Hampton Roads Real Estate Ramblings

What is Shadow Inventory?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Sun, 25 Mar 2012 19:09:00 +0000

Hello Hampton Roads,

Have you heard of the term "Shadow Inventory" and wondered what it meant?

Shadow Inventory consists of the following:

Homes 90 days delinquent on the mortgage--97% of people who are 90 days delinquent on their mortgage end up selling their home in some sort of distressed property sale (either a foreclosure or short sale)
Houses already owned by banks but not yet on the market
Houses already in the foreclosure process but not yet foreclosed

Below is a picture showing month's supply of inventory by state--this data is taken from the latest NAR (National Association of Realtors) from Nov 2011.

Virginia is shown to have a 14 month supply. Expect to see more of this shadow inventory released this year and in 2013 as a result of the national mortgage settlement which gives guidelines on how banks are to proceed with foreclosure.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Hampton Roads Real Estate Market in 2012

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Sat, 17 Mar 2012 20:01:00 +0000

Hello Hampton Roads,

2012 is shaping up to be a pivotal year in real estate! Both low interest rates and low prices paint an optimistic picture of real estate but is this the year the market bottoms?

On the one hand we see visible inventory decreasing, but on the other hand foreclosures are again on the rise. What does this mean?

Before we get to these answers let's take a look at local numbers to see where we are; below is a chart showing the most recent absorption rate (months supply of inventory) for the 7 cities of Hampton Roads (from REIN MLS February, 2012, statistics). Absorption rate is the amount of time it will take to sell all the homes currently on the market at the current sales rate provided no new properties enter the market.

Four of the seven cities show a decline in inventory from the prior month indicating that we are moving toward a more balanced market. Activity is most brisk in Virginia Beach which boasts the lowest absorption rate. However, the absorption rate has increased in Chesapeake and Suffolk indicating a growing inventory while Newport News has stayed the same from the previous month. Given the numbers in the chart we can safely say that the trend is toward a decrease in visible inventory.

Now what about the invisible inventory, the shadow inventory, of homes that have yet to hit the market? According to a Virginian Pilot article from 3/15/12, foreclosure filings have increased in our area.
See the chart below:

Banks are starting to release more of their inventory and what this market has taught us is that the presence of distressed properties will further depress prices since these homes become comps (comparable sales) for all other homes in the neighborhood once they sell. The impact on prices is neighborhood specific as some areas have a heavier presence of distressed properties than others. However, Celia Chen from Moody's Analytics predicts that with the advent of the latest bank settlement and subsequent increase in foreclosures prices will drop another 3% nationally.

So coming full circle to our question in the beginning of this post, "Is this the year the market bottoms?"

The most accurate answer is maybe or maybe not because no one can say with 100% certainty whether we've hit bottom. The better question to ask is "What is the opportunity for me and my family to buy a home in today's market with high housing affordability, low prices and low interest rates? And what is my opportunity cost if I choose to wait?"

Only you can answer these questions, but opportunity waits for no man (or woman!) and one thing we know for certain is that as with all cyclical markets, prices and interest rates will eventually rise. What will you choose to do?

Thanks for reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

What's the World's Greatest Investor Saying About Real Estate in 2012?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Fri, 16 Mar 2012 03:16:00 +0000

Hello Hampton Roads,

The winds of change are in the air for the real estate market in 2012 and it's a positive change for all home buyers whether they are first time buyers, investors or even move up buyers!

Warren Buffet, known to be the world's greatest investor was recently asked about real estate on CNBC's Sqawk Box on February 27, 2012:

Here's the scoop:

Is real estate is a good buy today:
"Single family homes are cheap now...If I had a way to buy a couple hundred thousand single family homes I would load up on them"

Why invest in real estate now?
"It's a way, in effect, to short the dollar because you can take a 30 year mortgage and if it turns out your interest rate's too high, next week you refinance lower. And if it turns out it's too low, the other guy's stuck with it for 30 years. So it's a very attractive asset class now."

Should an young investor buy stocks or his first home?
"If I knew where I was going to want to live the next 5 or 10 years I would buy a home and I'd finance it with a 30 year mortgage...It's a terrific deal."

On buying multiple homes....
"If I was an investor that was a handy type and I could buy a couple of them at distressed prices and find renters, I think it's a leveraged way of owning a very cheap asset class now and I think that's probably as an attractive an investment as you can make now."

If you are considering buying a home to live in or as an investment, now may be the perfect time as both interest rates and prices are are still low! As always, feel free to contact me to discuss your real estate needs.

Thanks for Reading,

______________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Fri, 13 Jan 2012 18:08:00 +0000

Hello Hampton Roads,

I trust everyone is getting settled into the new year, and it’s just in time for the holiday weekend—whew, we needed a break, right?

I thought folks might be interested in an article in the January 12, 2012 Virginian- Pilot Online entitled “Foreclosure filings hit a three-year low” by Josh Brown.

On the Local Front:
Foreclosures were at a record high in 2010, but have been falling throughout 2011. The number of December foreclosures is up to 812 notices sent from the 2011 low of 635 notices sent in November. However the 812 in December 2011 is down from the 1004 sent in December 2010. These numbers are three-year lows for Hampton Roads.

For the year 2011, the number of foreclosures fell to 6,988, down 45% from 2010, when there were 12,815. According to the article this suggests that foreclosures may be easing. In fact, an economist at ODU, James Koch, said we are through the worst of it.

On the National Front:
Foreclosures also fell 34% nationally in 201; 1.9 million properties received notices, which is the lowest level of foreclosure activity since 2007.

These numbers are provided by RealtyTrac's and its president had this to say:
"There were strong signs in the second half of 2011 that lenders are finally beginning to push through some of the delayed foreclosures in select local markets. We expect that trend to continue this year, boosting foreclosure activity for 2012 higher than it was in 2011, though still below the peak of 2010."

This may mean that there is a light at the end of the tunnel for homeowners, but that foreclosure activity may still be high. There will still be good real estate deals out there, and there is evidence that if you are a homeowner in financial distress, there are more opportunities available now for you to work it out with your bank.

I specialize in selling distressed properties sales and in helping home buyers and investors alike in this market.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

How a HAFA Short Sale Can Benefit YOU!

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Thu, 17 Nov 2011 00:30:00 +0000

Hello Hampton Roads,

A HAFA Short Sale is a government assisted short sale that is more streamlined, easier, and faster to process than a regular short sale. HAFA offers a faster timeline than a traditional short sale and provides monetary incentives to distressed homeowners, servicers and subordinate lien holders to make the process mutually beneficial to all parties.

Here are some of the highlights:

A pre-approved selling price or acceptable sales proceeds amount
A minimum of 120 days to market the property-maximum 360 days and the foreclosure process is stopped during this time!
A 10 day time frame to respond to offers to purchase the home
Debt is eliminated--there is NO deficiency judgment
A homeowner may not even have to claim the forgiven debt as income per the Mortgage Forgiveness Debt Relief Act of 2007 (H.R. 3648)--but HURRY as this expires in Dec. 31, 2012!
No promissory notes or cash is required to close from the homeowner
$3000 in relocation assistance to the homeowner
$2200 to the servicer for a successfully closed short sale
Up to an aggregate total of $6K to subordinate lien holders to release their liens

Over 80% of primary residences in distress are eligible for HAFA short sales. If you or someone you know is considering a short sale or other foreclosure option, feel free to contact me! If I list your home as short sale, my services to the homeowner are FREE. Visit http://www.NewStartTransitions.com and fill out the contact form for a confidential, no obligation consultation.

I look forward to the opportunity to be of service!

Thanks for reading,

________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

The Local Hampton Roads Real Estate Market and the National Outlook

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Sat, 12 Nov 2011 19:14:00 +0000

Hello Hampton Roads,

The weather has been beautiful recently, and it is a beautiful time to buy real estate!

On the local front home sales are up and prices are down.
According to an article in today's Pilot Online ( http://hamptonroads.com/2011/11/home-sales-jump-prices-decline-last-october), real estate prices continue to fall while home sales are on the increase compared with October last year, up 12.6%, but down 8.2% from September.

Distressed sales in all of Hampton Roads still played a major factor in the market last month, accounting for 33 percent of October's sales. Those sales include foreclosures and short sales (sales by homeowners whose homes are worth less than the balance of their mortgage). REIN, the Virginia Beach-based multiple listing service also reported that the median priced home was $181,000 in October, down 10.6% from a year ago.

On the national front, at the recent NAR annual convention, Dr. Lawrence Yun, Chief Economist of the NAR, and Dr. Richard Peach, Senior Vice President of the Macroeconomic and Monetary Studies Function at the NY Federal Reserve Bank presented their findings:

Investors are supporting the market where cash sales account for between 30%-35% nationally.
Mortgage rates are expected to rise: 4.5% by 2012, 4.8% by 2013 and 5.5% by 2014
Forecasted REO inventory is set to rise over the next 2 years

Read the entire “Economic and Housing Market Outlook” presentation for more insight and information. These are interesting times we are living in and real estate can present an incredible opportunity! Please contact me with any questions regarding buying or selling your home.

I would be honored to help you.

Happy home hunting!

Thanks for Reading,

_____________________________________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Protect Your Home from Declines in Value

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Sat, 12 Nov 2011 18:28:00 +0000

Hello Hampton Roads,

Wouldn't it be great if you could protect your home against declines in value? There's a new kind of insurance out there called Home Value Insurance offered by the Home Value Protection Company which protects homeowners against losses in their primary residence when they sell. Steve Cook wrote a great article about this in the November 10, 2011 issue of Consumer Confidence, Consumer Reports.

Currently the company is only offering this insurance in Ohio and if successful, will expand to other states. So how does it work? For a monthly premium of $35-$45, a homeowner can recoup a loss on the sale of a home based upon the insured value of the home or the drop in local home values as measured by the Fiserv/Case-Shiller Single Family Home Price Index. Claims are limited to a maximum of 25% of the insured value, and there is a deductible during the first two years. In addition, for the policy to kick in, the insured home must sell for less than its protected value and local home values must have decreased during the policy period.

Will this program come to this area? We will see, but a company representative said, "Ten years ago people didn’t believe they needed coverage on the valuation of their real estate. Before 2007, prices had never fallen on a year-over-year basis. Today owners want to protect themselves against future losses."

Have a wonderful day!

Thanks for Reading,

________________________________________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Baby Boomers and Real Estate

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Wed, 19 Oct 2011 17:59:00 +0000

Hello Hampton Roads,

I thought I would share this interesting article with you about investing in real estate.
In his article, "Boomers are Betting on Real Estate," Steve Cook (see full article here: http://www.realestateeconomywatch.com/2011/10/boomers-are-betting-on-real-estate/) indicates that many baby boomers are looking to the real estate market for investment properties, second homes, and even retirement homes. Many are not looking to flip houses, but rather to buy with cash and use rental income as a better return on investment than they could find in the stock or bond markets, or in other investment areas. In an shaky economy, many people turn to hard assets like real estate to preserve value.

Cook bases his findings on information gleened from a national survey of Coldwell Banker agents. Essentially the large majority of surveyed agents said they have baby-boomer clients looking for property due to the incredible value they can find.

There are great deals locally, too. Just for example, I have 2 HUD properties currently available: In Virginia Beach, check out 1020 Autumns Woods--it just had a price reduction to $68,000, and the current assessed value is $107,100! This is a 37% discount to the assessed value!

In Chesapeake look at 217 Shore Side Road, priced at $216,000, but assessed at $270,600--a 20% discount!

To look at all HUD homes in Hampton Roads (and nationwide!) go to www.hudhomestore.com and use the search function. If there are any homes you are interested in, please give contact me to arrange a viewing!

Happy Home Hunting!

Thanks for Reading,

______________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Interesting Foreclosure Statistics

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Tue, 13 Sep 2011 13:52:00 +0000

Hello Hampton Roads,

I hope everyone is having a nice beginning to the week, ready to go after the 9/11 anniversary weekend, plus the first NFL weekend, US Open tennis, World Rugby Championships, etc...

I ran across a very telling article by Steve Cook, "Foreclosures Now Take 20 Months."
It is kind of a good news/bad news article. On the one hand, first-time foreclosure starts were at three-year lows in June, and first-time delinquencies accounted for 25% of new delinquent inventory. Both these indicate a slow-down in the number of properties headed into foreclosure--this would be the good news...

But, because there is so much inventory it will take a long time for all the foreclosed homes to sell--the absorption rate in judicial foreclosure states is 111 months (nine years, three months) given the same sales rate as now. In non-judicial states it would still take long, but not nearly as long as the judicial states, 32 months (two years, eight months). Just so you know, in judicial foreclosure states, the foreclosure must go through the courts, but not so in non-judicial states (Virginia is a non-judicial state). All this is the bad news because it looks like foreclosure properties will be a major factor in real estate sales for the next three to nine years!

Steve also reports some dizzying numbers about US home loans--at the end of June 4.1 million loans were either 90 or more days delinquent or in foreclosure, and foreclosure starts outnumbering sales by a factor of almost three to one--you can see that sales are not keeping up with inventory, so the inventory of foreclosed homes is increasing.

Steve also writes "Also, payments have not been made on the average loan in foreclosure in a record 599 days, or 20 months. Of the nearly 1.9 million loans that are 90 or more days delinquent but not yet in foreclosure, 42 percent have not made a payment in more than a year with an average delinquency of 397 days, also a new record."

It looks like distressed properties are going to be with us for a while. If you need help trying to sell your home, are having difficulty making payments, or want to buy a home, please contact me--I can help!

Thanks for reading and have a great day!

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

How's the Hampton Roads Real Estate Market?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Sat, 10 Sep 2011 23:30:00 +0000

Hello Hampton Roads,

I hope everyone is healthy and happy--I looked outside and hey, it's not raining!

There is a very interesting article in today's Virginia Pilot by Josh Brown--he reports on home sales in South Hampton Roads (includes Chesapeake, Norfolk, Portsmouth, Suffolk, Virginia Beach).

Here are the findings in a nutshell:

Year over year sales are up but the median sales price is down.
Median sales price has declined for the last 9 consecutive months when compared to the same time last year.
Distressed property sales (foreclosures and short sales) have increased from 25% last year to 29% this year.

There were 1080 homes sold last month (up 2.5 percent from July and 18.6 percent from August 2010) at a median price of $199,900 (down 7 percent from August 2010). Also the total number of homes sold this year through August is up from the same period last year.

The volume of homes being sold is certainly better and this can be attributed to investors coming into the market and buying and flipping homes. The lower end of the market is certainly active but there are deals that can be found in every price point! Whether investing or looking for a great deal on your primary residence, the profit or equity potential is made when you buy.

As always, I am available to help you with your housing needs. Feel free to contact me and let me know how I can be of service!

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

First Time Home Buyers Grants for the Military

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Thu, 08 Sep 2011 20:16:00 +0000

Hello Hampton Roads,

I hope you all weathered Irene okay and are transitioning easily from summer to fall!

I wanted to pass along a great opportunity for active duty personnel, veterans, retired military, or homeland security employees-- up to $5,000 in grant money for first time home-buyers!
Essentially, the funds can be used for down payment and closing costs, and in addition to being in the military and being a first time home buyer, there are income limits which must be met. Gross income can be no more than $55K/yr or no more than 80% of your community's median based income, based on family size.

For our area, FY 2010 Income limits are a median income of $68,200 and an income limit of $54,550 for a family of four. This holds true for all seven cities of Hampton Roads.

The way it works is that an applicant must contribute at least $500 of his or her own funds and the Dream Makers Grant will match those funds 3 to 1. The applicant's down payment with the Grant must equal to a 3% down payment based on the purchase price. Another great thing about this grant is that it can be used with any 30yr fixed rate mortgage from a financial institution of your choice!

You can apply online or download an applicantion and fax or email it.
http://www.pentagonfoundation.org/site/PageServer?pagename=dream_index

Interest rates are as low as ever and now is a great time to take advantage of this opportunity!

If you need help or have any questions, please contact me.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

What is a QRM (Qualified Residential Mortgage) and What Does it Mean to Me?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Mon, 13 Jun 2011 21:58:00 +0000

Hello Hampton Roads,

A QRM or "Qualified Residential Mortgage" is a mortgage that fits the following criteria:

The lender does not have to hold 5% of the loan amount they originate on their books
The loan can be securitized--meaning it can be sold on the secondary market

In order for a loan to have QRM status and the crux of the controversy is the proposal for a 20% down payment requirement which would not bode well for the housing market. This is problematic because it will force those who can't meet this stringent requirement to get more expensive loans or exit the market entirely. Research has shown that a large down payment doesn't correlate with loan default. A better way to insure loan repayment is to have good underwriting rules.

Additionally, requiring a 20% down payment affects lower income borrowers more, and since minorities are over represented in lower income groups, it will unfairly affect these groups.

First-time home buyers would also be negatively affected--87% of first-timers put down less than 20% over the past five years. But repeat buyers are also affected--65% put less than 20% down.

Data shows that it would take the average family 14 years to save 20% down for the average home (see white paper below).

The QRM rules don't affect FHA or VA loans, so these loans will likely become more popular, which means the government will be more involved rather than less.

The new rules will come into effect one year after they are passed.

You can learn more by reading the white paper, found on the NAR's website or by watching the following video:

Video:

Banking regulators' proposed rules for defining a qualified residential mortgage would devastate the housing market, NAR research shows:

http://link.brightcove.com/services/player/bcpid1785312249?bclid=1740033302&bctid=973945347001

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

How's the Real Estate Market in Hampton Roads?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Tue, 15 Mar 2011 21:04:00 +0000

Hello Hampton Roads,

Whether you own a home or are thinking about buying, everyone wants to know how the real estate market is doing. The article about area home sales and foreclosures in The Virginian-Pilot today sums it all up. The author, Josh Brown, wrote that the number of existing homes (as opposed to new home construction) sold in February was up about 3% from January, to approximately 700 homes. This number is up 20% from January 2010. Also, almost 3 of 7 homes, or 42%, were either bank-owned (REO) or sold for less than the seller owed on the mortgage (short sale).

These numbers account for the highest percentage of distressed property sales (REO and short sale) ever for South Hampton Roads. Last month had the previous record of 39%. By comparison, in February 2010 the percent was 25.

Other market indicators include the median sale price, which was $184,900, essentially the same as January 2011, but down 5.8% from February 2010.

The total number of homes on the market for February was 14,170, up about 1% from January and 1.6% from February 2010. That number indicates about 10 months of inventory, while 6 months is considered normal. Distressed properties, which includes REO and short sale homes, comprised 23% of all homes for sale.

What does this all mean? Simply put, foreclosures and short sales continue to bring prices down and while these homes accounted for 23% of homes on the market, they were over-represented among homes sold--42%. If you are a buyer, there will continue to be bargains out there, and if you are a seller, you are competing with short sale and foreclosure homes, and your home may be on the market longer than normal.

If you want to talk with a professional with lots of experience in the "normal" resale market, and in REO and short sale homes, please call me, Liz Schuyler, at 757-235-0274 begin_of_the_skype_highlighting 757-235-0274 end_of_the_skype_highlighting, or email me at liz.schuyler@rmxtalk.com. I am happy to talk with you about your real estate needs!

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Why You Should Buy A Foreclosure Home in Hampton Roads

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Wed, 02 Mar 2011 18:36:00 +0000

Hello Hampton Roads,
There are Bargains to be found in today's market! Check out the video below and be sure to sign up for your FREE List of Foreclosure properties and bank owned homes in Hampton Roads.

Are you ready to find your next home?

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Can I Get a Mortgage After a Short Sale?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Fri, 11 Feb 2011 23:08:00 +0000

Hello Hampton Roads,

Can I get a mortgage after a short sale?

Not to keep you waiting too long, the answer is "yes", but since a short sale will damage your credit, you will need to do what you can to help improve your credit score and continue paying your other creditors. It's a good idea to get a copy of your credit report from all 3 credit rating agencies and do what you can to lower your debt to income ratio. The better your score, the better your rate and the more likely you will be able to purchase again.

Let's take a look at the time frames you will have to wait after a short sale; this varies by the type of loan.

For example, you need to wait two years before you can buy another home if you use VA financing.

For an FHA loan, the wait is three years.

For a conforming (within the loan limits) conventional loan, it is two years if you have a maximum of 80% loan to value, five years if you have between 80% and 90% loan to value, and seven years if you have greater than 90% loan to value (loan to value is the amount of the loan compared to the value of the property).

For conventional non-conforming (anything over the Fannie Mae or Freddie Mac loan limit-$458,850 in Hampton Roads, VA) loan, the wait is seven years.

For comparison, if you foreclose on your home, to get a VA or FHA loan the wait is the same as if you sell short, two and three years. For conventional loans, you must wait seven years after foreclosure.

If you want more information about foreclosures or short sales, whether buying or selling, please contact me. I look forward to helping you meet your property transaction needs!

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

New Homes in Virginia Beach Under $200,000

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Wed, 12 Jan 2011 20:54:00 +0000

Hello Hampton Roads,

Are you looking for new homes in Virginia Beach under $200,000?
In this buyer's market it seems like everyone is looking for a bargain and affordable new construction is one of the most sought-after. Although there aren't many homes that match this criteria, there are a few. To give you an idea of what is currently available check out the listings below:

Note: click on the pictures to get an enhanced view

The new construction in South Moor in Ridgley Manor fits the bill--new condos priced well below $200K.

If you are willing to look at condos that are 3 years old you can live in the heart of Towne Center at Studio 56 for less than $200K. There are 2 properties available now.

For detached single family homes we have to look at new construction, 5 year and newer and we see just 2 homes avaible for sale for under $200K.

If you would like information about any of these homes or others, please feel free to contact me! I'm happy to help.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

The Hampton Roads Real Estate Market At The End of 2010

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Mon, 10 Jan 2011 02:19:00 +0000

Hello Hampton Roads,

How did the Hampton Roads real estate market do at the end of 2010? When I look at the Hampton Roads housing market, I like to consider the indicators below to gauge the temperature of the market and advise my clients on the best strategy whether they are buyers or sellers. Let's take a look at these indicators:

Inventory
Median Sales Price
Absorption Rate
Distressed Property Sales

Our MLS recently released statistics from the end of last year; let's take a look at each.

Inventory
The Inventory of Listings includes number of Active, Pending & Sold listings compared from the same time last year. The number of homes for sale has increased as has the number of pending homes (homes under contract) but the number of homes sold has decreased.

Median Sales Price
For the year 2010, the median sales price for homes in Hampton Roads declined 1.38% while comparing December 2010 to December 2009, the decline is steeper at 5.5%.

Absorption Rate in Months
The Absorption Rate--the amount of time it would take to sell all the homes on the market if no other property was listed. In all of Hampton Roads there is currently about 9.7 months of inventory on the market which is an increase of 19.6% from December a year ago (2009). See the table below for current absorption rates for each of our 7 cities:

In each case the absorption rate has increased from December a year ago. When we start seeing a decrease in these numbers more towards a 6 month absorption rate we will know we are in a balanced market but with increasing time frames, the buyer's market is holding firm.

Distressed Property Sales
The presence of Distressed Property Sales are those sales which are foreclosures or short sales. The percentage of distressed property sales accounted for 35.3% of all homes sold in the region and 25% of all homes actively listed.

With the shadow inventory (foreclosed homes that are not yet on the market) from banks expected to come on the market, this current trend will probably continue in 2011. However, it is important to remember the real estate market is cyclical and no matter where you are in the cycle there is always opportunity for those ready, willing and able to take advantage of it.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

What is the Best Inflation Hedge?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Thu, 06 Jan 2011 18:34:00 +0000

Hello Hampton Roads,

What is the best inflation hedge you ask?

Today more and more people are talking about inflation--we can see it already in the higher prices for food (and smaller sizes--heck, the 7-Eleven Big Gulp is 4 oz smaller!) and gas (crude is over $90/barrel) and not to mention, the stellar rise in price of gold and silver. The best hedge against inflation is to buy tangible assets, and since this is a real estate blog, that would be buying houses.

Buy the best house that you can afford. It's value will likely keep pace with inflation over the long term and the interest on the mortgage is tax deductible. Billionaire John Paulson, famous for betting against the housing market in 2007, also shares this sentiment. In a recent speech at the University Club in New York City, Paulson is quoted:

"If you don't own a home, buy one." Paulson said. "If you own one home buy another one, and if you own two homes, buy a third and lend your relatives the money to buy a home."

Buying a home today will lock in debt at low levels of interest while being paid back with cheaper, devalued dollars (see Sidebar below). In the short, intermediate term, I believe housing prices will fall due to the glut of inventory on the market and downward pressure from distressed property sales, but in the long term, prices will rise again.

Sidebar: Regarding interest rates, the 30-year fixed-rate mortgage average declined to 4.77% from 4.86% last week, and the year-ago average was 5.09%. Also all this QE (Quantitative Easing) increases the money supply making each dollar worth less.

Thanks for Reading,

_________________________

Serving your Hampton Roads and Virginia Beach Real Estate needs.

REO Real Estate Agent Virginia Beach

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Mon, 03 Jan 2011 20:00:00 +0000

Hello Hampton Roads,

Are you looking for an REO real estate agent in Virginia Beach?

With delinquency rates above their historic average in both prime and sub-prime markets, REO and Short Sales still dominate the market. The process for purchasing a foreclosed home is very different than purchasing a regular re-sale home and it is important to have an experienced REO real estate agent to guide you and I can help!

From my experience in both listing and selling REO homes, I can provide you with foreclosure listings and the steps needed to take in order to buy one.
Be sure to read my post entitled: Things I Should Know About Purchasing an REO Home

Currently in Virginia Beach alone, there are 397 REO and Government Owned Homes listed. Click this link to receive your free Foreclosure List.

Thanks for Reading & Happy New Year!

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Free Listings of Foreclosed HUD Homes

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Tue, 28 Dec 2010 01:16:00 +0000

Hello Hampton Roads,

Are you looking for free listings of foreclosed HUD homes in Hampton Roads?
Foreclosed HUD homes represent another great source for properties for both home buyers and investors. HUD foreclosures are homes that were obtained by an FHA mortgage where the homeowner has defaulted on payment and the ownership of the home has reverted to HUD. Just like bank owned foreclosures, HUD homes can represent exceptional values and they are also sold "As Is", which means the home is sold in its current condition.

HUD has a very specific procedure for bidding on homes and the bidding must be done through a HUD registered broker--I am qualified to sell HUD homes. If you do not have a broker, I can guide you through the process from searching for a home through closing.

If you would like to do your own search, the first place to look is on the HUD Home Store site. New properties can come on the market daily and it is simply a matter of finding homes that match your criteria. You can search for a specific home or do a general search within a particular city. If you find a home and would like more details, please contact me and I can email you the listing. If you would like to have listings emailed to you, you can fill out the form below:

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Advice On Getting a Mortgage

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Wed, 20 Oct 2010 22:42:00 +0000

Hello Hampton Roads,

The only thing we can count on in this market is change, and with that I'd like to talk about changes in the mortgage industry and offer advice on getting a mortgage. It's a lot harder to get a loan now and there's definitely some things that as a buyer, you should not do when applying for a loan. I learned some great information today from our company's in house lender, Brad Shoemaker with Southern Trust Mortgage .

The only constant is change, continuing change, inevitable change, that is the dominant factor in society today. No sensible decision can be made any longer without taking into account not only the world as it is, but the world as it will be. --Isaac Asimov

First, here's a few highlights on how the getting a mortgage has changed:

No more stated income loans
No more NO DOC loans
Very limited 100% financing options (VA, VHDA, FHA Plus, & special grant programs)
Minimum 620 credit score (Many institutions are now requiring 640 minimum)

Next, here's some sage advice on what NOT to do when you are getting a home loan:

Don't change jobs
Don't change banks or move money around
Don't make major purchases
Don't close credit card accounts or apply for new credit
Don't deposit cash that can't be documented

If you have any questions about home buying in general, feel free to contact me and I'd be happy to help!

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Relationship Between Treasury Notes & Mortgage Rates

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Sat, 16 Oct 2010 22:34:00 +0000

Hello Hampton Roads,

It's no secret that the Hampton Roads housing marking is advantageous for today's home buyer! Inventory is aplenty and mortgage rates are at incredible lows. The average mortgage rate on a 30-year fixed loan dropped to 4.19% this week, down from 4.27% last week, according to Freddie Mac. The average rate on a 15-year mortgage is also down to 3.62% from 3.72%. With rates this low a buyer can buy a lot more house for the money or a current home buyer may be able to save more by refinancing.

Speaking of interest rates, have you ever wondered about the relationship between treasury notes and mortgage rates? I knew you had! The answer is that they follow the same trend--when treasury yields are higher so are interest rates on fixed rate mortgages.

Here's the scoop: Treasury notes are sold via auction by the US Treasury Department. Treasury notes and bonds are denominated by number of years; one of the most popular is the 10-year note (notes are 10 years or fewer). Treasury bonds usually have a 30-year term. The 10-year note affects 15-year conventional loans, while the 30-year bond affects 30-year conventional loans.

How?

As investors seek higher yields they look to investments that generally have higher risks. Thus enters the mortgage backed security for investors who want to invest in higher yielding mortgages. As treasury yields rise, in order to attract investors, the rate on the mortgage backed security also rises which means higher rates for the borrower. The opposite holds true as well.

Treasuries (notes and bonds) are sold at a set face value and interest rate. If the auction goes well and there is a high demand for the treasuries the yield is low whereas if auction activity is sluggish, buyers will pay less than face value of the treasuries and yield is higher. If note or bond prices rise this means yields are low and interest rates on mortgages will be low. Buying a home becomes more affordable for most buyers--first time home buyers and move up buyers. Conversely if note or bond prices fall, this means higher yields and therefore higher mortgage rates. Housing affordability will drop and it will be more expensive to buy either first homes or move-up homes.

In summary, treasury yields and fixed mortgage interest rates move in the same direction. If treasury yields increase then mortgage rates increase, and if yields drop, look for interest rates to go down in the future.

Thanks for taking the time to read this post and if you have any questions please feel free to contact me!
Happy Home Buying!

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

Bank Loan Interest Rates for Home Loans

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Wed, 08 Sep 2010 20:26:00 +0000

Hello Hampton Roads,

Let's talk about bank loan interest rates for home loans! Interest rates are at historic lows and according to Bankrate.com , rates currently sit at 4.50% for a 30 year fixed mortgage. Rates this low provide us with the ability to buy more house with the same income—it's almost like getting a raise if you are in the home buying market!

Here is a quick example:

Lets compare today's rate of 4.50% for a 30 fixed loan, with that of a 6.5% rate (a rate which many of us were more than happy to have—maybe some of you remember the 10% plus rates a few decades ago!) for a $176,900 mortgage. The $176,900.00 amount is used because it is the national median sales priced home in the U.S.

At 6.5%, your monthly mortgage payment of principal and interest (not including taxes and insurance) would be $1,018.13.

At 4.5%, your payment would be $896.33! That is a difference of $121.80 a month or $1,461.60 a year! Or put another way if you can afford a payment of $1018.13 for principal and interest this is like buying a home priced at about $200,000.00.

Who would have thought that the biggest housing crash in history would coincide with the lowest interest rates for home loans?

If you need to buy a home now may be the perfect time to do so and get the biggest bang for your buck! It may be time to consider buying a new home while these low interest rates allow you to buy more house than perhaps you thought possible. However, don't buy to speculate on housing prices hitting a meteoric rise like they did prior to the housing bubble. Prices are likely to remain flat in the near future.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

FHA MIP

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Tue, 17 Aug 2010 18:47:00 +0000

Hello Hampton Roads,

An FHA loan allows buyers who have good credit but who may not neccessarily have the 20% downpayment required for a conventional loan to purchase a home. For this benefit, HUD charges an upfront MIP (mortgage insurance premium) that buyers are required to pay when they get an FHA loan. These funds are pooled in FHA's Mutual Mortgage Insurance Fund which is used to protect investors against default since HUD guarantees FHA loans and protects a percentage of the lender's investment. Due the number of defaults, this Mortgage Insurance Fund is undercapitalized and the rules for the FHA MIP are changing to help shore up the fund.

As of Oct. 4, 2010 buyers will pay a smaller upfront mortgage insurance premium, but higher monthly premiums effectively paying more in the long run. Under the new rules, assuming a 30-year fixed rate FHA mortgage with a minimum of 5 percent down:

Upfront MIP drops to 1.000% of the amount borrowed from 2.250% (100 basis point decrease)
Annual MIP increases to 0.850% of the amount borrowed from 0.500%

For example, for a $100,000 mortgage, the upfront MIP falls to $1,000 from $2,250; monthly MIP jumps to $70.83 from $41.67. The FHA expects the change will yield an additional $300 million in premiums monthly.

A great article to read more on this is Look What’s Happening to FHA Mortgage Insurance!

If you are considering buying a home in this market, if may benefit you to do so before the rules change.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.

How do I find a HUD home in Virginia?

noreply@blogger.com (Liz Schuyler, Virginia Beach Real Estate Agent) — Thu, 05 Aug 2010 12:10:00 +0000

Hello Hampton Roads,

HUD homes are a popular choice in today's market. Perhaps you have wanted to know more about them and how to find them in your area. "How do I find a HUD home in Virginia, or specifically in any of the cities of Hampton Roads?

First let's start by defining what a HUD home:
HUD homes are foreclosured homes that were insured by an FHA mortgage and are now owned by the Dept. of Housing and Urban Development (HUD). Like other foreclosed properties, these homes can be terrific values and are attractive to both home buyers and investors alike.

Finding a HUD home in Virginia is easy:
You can ask your Realtor as these listings are typically found in the MLS and you can also check directly on HUD's website . Simply select your city of interest to view a list of all available properties along with the property details provided by HUD, including any type of property condition report or environmental report that may be attached. Since HUD homes are sold strictly "AS IS WHERE IS" without warranty as to condition, please note that these reports are for informational purposes only. In addition, new listings are posted weekly on Friday mornings so you know exactly when to check for new inventory!

Your Realtor can show you any available homes and can assist you with submitting an offer.
It is important that you work with a Realtor who is familiar with HUD homes and the home buying process as HUD has very specific instructions about submitting bids and paperwork. Any delay or mistake could cost your offer to be bypassed as HUD has no qualms about moving to the next bid if there are mistakes or if paperwork is not received on time.

If you are interested in finding out more about HUD homes in general or would like to view HUD properties, please contact me at 757-235-0274.

Thanks for Reading,

_________________________
Serving your Hampton Roads and Virginia Beach Real Estate needs.