CoreLogic® Home Price Index Rises Again

Good News for National Home Market

CoreLogicYoYJan2013

Most Recent Chart Available

The CoreLogic Home Price Index (HPI) showed that home prices in Washington State, including distressed sales, increased on a year-over-year basis by 10 percent in February 2013 compared to February 2013. This change represents the biggest increase since April 2006 and the 12th consecutive monthly increase in home prices nationally. On a month-over-month basis, excluding distressed sales, home prices increased by 11 percent compared to February 2012*. The HPI analysis shows that all but two states, Delaware and Illinois, are experiencing year-over-year price gains.

© 2013 Corelogic.  Full Report Online

Meanwhile, Clark County Builders Are Building

Builders work on the the roof of a new home under construction in the Montreal suburb of Brossard

The Columbian newspaper reports a continuing increase in new home permits – up three times the number issued for this period last year.

This bodes well for a spring surge in home sales – even though foreclosure starts in Clark County increased in the first quarter.  

The current low inventory could well mean continued increases in prices as the home-buying season begins.

 

 

 

March Madness Came Early – And We’re Not Talking Basketball

A question that sometimes drives me hazy: am I or are the others crazy?

Albert Einstein

Most housing indicators in Clark County point towards a positive market rebound this year.  2012 saw a mid-year decline in foreclosure rates, a steady decrease in REO (bank-owned) sales, and increases in sales of non-distressed properties.  Starting the new year, the market saw increasing home prices  (still are), decreasing inventory (still is), and an uptick in housing starts (new permits are up). The outlook looked very good for a market rebound this spring.

Housing-roller-coasterBut as we approach Spring, conflicting trends will drive you crazy trying to predict where this market is going.  Since October 2012, in spite of the positive upward trends, there is another “upward” trend that could have a negative impact – the foreclosure rate in Clark County WA.  RealtyTrac, a foreclosure service and tracking site, reported consistent increases in foreclosure rates starting in October 2012 and continuing through first quarter, 2013.  That’s a trend that cannot be ignored.  As we enter the Spring Buying season, the question is – will this trend continue and how will this affect the rebounding market?
Some say this will have no impact, due to the low inventory of houses.  Others fear that, if lenders continue to dump houses back on the market at distressed prices, this will put pressure on fair market prices.

Shadow-inventory-GraphicThis is part of the uncertainty caused by the banks and their “shadow inventory” discussed here last June.  Distressed properties kept off the market are not easily accounted for in the numbers. Certainly, these foreclosure rates will have an affect on short sales and the prospect for finding real “deals” in the market.  And as banks unload their distressed properties, returning to healthier financial conditions, we all eventually benefit.
Either way, we’re in for a crazy time trying to predict housing trends in Clark County. As Yogi Berra once said:

It’s Tough To Make Predictions – Especially About The Future

Yogi Berra

Home Builders on Green Construction “Let Mikey Try It First”

Green Ideas Take Time to Go Mainstream

By: Bernard F. Stea, JD, Managing Broker

MikeySometimes a new concept is slow to take hold in business.  Even if it makes sense and it might be good for business, no one wants to be the first to try it.  Just like the classic Life cereal commercial where the two boys won’t try it because it’s good for them.  They want Mikey to try it first, then they change their minds after “He Likes It!!”

Sometimes Green Ideas Are Slow To Catch On
Until Someone Else Tries It

So you know a concept has come into its own when a major corporation implements it as a product, and not just an ad slogan.

Lennar, one of the largest homebuilders in the country has announced its NextGenSM model – “The Home Within a Home”.  Its design incorporates separate living quarters – private bedroom, bathroom, sitting room and kitchenette – all within the single family structure.

© Lennar Corporation

While the space has many uses, it addresses the desire for “in-law” quarters for aging parents, which often involves separate structures, or apartments over a garage.  The NextGen SM affords the privacy and independence many families want, with the enormous benefit of keeping the family together.

As noted in our earlier article Gray is The New Green, a green approach to our graying population benefits us all: more efficient use of land, materials, and natural resources for utilities. Plus, there is the incalculable benefit of keeping elderly parents within the family unit and not in a nursing home.  Even with the separate entrance, the price tag is more affordable than having a separate structure.  With its extended usefulness and flexibility as the family changes and evolves, it also becomes a better investment for the homeowner.

EnergyStarLogo
Another sign of how green is catching on, more builders are going through the extra expense and steps to have their houses certified Energy Star. One subdivision in Camas, Knights Court, is a good example of low-footprint homes with Energy Star certification, and high-end amenities, but in a very affordable price range for families. For more information contact Debb Janes, EcoBroker.

So, just as Mikey tries it and “He Likes It”, more families will be demanding green designs  and more builders will respond.

 

The Devil Is In The Detail – When In Doubt, Read The Contract

 

RTFC!A recent experience reminded me that all too often, especially in short sale transactions, we react to situations with our emotions, rather than logic, and the terms of the contract.  There are lessons here for everyone:

This was a typical scenario short sale:  Sellers put house on market and, after no offers for weeks, accept a (low-bid) offer on their house.  The sales contract is signed around, including the standard Short Sale Addendum used in this region.  Listing Agent changes listing to Short Sale Pending and no other offers come in.

Short Sale Specialist (me),  presents the proposal to the Lender and awaits approval.  Lender comes back and says the appraisal is much higher, and they will not entertain any arguments over valuation until either Buyers come back with a higher price, or Sellers put the house back on the market to receive other offers.

Buyer’s Agent is notified of decision by e-mail and after some haggling back and forth, Buyer’s Agent reports:  ”No, we stand by our original offer.”   Listing Agent for Sellers puts house back on market, and receives another offer at a price closer to the Lender’s requirements.  Buyer’s Agent cries “Foul – you can’t do anything until Buyer formally rescinds his original offer!”

So, who is right in this situation?

When In Doubt, Read The Contract

This is where you need to go back to the Short Sale Addendum the parties signed and actually read it.  Sure, under a  regular Purchase and Sale Agreement, offers, counteroffers, additional addenda, etc. are typically handled through signed forms.  But a short sale is a different animal with a lot of unknowns  and the parties have little control over when and what the Lender decides.

For this reason, the Short Sale Addendum is designed to address the unique aspects of this type Contract Signingof  sale and binds both parties to a more fluid arrangement.  It recognizes that the Lender may require Seller to find as many Buyers as possible, and actually authorizes the Seller to accept other offers.   Which is not allowed under a regular sales situation.  It also states that when Seller gives notice* of the lender’s denial of the short sale, it automatically triggers a termination.  Period.  No need for a formal rescission.  There is actually no provision that states the Buyer has the option of making a counteroffer (although as a practical matter it would probably be entertained).

*These days e-mail is recognized as a proper form of notice – supplanting the need for a written  form and delivery in person or fax.  It is also agreed to in the contract.  Read it!

So, if you find yourself in a short sale situation and receive an e-mail from the Short Sale Specialist or Seller’s Agent saying your offer was not accepted by the Lender, don’t be offended if the house goes back on the market to a higher bidder.  If your buyer truly wants the house, do the valuation and advise your buyer on their options.  Don’t assume you still have a contract to fall back on to negotiate.

The Devil is in the Detail – When in Doubt, Read The Contract!

____

Short Sale Builders specializes in providing short sale services to brokers.  This web site and these articles are intended to provide only general information and not legal advice.  If you have questions about your particular situation, you should consult with an attorney familiar with the issues and the laws in your state.  

Gray is the New Green

The Silver Lining in Our Aging Population

Aging Population Shows Silver Lining

“Nothing is certain in life except death and taxes”
To which we can add the corollary: “and aging.”

Baby Boomers

are a major segment of U.S. demographics.  And they’re becoming senior citizens at the rate of 10,000 per day. With better health care and lifestyle choices, seniors are a fast-growing segment of our population, and will continue to grow for the next 20 years. By the year 2030, 25% of Clark County will be 60 or older. Aging is a reality that presents both challenges and opportunities to our communities. Public agencies and non-profit groups across the country are trying to address these concerns.

Commission on Aging Logo

One prominent group in Clark County, the Commission on Aging has studied these issues and published an Aging Readiness Plan to address housing, transportation and quality of community life as our population ages. Appointed by the Board of County Commissioners, the group’s plan was adopted earlier this year.

[Update to this Article: The Commission on Aging has received national recognition for its Aging Readiness Plan. Read More]

The Commission addressed the issues of livability that affect all of us: community design, access to parks and recreation, support services, and transit. But housing and independent living are particularly important for seniors. The Commission found that 85% of older adults want to remain in their homes as they age. When residents stay in their homes, “the community retains its tax base and preserves neighborhood stability.” Likewise, with strains on government programs, staying at home is a less expensive option than living in a facility.

Now you may be among the Gen Xs or Millennials who are tired of hearing about the Boomer generation and wonder how this relates to our younger population. Well, there is a silver lining in this “silver” trend. Solutions to the housing and lifestyle needs of an aging demographic will reap direct benefits to the environment and our community as a whole. In other words:

The Graying of America will contribute to the Greening of America

UniversalGreenDesignHow so? The Commission’s recommendations for housing follow the goals and guidelines of Universal Green Design (UGD).  UGD is a long-term approach to building and remodeling that combines environmentally sustainable elements of green building with the flexibility of universal design. These goals are also compatible with the quality of life and independence goals for an aging population:

  • Homes that meet a family’s changing needs as they grow older
  • Homes where people of all abilities, ages and sizes can thrive
  • Energy-efficient homes that are cost-efficient for changing incomes

Key features for a UGD home include:

  • Single-level living with zero-step entrances
  • Open floor plans and extra wide doorways and hallways for room to maneuver
  • Energy efficient appliances with easy-to-read and operate controls
  • Specific recommendations for every room to make them more senior-friendly

HouseDesign
The result is a home designed with a longer usefulness and lower environmental impact.

So how does the Commission plan to mesh these high-minded goals with the reality of current housing conditions in the Northwest? For example, only 35% of homes in Clark County are single-level. With Urban Growth Boundaries in the Northwest, the focus has been on density at the expense of flexibility in design. Single-level houses typically require larger lots, working against those density targets. Compounding this challenge is the concern that we already have a shortage of residential lots in the region.

Suggestions to counteract this have included more creative housing design and reduced setbacks to maximize lot area. So will this require additional regulations or relaxing of zoning or building codes to satisfy the growing demand?

In answer, the Commission specifically identified four challenges in senior housing:  Affordability, Design, Choice, and Information. Each challenge is addressed with a corresponding short to long-term strategy – too many to list in this article, but worth reviewing in the Plan. The overall theme of many of the recommendations is public awareness, working with a long-term vision and the planning process, educating builders and remodelers about the potentially huge market in building with UGD guidelines. The thinking is, rather than force regulation to bring about change, encourage the marketplace to create demand for UGD-designed homes with an eye for longevity and increased value.

Debb Janes, Clark County EcoBroker®, comments on this market-driven approach: “More builders are realizing that it makes good sense to build ‘green’. As the trend continues, both individual home buyers and the community at large enjoy the benefits of saving money and saving natural resources. And because the homes are built to last, so do the benefits.”

In other words, today’s new generation of homebuyers can help shape the design and usability of housing for our aging population. Aging is inevitable, but if the marketplace embraces UGD, then

The Graying of America will help the Greening of America.

 

 

Washington Court Shows MERS-y on Homeowners

Banks Can’t Take Shortcut – Homeowners Should Take Note

The Washington Supreme Court in Bain v. Metropolitan Mortgage, struck down a practice utilized by some lenders when they foreclose on delinquent homeowners.   The ruling could have implications for distressed homeowners in Washington and the procedure their lenders must follow to complete a foreclosure.  But to understand the ruling, it’s important to understand  the process the court ruled invalid.

In many states, including Washington, most of us sign a Deed of Trust when we take out a home loan – it’s basically protection for the lender if we default, and lets them use an administrative process of foreclosure, rather than go to court.  We also agree that the original lender can sell the loan to other institutions.   Known as the secondary market,  it is not uncommon for a loan to be purchased and sold several times throughout the life of the loan.

MERS Created as a Convenience to the Industry

As a way to streamline this process, and stimulate the secondary market, the large lenders started an organization called the Mortgage Electronic Registration Systems, or MERS in the 1990′s.  Ostensibly set up as a central repository for recording these assignments,  MERS was also at times named as a “beneficiary” to the deed of trust that secured the underlying debt.   Since MERS was keeping track of all these transactions, subsequent transfers of the loans were not recorded in the county land records, which saved the banks a lot of money in recording fees.

As in this simplified diagram below,  although MERS was named the  ”beneficiary” of the Trust Deed for convenience to the banks, they technically did not have the underlying note, which was held by the lender or subsequent purchasers.

Court Requires Accountability

That’s where the court found fault. MERS did not have sufficient ownership to bring the foreclosure process in its own name.  The court noted, given recent major litigation over errors in the foreclosure process, transparency and accountability to the process were critical.  But this practice made it difficult to know who was actually responsible, so this foreclosure was invalid.  The court made it clear, however, the underlying obligation was still valid and could be enforced through another foreclosure procedure, brought by the proper parties.

Although MERS stated that it ceased bringing foreclosures in its own name more than a year ago, there could be remnants of this process out there.  But those are not automatically invalidated – they will need to be decided on a case-by-case situation.   Also, the court held open the possibility that a homeowner could file a Consumer Protection claim for the improper foreclosure.

The lesson in all of this is, if you are struggling with mortgage payments, talk to your lender about a loan modification, or consult an expert on all of the  options available, including a short sale, before you face foreclosure.   If you are faced with imminent foreclosure, you should always consult a lawyer.  You may not be able to completely stop it, but as in this case, you can make them follow the proper procedures.

 

For more information about available options to avoid foreclosure,  Contact Us.

 

Clark County Real Estate 2012 – Dog Days of Summer Nothing to Bark At

The Dog Days of Summer in Clark County

Clark County Real Estate Hot These Days

It’s August in the Northwest, and that means hot, sultry days in Clark County. Temps hovering in the 90s and late afternoons that feel like you’re in a sauna.  These are the Dog Days of Summer.

This season conjures up images of  poor, overheated canines panting in the sweltering heat, and daily human activities, too hot to manage, grinding to a halt.  Smothering humidity and the monotonous drone of mowers lull you into a heat-induced stupor.

But Wait, It’s Not All Bad

That imagery of  a lethargic inferno is actually contrary to the origins of Dog Days. The Romans associated this time of year with the brightest star seen at night  - Sirius in the constellation Canis Major, or Large Dog.   Hence, the Dog Days.  Which means we should really celebrate the Dog Days of Summer because  things are looking “brighter”.   And, by the way, that  certainly applies  to real estate activity in Clark County.

Things are active and alive in home sales – showing a continued trend of anything but slow and lethargic.

In the last month, new listings overall are up – an increase of nearly 20%.  But distressed properties declined to only 18% of those new listings.  As contrasted to last month when nearly 30% of all new listings were distressed properties.  Plus, sales are up 28% over last month , but also showing a decline in how many of those were distressed properties.

On similar fronts, we’re seeing lower inventory compared to a year ago, and an increase in selling price, with a corresponding decrease in the number of days a house sits on the market.   In fact, some experts have suggested we may be facing a shortage of buildable lots in the near future if the market continues to rebound at this pace.

Weather forecast or market forecast – whichever you rely upon, you can officially declare that the Dog Days of Summer are here in Clark County.  And it’s certainly nothing to bark at.

 

For more information about Short Sales in Washington, Contact Us.

Search for Short Sales in Clark County Washington:

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Roller Coaster Ride in Clark County Real Estate Market

Roller Coaster Ride for the Clark County Real Estate Market

Summer is finally here and nothing says summer fun like a roller coaster ride at an amusement park.  My personal favorite used to be Space Mountain, especially when the ride plunged you into total darkness, dropped straight down then lurched back up and side to side.  That’s how it feels in the Clark County real estate these days – riding a roller coaster in a total blackout.  But it’s not all scary if you have the sound advise of an experienced real estate adviser: buckle down, keep your arms and legs in at all times, and hang on for the ride.

RealtyTrac Foreclosure Starts Going Up

(Source: RealtyTrac)

Ups and Downs in the Real Estate Market in Clark County

Since the first quarter of the year trends showed a decline in foreclosures and short sales, a decrease  in available inventory, and a slight increase in prices generally.  Signalling, perhaps, the beginning of the recovery. Much like the slow ascent to the top of the ride.

But as noted here last month, shadow inventory (houses not on the market, but in default) can be tricky, and hard  to predict, just like the drops and turns as you start the descent om a ride.   Recent numbers released by RealtyTrac  indicate a rise in foreclosure starts in Clark County.  This also reflects the trend nationally as banks start to ramp up their foreclosure activities following the freeze caused by federal and state activities last year.

You may recall a slew of lawsuits alleging foreclosure impropriety – chiefly the practice of “robo-signing” documents. They stalled foreclosure activity until earlier this year, when the banks reached a $25 Billion settlement.   While there are still technical challenges against MERS  (the electronic registry used by banks to record trust deeds), that settlement opened the way for banks to resume their foreclosure processes.  It has taken until this month for the impact to start showing up.

Will the Roller Coaster Real Estate Market smooth out in Clark County?

Is this all bad news?  Not necessarily.  It may signal more short sales and bank owned properties will be coming on the market.  This could create more opportunities for buyers. Unless  the banks do something really stupid like release a flood of homes all at once, this may not affect pricing too much, as there is currently a shortage of homes in inventory.  So homeowners who are thinking about selling, may not need to worry about a sudden drop in prices.

The key to any market like this one is having a trusted real estate advisor who can help help through the ups and downs and twists and turns. Hang on – it’s a roller coaster ride in the Clark County, Washington Real Estate Market.

Shadow Inventory – Silver Lining for Washington Real Estate?

A Corelogics report last month showed a national downward trend in “Shadow Inventory” in the first quarter of 2012.

There might be a Silver Lining for Washington Real Estate in that report.

Shadow Inventory in Clark County a Silver Lining? ”Shadow Inventory”

may seem like an ominous term. And it might be for some people – it refers to distressed properties that are seriously delinquent but not yet in the foreclosure process or listed.   This is considered a bellwether for the real estate market in Washington which also showed a decline in shadow inventory.  This can be an indication that foreclosures (and short sales) are on the decline.

Translated loosely, as the shadow inventory decreases, and the economy continue with its moderate recovery, prices could be starting to rise. Fewer foreclosures will take pressure off the “normal” market and help price to make adjustments back to a more normal supply and demand pricing. This is good news to sellers who are thinking about listing their homes in Clark County.

Will it ever return to the crazy inflation of prices that led to the real estate bubble that brought about all these problems? We certainly hope not. When it comes to home ownership as a basic value of our society, there is nothing wrong with a healthy market with regular appreciation in values. But crazy accelerated price driven by greed and unprincipled lending? Let’s hope we never go there again.

Let’s also hope the ominous shadow of foreclosures eventually disappears and we will soon return to a normal market for real estate in Washington.  Then I won’t have to resort to mixing metaphors about the silver lining in the shadow inventory in Washington Real Estate.

For more information about Short Sales in Washington, Contact Us.

For Specific Areas of Clark County Washington:

Search for Short Sales in Camas now.      Search for Short Sales in Fisher’s Landing now.  Search for Short Sales in Washougal now.

Distressed Properties in Clark County, Washington – Not the Only Game in Town

Many of my clients assume that the best deals in Clark County are Distressed Properties - short sales and bank owned.  That’s not accurate, and they’re not the only Game in Town.  In fact, the local RMLS just released the statistics for all Distressed Residential Properties in the first quarter of 2012.
Here’s the breakdown for First Quarter sales in Clark County when compared to last year:

  • Distressed sales as a percentage of new listings decreased by 4.6% (39.7% v. 35.1%).
  • Distressed sales as a percentage of closed sales increased by 0.3% (47.8% v. 48.1%).
  • Short Sales comprised 23.8% of new listings and was down 0.6% from 2011. However, the percentage of short sales rose from 17.1%  in 2011 to 20.4%  in 2012, a 3.3% rise.
  • Bank Owned properties comprised 11.3% of new listings and 27.7% of sales in 2012, down 4.0% and 3.0% from 2011.
If you’re looking for a great deal in Clark County, Washington, there are many non-distressed properties to choose from as well as Distressed Properties – short sales and bank owned.  If you’re not sure if you’re short sale material – here’s a quick link with more information.
Discuss the pros and cons of purchasing a short sale or a bank owned property with a knowledgeable and experienced Short Sale Expert. There are still a number of Distressed Properties for sale in Clark County Washington, just remember, they aren’t the only Game in Town.
( Article written by Debb Janes, EcoBroker, Broker, The Carl Group LLC)

For more information about Short Sales in Clark County, Contact Us.

Search for Short Sales in Camas now.      Search for Short Sales in Fisher’s Landing now.  Search for Short Sales in Washougal now.