is and what it is not

Buyers Information, Sellers Information 1 Response »

Jan 212010

Education, understanding, and knowledge are key components in buying or selling a home. There are a lot of public domain tools available on the web that, when examined can be confusing. One tool that receives a lot of publicity is the “Zestimate” provided by Zillow. The following video by David Gibbons, Director of Community Relations helps explain what it is, what it is not, how to use it as a tool, and how to help make it better.

That clear things up a bit? Like any tool, the Zestimate on your home or the home you are contemplating purchasing is just one of many to be utilized. If you have any questions or want to discuss further, I am always available. Just click your favorite button on the right or shoot me an email.

peace, Tony

Naperville November home sales continue strong.

Around Naperville, Buyers Information, Market Statistics, Naperville Market Stats, Sellers Information 1 Response »

Dec 092009

There has been a significant amount of news coverage lately on home sale statistics. The Illinois Association of Realtors (IAR) recently announced record sales levels for October. On a more local level we are continuing to see the seasonal effect typical of this time of year, although market activity remains strong over the same period a year ago.

This report focuses on single family home activity in Naperville. Other posts will focus on townhome and condo activity in Naperville and Aurora. If you want to drill down even more, detailed reports are available by zip code. Just click the button to the right and indicate in what area you want additional information. It will be emailed to you promptly.

Last 12 Weeks vs Previous 12 Weeks: (Source -Terradatum/MRED, LLC). Numbers shown are based on single family data. Contact me for further individual breakdowns.

Homes Under Contract, 20 vs 29, down 16.9%. We have seen a bit of a slowdown in homes going under contract. This is typical of the seasonal nature of real estate. This is the first down month after 7 consecutive months on the uptick. Homes Sold went from 29 12 weeks ago to 20 or a decrease of 32.7%. Again, this is not unusual give the time of year. On a year over year basis, Homes Sold are up 16.2% over the same period one year ago. That is good news for the long term.

Continuing the trend started last month, Homes For Sale decreased almost 17% from 1090 to 907. With fewer homes on the market, we should begin to see some stabilization in pricing.

Median Price for Homes Sold in November 09 is down 5.2% from $408,210 to $387,162 This change is probably more a function of which properties are selling . The median for Homes Under Contract however, dropped from $424,462 to $405,554 – a decrease of 4.5%. Median List Price remained relatively flat: $489,400 vs $491,217.

Median MAI for homes in NAPERVILLE, IL All ZIP Codes

The Market Action Index is broken out by market quartiles this month and reflects different activity levels for each market segment. The lower priced homes have seen the most stability in activity, tier two the second most, and so on. the high end luxury market continues to move at the slowest pace. For more detailed information, send an email request with your specifics or complete the Report Request and it will be emailed to you shortly. And, as always, feel free to share this information with others.

Home prices may be bottoming out (money.cnn.com)
The Nation’s Top 10 Most Searched Homes (abcnews.go.com)

Aurora Condo and Townhome market report

Aurora, Aurora 204 Zip Codes, Buyers Information, Market Statistics, Mortgage, Real Time Market Statistics, Sellers Information No Responses »

Nov 222009

New this month – Market Report on Condos and Townhomes in Aurora. This will be following the same format as the monthly single family homes report but will focus on this segment of the market. Industry news in recent weeks has included the expansion and extension of the Home Buyer’s Tax Credit. Essentially, the program for first time buyers requires a contract date no later than April 30, 2010 and a close date no later than June 30, 2010. The amount is 10% or a maximum of $8,000. Income limits have been adjusted upward so more people may be eligible. Existing homeowners (not just upgraders) who have owned and lived in their home for five consecutive of the last eight years may be eligible for up to $6,500. This chart has a good summarization of the changes. And for a Frequently Asked Questions or FAQ, go here.

Data comparisons* are made for the current 12 week period vs the previous 12 weeks.

Homes Under Contract, 13 vs 10, or an increase of 30%. This upward trend has been steadily continuing over the last several months and continues into the fall months. Homes Sold remained steady – 11 vs 11. They have been at this level on a continuous basis since early June, 2009, indicating a relatively stable market.

Continuing a trend that started in July, Homes For Sale decreased 9% from 610 to 558. This continued reduction in inventory bodes well for stabilization in pricing and competition in the marketplace.

Median Price for Homes Sold in October 09 is down less that 1% from $152,167 to $151,288 – an insignificant change. The median for Homes Under Contract however, dropped from $162,575 to $150,896 – a decrease of 7.2%. Median List Price dropped 2.5% from $162,262 to $158,171. All three pricing metrics have been gradually declining over the past 6 months.

Condos and Townhomes in Aurora, IL

These stats are also available on an individual zip code basis. Contact me to take a closer look at your particular area. Or request your own customized report and it will be emailed promptly.

Housing Tax Credit Extension and Expansion one step nearer

1st Time Homebuyer Tax Credit, Buyers Information, Government Housing Programs, Sellers Information 1 Response »

Nov 052009

: Image by I See Modern Britain via Flickr

On Monday evening, the Senate cloture vote of 85-2 moved the legislation one step closer to a full vote and a potential signing by the President later this week or weekend. HR3548 contains a trio of measures that extend unemployment benefits, extends and expands the housing tax credit, and thirdly allows for recovery of previously paid taxes for companies losing money in 2008 and 2009.

As of Weds evening both Houses had passed versions of the bill that contained similar provisions:

The details of the housing tax credit provisions look like this:

The $8,000 credit for first time buyers would extend to to the end of June 2010 for contracts signed by the end of April 2010.
For existing home owners who have been in there homes for five or more years, the credit would be $6,500.
There are also measures to help the government catch those who attempt to cheat.

The next step is a vote on the bill by the full Senate and then the House. From what I have been reading, little opposition is expected in the House so the bill could be on the President’s desk as early as this weekend. Stay tuned for further updates.

Senate Acts to Expand Housing Credit (nytimes.com)
Senate OKs home buyer credit extension (dontmesswithtaxes.typepad.com)
Extended, expanded homebuyer tax break nears passage (lansner.freedomblogging.com)

Thinking of renting that Naperville home? Scam Alert

Around Naperville, Sellers Information No Responses »

Nov 052009

While this video comes from Dallas, TX, if you are thinking of renting your home or investment property, it’s worth a watch. The basic message is if your potential renter wires you or mails you funds and asks for the money to be deposited and a portion of it returned, odds are it is a scam.

If you want help renting that property, screening potential renters and getting the most out of your investment, give me a call and let’s talk about how I can help.

Housing Indicators Expected to Rise

Around Naperville, Buyers Information, Sellers Information No Responses »

Oct 192009

From Market Watch 10/19/2009

Major housing indicators should rise again in September, according to a survey of top economic forecasters ahead of a relatively light week for economic data. Data on housing will dominate the headlines this coming week. Full Report

We will be keeping watch and posting links to the most relevant posts/articles/releases as they become available. With continued strength in the markets and activity in DC on the Tax Credit, housing should continue to be at the forefront of the news in the fourth quarter.