“What you can do or dream you can do, begin it; boldness has genius, power, and magic in it” 

-Johann von Goethe: Was a German poet, novelist, and dramatist

MORTGAGE RATES PLUNGE, HISTORIC LOWS

REALTORS, this is a great opportunity for you to check-in with your clientele going back 2 years. Rates are at a historic low! Even if your client thinks they’re at the lowest rate possible, tell them to contact me just for 5 minutes of their time to make sure they are. They can likely save money on their monthly mortgage payment!

Zackry Cooper: 925-295-9350

NEW YORK (CNNMoney) — As Congress and President Obama hammered outa debt deal over the past week, mortgage rates plunged — hitting new lows in some instances.

The 30-year fixed rate, usually the most popular choice for homebuyers, fell to 4.45% from 4.57% last week — its lowest point since last November, according to the Mortgage Bankers Association.

Meanwhile, the rate on the less popular 15-year fixed plunged to a new record low of 3.52%, down from 3.67% a week earlier.

The up-front points lenders charged dropped as well, to 0.78 from 1.14 for 20%-down loans, according to the industry group.A homebuyer financing a $200,000 mortgage could save $14 a month and pay $720 less at closing based on the current points.

The rock-bottom interest rates drove up total mortgage applications — both for purchases and refinancings — by about 7%, compared with a week earlier, said Michael Fratantoni, the Mortgage Bankers Association’s vice president of research and economics. While the increase may seem substantial, he noted that applications are still well below last year’s level.

“Refinance application volume increased, but even though 30-year mortgage rates are back below 4.5 percent, the refinance index is still almost 30 percent below last year’s level. Factors such as negative equity and a weak job market continue to constrain borrowers,” he said.

Responsible homeowners left out in the cold

On Bankrate.com Wednesday, a 30-year fixed was available that carried an annual percentage rate of just 4.03%. The overnight average was 4.37%, the site reported.

Mortgage rates are following bond yields lower, explained Greg McBride, Bankrate’s chief economist. The yield on 10-year Treasury notes hit 2.6% on Wednesday down from 3.03% the last week of July.

“The plunge in Treasury yields is because we’ve been hit with a string of poor economic readings,” said McBride.

Those include a weak GDP report and slowdowns in manufacturing, consumer spending and hiring.

Job killing companies

With rates so low and home prices down more than 30% from peak, there has probably never been a more affordable time to buy a home.

For some buyers though, “Time is of the essence.,” said McBride. “The loan limits (for Fannie/Freddie mortgages) drop on October 1 so acting now for closing by Sept. 30 is important for buyers in the upper price levels.”

5 QUICK TIPS FOR AUGUST 2011

1. Price it Right From the Start

It is crucially important that we try our best to price our listings correctly right out of the gate. We know it is difficult in today’s volatile market to place the correct price on any property. However, the consequences to the seller if we don’t do this can be severe for two reasons. First, in a market where prices continue to decline, any additional time taken to sell the home only means a lower selling price. The other reason: research has shown that properties that have experienced price adjustments wind up taking longer to sell and sell for less money no matter what the current market conditions are.

2. Window of Opportunity

While the banks are trying to correct and substantiate their foreclosure paperwork, large inventories of distressed properties coming to market have been delayed. That gives our current listing inventory a ‘window of opportunity’ to sell before the additional downward pressure of these distressed properties is felt.

3. Conforming Loan Limits

It will take an act of Congress to keep loan limits from falling on government backed jumbo loans in many of the higher priced regions in the country this October. This will result in consumers paying as much as ½ to ¾ of a point more on the rate of their 30 year mortgage.

4. August is a Great Time for Education

The two best months for real estate professionals to take education are August and December. These months rank 11th and 12th in regard to transaction counts in most markets. That means that the time invested in taking a class in either of these months is less expensive when factoring in possible lost business. You may decide to take a single class, take classes toward a designation or increase a skill set such as photography or enhancing your social media presence. August is a great time for investing time to make yourself more proficient in a certain aspect of real estate.

5. Remember, it’s up to YOU

Let’s keep it simple. Your success is determined by one and only one thing: your commitment to it. Don’t just want success – BE COMMITTED TO IT!

 

TOP PRIORITIES OF FIRST-TIME HOME BUYERS

First-time home buyers make up a big chunk of home buyers. So what are their top priorities when shopping for a home? Bankrate.com recently featured “must-haves” for first-time home buyers. Here are a few top priorities:

Affordable price. “Unlike a trade-up buyer, they don’t have any equity to roll into the purchase of their next home, so coming up with a down payment and the financial aspects of buying a home is the first concern,” says Paul Bishop, vice president of research for the National Association of REALTORS®. Fortunately, home affordability is at one of its highest in years and a large inventory of homes on the market provides plenty of options, which is helping first-time buyers find a good home at a great price.

Room to grow. Ken Shuman, Trulia.com spokesman, says that first-time home buyers often find its smart to search for a first home that not only accommodates their needs now but one that can accommodate them in 10 years, too. Space to accommodate growing families will likely be a higher priority than upgrades, such as granite countertops, Shuman says.

Turnkey. Surveys have recently shown first-time home buyers showing a preference for homes that are in move-in condition and in stable neighborhoods, rather than fixer uppers in depressed neighborhoods. In evaluating whether a home has been well-maintained, MacDonald suggests watching for such things as rotten trim on the exterior, dirty air-return ducts or a dirty filter in the HVAC system, or a damaged roof or gutters.

BIG CHANGES COMING FOR APPRAISALS. WHAT RPM HAS DONE TO KEEP YOU AHEAD OF THE COMPETITION.

RPM owns and operates its appraisal services, it’s known as ASI (Appraisal Services, Inc.). Many changes have occurred in the appraisal industry over the last two years with even more to come.

 

CHECK OUT FLYER

Starting September 1, the way appraisers report their findings and the way they deliver a report will change. UAD stands for Uniform Appraisal Dataset which is the first part in a series of changes for how the overall loan is delivered to the GSE’s. They are doing this to make the appraisals more standardized as to what an appraiser might consider good condition in Texas is vastly different than what an appraiser in Connecticut might think. There are a total of 72 additions to the form with 60 being mandatory and 12 being optional. Phrases like neutral, beneficial and adverse will become standard. Very Good, Good and Average will be replaced in condition and quality fields with a 1 through 6 rating with 1 being exceptional and 6 being horrible. ASI has completed courses, seminars and webinars to help educate the appraisers on these changes, assist the underwriters, and to answer your questions when you see the new forms. Appraisals will also have to be delivered in both a PDF and XML format.

Some of the important changes are:

1) FHA and VA are also using the UAD reports but not the delivery method

2) Appraisals MUST be sent to the GSE’s before the loan for conventional and jumbo loans (Not FHA or VA)

3) If the lender orders a field review that review is sent with the loan and not the original appraisal

4) If an appraisal is sent to the GSE’s in the new format incorrectly it will be kicked out and deemed unacceptable

5) GSE’s wont accept a C5 or a C6 rating for condition

6) Any C6 issue makes the whole property a C6 rating unless subject to repair

Make no mistake these are major changes in the appraisal world in both reporting and technology. As a Realtor who uses Zackry Cooper you will have a huge advantage over your competition because we are working on ways to streamline it, and guarantee the reports acceptance into the GSE system.

Here is a link to a webinar if you would like to familiarize yourself with the changes. Click Here

THANK GOD I DIDN’T BUY GOLD AT $400 AN OUNCE

We hope that headline grabbed you. The reason we used it was to bring some perspective to the debate as to whether or not homeownership is a wise investment in today’s troubled market. A family should never look at the purchase of a home simply as a financial investment. It is so much more than that. But, even if we look at it as only an investment, we must look at it in the long term. Let’s use gold as an example.

Gold had dropped from over $400 an ounce to $250 an ounce (a 40% decline) from February 1996 to August 1999. People were so glad they hadn’t bought at $400 an ounce.

Lord William Rees-Mogg, the current Chairman of The Zurich Club, in 1997 said:

“No investment has been so thoroughly exploded as gold; most people think that there will no more be another gold boom than there will be another boom in tulip futures in The Netherlands.”

Everyone knows what happened next. The proclamation of gold’s death was rather premature. Gold rose from $250 an ounce to over $1,500 an ounce in the next twelve years.

If we look at real estate in the long term, we can see that it has been a great vehicle for building family wealth. The Federal Reserve’s Survey of Consumer Finances, conducted once every three years, provides a snapshot of family income and net worth. Their survey has shown every time that homeowners’ net worth far exceeds that of renters. Here is the breakdown of the last several surveys:

1998 – Homeowner net worth exceed renters by 31x

2001 – Homeowner net worth exceed renters by 36x

2004 – Homeowner net worth exceed renters by 41x

2007 – Homeowner net worth exceed renters by 46x

The 2010 survey is not out yet but the National Association of Realtors’ has estimated that number to be approximately 41x in 2010. You may be thinking this is no longer the case based on the current fall in home values which have dropped back to 2000 – 2002 prices.

Harvard University just completed a study that showed:

“Even if homeowner wealth fell back to 1995 levels, it would still be 27.5 times the median for renters.”

Bottom Line

We are not predicting that real estate will see the same levels of appreciation that gold did. However, we do believe that the real estate market will rebound strongly.

“Human beings, by changing the inner attitudes of their minds, can change the outer aspects of their lives.”

-William James: Was a philosopher and psychologist

 

REALTORS:

REALTOR ONLY CALL WITH RICK RUBY’S PARTNER – REETA CASEY

Bring your lunch and join us for an exclusive conference call with Reeta Casey

TOPIC: “Expand Your Prospecting”

(Also: Happy Hours, Expired’s, Open Houses, and Questions/Answers (please prepare questions for Reeta)

WHERE: 2175 N. California Blvd, Ste. 315. Walnut Creek, CA 94596 (Conference Room – 3rd Floor)

WHEN: Wednesday August 3rd, 2011

TIME: 12:00 pm – 1:00 pm (please arrive at 11:30 am)

RSVP Today with Sherrell

Phone: 925-296-3840 or E-mail: sayers@rpm-mtg.com  (Due To Limited Seating You MUST RSVP)

Reeta Casey Website

Zackry Cooper Website

Rick Ruby Website

 

BIG CHANGES COMING FOR APPRAISALS. WHAT RPM HAS DONE TO KEEP YOU AHEAD OF THE COMPETITION

RPM owns and operates its appraisal services, it’s known as ASI (Appraisal Services, Inc.). Many changes have occurred in the appraisal industry over the last two years with even more to come.

CHECK OUT FLYER

Starting September 1, the way appraisers report their findings and the way they deliver a report will change. UAD stands for Uniform Appraisal Dataset which is the first part in a series of changes for how the overall loan is delivered to the GSE’s. They are doing this to make the appraisals more standardized as to what an appraiser might consider good condition in Texas is vastly different than what an appraiser in Connecticut might think. There are a total of 72 additions to the form with 60 being mandatory and 12 being optional. Phrases like neutral, beneficial and adverse will become standard. Very Good, Good and Average will be replaced in condition and quality fields with a 1 through 6 rating with 1 being exceptional and 6 being horrible. ASI has completed courses, seminars and webinars to help educate the appraisers on these changes, assist the underwriters, and to answer your questions when you see the new forms. Appraisals will also have to be delivered in both a PDF and XML format.

Some of the important changes are:

1) FHA and VA are also using the UAD reports but not the delivery method

2) Appraisals MUST be sent to the GSE’s before the loan for conventional and jumbo loans (Not FHA or VA)

3) If the lender orders a field review that review is sent with the loan and not the original appraisal

4) If an appraisal is sent to the GSE’s in the new format incorrectly it will be kicked out and deemed unacceptable

5) GSE’s wont accept a C5 or a C6 rating for condition

6) Any C6 issue makes the whole property a C6 rating unless subject to repair

Make no mistake these are major changes in the appraisal world in both reporting and technology. As a Realtor who uses Zackry Cooper you will have a huge advantage over your competition because we are working on ways to streamline it, and guarantee the reports acceptance into the GSE system.

Here is a link to a webinar if you would like to familiarize yourself with the changes. Click Here

 

TO SAVE HOME VALUES, BILL ASKS BANKS TO RENT FORECLOSURES

As a glut of foreclosures on the market weighs down home values across the country, a bipartisan bill introduced this week in the House proposes a solution to reducing the high inventories: Rent the properties out.

The proposed bill, Neighborhood Preservation Act of 2011 (H.R. 2636), calls on banks and the government-sponsored enterprises–Fannie Mae and Freddie Mac–to start renting out some of their foreclosed properties to reduce REO sales and “stabilize home values and restore confidence in the housing markets.”

The bill would authorize federally chartered institutions to enter into a long-term lease–for up to five years–with the occupant of the property or with another person, and then at the end of the agreement provide an option to buy the home to the tenant.

The bill could allow delinquent borrowers to remain in their homes but they would have to agree to pay rent and still sign over the deed to the bank or GSE, National Mortgage News reports.

According to the bill, this would allow the foreclosed property to remain occupied during the still-sluggish housing market and “preserve the property itself as well as the aesthetic and economic values of neighboring homes and even whole neighborhoods.”

“As Americans across the country are affected by this unrelenting foreclosure crisis, it is imperative that Congress address this issue,” Congressman Gary Miller, R-Calif., who introduced the bill, said in a statement.

 

“If you aren’t fired with enthusiasm, you will be fired with enthusiasm.” -Vince Lombardi: Was a football coach and speaker

 

 

REALTORS:

FREE EXCLUSIVE SPEAKING EVENT ON MONDAY JULY 25, 2011

SPEAKER: Rick Ruby of The CORE Training, Inc. (Also Zack’s personal coach for the last 2 years)

TOPIC: “How To Turn Buyers Into Closed Transactions And Exceed Your Goals for 2011”

Click on image for more information and to RSVP TODAY (Click on Realtor Tab)! (Due To Limited Seating You MUST RSVP)

Zackry Cooper Website

Rick Ruby Website

The CORE Training, Inc. Website

 

FHA’s NEW RULES: MORE PAIN FOR CONDO MARKET

Is the Federal Housing Administration taking a back-door exit away from condos — a key real estate segment in which it’s recently built up market shares of 40 percent and higher in many urban areas?

Could the agency be tightening its rules in order to cut loan volume in the months ahead, potentially putting thousands of unit sellers, buyers, homeowners associations and realty agents in a mortgage-money squeeze?

FHA adamantly denies that it’s doing anything of the sort, and insists that new rules rolled out at the end of last month represent prudent responses to the serious risks the agency’s insurance funds confront.

But condo industry executives and community managers say FHA’s tougher regulations have a wet-blanket effect on associations’ ability — and willingness — to get their projects approved for financings by the agency. Without an entire project certified, potential buyers of units cannot obtain FHA-backed loans, which in turn makes it more difficult for current unit owners to sell and could depress property values.

FHA’s low down payment minimums — 3.5 percent — and relatively generous credit and debt ratio policies have made it the go-to financing source during the past several years for moderate-income buyers who previously would have sought conventional mortgages. With high-cost-area mortgage limits of $729,750 — at least until Oct. 1, when they are scheduled to drop — FHA has even become a player in some upper-end condo communities.

The biggest complaint about the new FHA rules, is the requirement that anyone who signs an application for certification or recertification of a project must assume full responsibility under federal law for the accuracy of every piece of information contained in the submission.

The penalties for subsequent findings that information was inaccurate or omitted can be severe — ranging up to $1 million in fines and 30 years in prison for the worst infractions.

Since the certification package submission covers myriad items that can be difficult to pin down precisely — such as the percentage of units currently occupied by renters on a given date, or whether project documents are in full compliance with every state law and regulation — many association boards and managers are reluctant to stick their necks out to guarantee accuracy of the unknowable under threat of future federal fines.

Condo boards, unit owners and managers also are upset by other rules from FHA, including:

1. A Requirement that no more than 15% of all units in the profject are no more than 30 days delinquent on their condo assessments, including bank-owned (REO) units, which are notorious for nonpayment of fees.

Often condo boards can’t even determine who actually owns a foreclosed unit, said Andrew Fortin of the 30,000-member Community Associations Institute trade group, “so how can FHA expect volunteer condo boards to find this information and collect the assessments?”

Worse yet, he said, most boards or management companies don’t learn about delinquencies on assessments until well after 30 days.

Plus, FHA’s new rule conflicts directly with some state laws, such as in North Carolina, where boards are prohibited from even seeking to collect fees until they are more than 30 days delinquent.

2. A Requirement that not only must condo boards carry fidelity insurance on their officers, but that management companies must carry policies as well.

According to Fortin, that requirement conflicts with state law in Maryland, where condo boards already must purchase fidelity insurance for their management companies. Under a strict reading of the rules, he said, that means management companies will be forced to buy what amounts to double coverage.

3. A variety of technical rules that may hamper condo conversions and so-called gut rehabs.

For example, Philip Sutcliffe, principal of the condominium consulting firm Project Support Services, said FHA’s new rule requiring full, professionally prepared studies of financial reserves will be too expensive for many projects to afford. Sutcliffe said he sometimes wonders whether “anyone at (the U.S. Department of Housing and Urband Development) truly understands how condominiums work in the real world.”

As a consequence of these and other concerns about the new rules, recertifications of existing condo projects for FHA mortgage insurance are lagging. An FHA official confirmed to me that just 1,000 of approximately 12,000 projects eligible have done so in recent months — a no-show rate that critics call ominous.

In response, FHA officials argue that most of the agency’s rules track similar requirements in the conventional financing marketplace. Moreover, they say, at a time when condo projects have taken especially hard hits in the housing downturn — and many projects in places like Florida, Arizona and Nevada have experienced soaring rates of delinquency and foreclosure — they have a duty to protect FHA’s insurance funds against avoidable losses.

Asked whether a calculated phasedown of FHA’s condo volume lurks behind the toughened rules, Lemar Wooley, a spokesman for the agency, said “that is not the case. FHA is committed to continuing its mission of providing affordable, sustainable homeownership opportunities while managing and mitigating risk. Our new condo guidance is consistent with that commitment.”

READ MORE ON THE FHA CONDOMINIUM POLICY GUIDELINES

FHA-APPROVED CONDOMINIUM APPROVED LOOK-UP

 

EXISTING-HOME SALES SLIP, BUT PRICES STABILIZE

Existing-home sales eased in June as contract cancellations spiked unexpectedly, although prices were up slightly, according to the National Association of REALTORS.

Sales gains in the Midwest and South were offset by declines in the Northeast and West. Single-family home sales were stable while the condo sector weakened.

Total existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, declined 0.8 percent to a seasonally adjusted annual rate of 4.77 million in June from 4.81 million in May, and remain 8.8 percent below the 5.23 million unit level in June 2010, which was the scheduled closing deadline for the home buyer tax credit.

Lawrence Yun, NAR chief economist, said this is an uneven recovery. “Home sales had been trending up without a tax stimulus, but a variety of issues are weighing on the market including an unusual spike in contract cancellations in the past month,” he said. “The underlying reason for elevated cancellations is unclear, but with problems including tight credit and low appraisals, 16 percent of NAR members report a sales contract was cancelled in June, up from 4 percent in May, which stands out in contrast with the pattern over the past year.”

Yun cited other factors in the sales performance. “Pending home sales were down in April but up in May, so we may be seeing some of that mix in closed sales for June. However, economic uncertainty and the federal budget debacle may be causing hesitation among some consumers or lenders.”

The national median existing-home price for all housing types was $184,300 in June, up 0.8 percent from June 2010. Distressed homes – foreclosures and short sales generally sold at deep discounts – accounted for 30 percent of sales in June, compared with 31 percent in May and 32 percent in June 2010.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.51 percent in June, down from 4.64 percent in May; the rate was 4.74 percent in June 2010.

REGIONAL PERFORMANCE

Existing-home sales in the Northeast fell 5.2 percent to an annual pace of 730,000 in June and are 17.0 percent below June 2010. The median price in the Northeast was $261,000, up 3.1 percent from a year ago.

Existing-home sales in the Midwest rose 1.0 percent in June to a pace of 1.04 million but are 14.0 percent below a year ago. The median price in the Midwest was $147,700, down 5.3 percent from June 2010.

In the South, existing-home sales increased 0.5 percent to an annual level of 1.86 million in June but are 5.6 percent belowJune 2010. The median price in the South was $159,100, down 0.1 percent from a year ago.

Existing-home sales in the West declined 1.7 percent to an annual pace of 1.14 million in June and are 2.6 percent below a year ago. The median price in the West was $240,400, up 9.5 percent from June 2010.

GEN Y TO LEAD ‘MASSIVE INCREASE IN HOUSING DEMAND’

Watch out for Generation Y: This large, diverse, well-educated generation will drive the housing market recovery over the next 10 years, according to economists with the University of Southern California Lusk Center for Real Estate.

Gen Y (15-32 year olds) boasts about 77.4 million members, which is about equal in size to the baby boomers (46-64 years old). Yet, Gen Y is much more diverse and educated (60 percent of Gen Y goes to college), according to the center, which recently presented its findings at the USC Lusk Center Orange County Executive Briefing.

Stan Ross, Lusk Center Chairman of the Board, says that “baby boomers and Gen Y comprise 50 percent of the population and will soon be part of the largest U.S. wealth transfer ever.”

As more of this age group joins the work force, “they will produce a massive increase in housing demand,” forecasts the USC’s Lusk Center.

However, Ross points out “these kids are concerned. They have watched the stock market, financial markets, and economy wipe out their parents’ retirement plans. As a result, they will choose lower-risk investment strategies.”

 

“Our greatest battles are that with our own minds” -Jameson Frank

 

REALTORS: 

FREE EXCLUSIVE SPEAKING EVENT ON MONDAY JULY 25, 2011

SPEAKER: Rick Ruby of The CORE Training, Inc.  (Also Zack’s personal coach for the last 2 years)

TOPIC: “How To Turn Buyers Into Closed Transactions And Exceed Your Goals for 2011”

Click on image for more information and to RSVP TODAY (click on REALTORS tab)! (Due To Limited Seating You MUST RSVP)

Zackry Cooper Website

Rick Ruby Website

The CORE Training, Inc. Website

 

 CARBON MONOXIDE DETECTOR LAW EFFECTIVE 7/1/11

Don’t forget that there is a new carbon monoxide detector law in effect. Please be aware, this can be an additional fee to your borrowers should they need a re-inspection on their appraisals if the home does not have these installed.

This law required detectors to be installed in every “dwelling unit headed for human occupancy.” The California legislature also modified both the TDS (for residential one-to-four unit real property) and MHTDS (for manufactured homes and mobilehomes) to include a reference to carbon monoxide detector devices.

Every owner of a “dwelling unit intended for human occupancy” must install an approved carbon monoxide device in each existing dwelling unit having a fossil fuel burning heater or appliance, fireplace, or an attached garage.

The applicable time periods are as follows:

(1) For all existing single-family dwelling units on or before July 1, 2011.

(2) For all other existing dwelling units on or before Jan. 1, 2013.

(Cal. Health & Safety Code § 17926(a).)

This new law requires the owner “to install the devices in a manner consistent with building standards applicable to new construction for the relevant type of occupancy or with the manufacturer’s instructions, if it is technically feasible to do so” (Cal. Health & Safety Code § 17926(b)).

The following language comes packaged with carbon monoxide (CO) detectors:

For minimum security, a CO Alarm should be centrally located outside of each separate sleeping area in the immediate vicinity of the bedrooms. The Alarm should be located at least 6 inches (152mm) from all exterior walls and at least 3 feet (0.9 meters) from supply or return vents.

Building standards applicable to new construction are as follows (overview summary only):

· Section R315 et seq. of the 2010 edition California Residential Code (CRC) [effective Jan. 1, 2011] (applicable to new one-to-two family dwellings and townhouses not more than 3 stories and also where work requiring a permit for alterations, repairs or additions exceeding one thousand dollars in existing dwellings units):

Installed outside of each separate sleeping area in the immediate vicinity of the bedroom(s) in dwelling units and on every level including basements within which fuel-fired appliances are installed and in dwelling units that have attached garages.

· Section 420 et seq of the 2010 edition California Building Code (CBC) [effective Jan. 1, 2011] (applicable to other new dwelling units and also where a permit is required for alterations, repairs or additions exceeding $1,000 in existing dwelling units):

Installed outside of each separate sleeping area in the immediate vicinity of the bedroom(s) in dwelling units and on every level including basements within which fuel-fired appliances are installed and in dwelling units that have attached garages.

A violation is an infraction punishable by a maximum fine of $200 for each offense. However, a property owner must receive a 30-day notice to correct first. If an owner who receives such a notice fails to correct the problem within the 30-day period, then the owner may be assessed the fine. (Cal. Health & Safety Code § 17926(c).)

The only disclosure obligations are satisfied when providing a buyer with the TDS or the MHTDS. If the seller is exempt from giving a TDS, the law doesn’t require any specific disclosures regarding carbon monoxide detector devices. (See Cal. Civ. Code §§ 1102.6, 1102.6d.)

The Homeowners’ Guide to Environmental Hazards also will include information regarding carbon monoxide.

All landlords of dwelling units must install carbon monoxide detectors as indicated in Question 4. The law gives a landlord authority to enter the dwelling unit for the purpose of installing, repairing, testing, and maintaining carbon monoxide devices “pursuant to the authority and requirements of Section 1954 of the Civil Code [entry by landlord].”

The carbon monoxide device must be operable at the time that a tenant takes possession. However, the tenant has the responsibility of notifying the owner or owner’s agent if the tenant becomes aware of an inoperable or deficient carbon monoxide device. The landlord is not in violation of the law for a deficient or inoperable carbon monoxide device if he or she has not received notice of the problem from the tenant.

(Cal. Health & Safety Code § 17926.1.)

 

READ MORE ON THE C.A.R WEBSITE (Login Required To Read Details)

 

MORE HOME OWNERS TURN TO ‘HOMESHARING’

Home owners looking for additional income are opening up their homes and renting out spare bedrooms to offset mortgage costs, which has made “homesharing” the latest trend catch on in some parts of the country, particularly in affluent areas.

Homesharing “started where it was mostly elderly people living on fixed incomes that needed to rent out a room to supplement their income or they were frail and needed help in the house. So they would offer a lower rent to somebody that would help,” says Jackie Grossmann, a homesharing coordinator in Deerfield, Ill. “But now it’s really moved to boomers, who have lost [their] savings.”

While baby boomers are looking for roommates to help offset the costs of home ownership, the roommates are looking for inexpensive housing in “homesharing” arrangements for any number of reasons, such as job loss, divorce, job relocation, and more.

Some programs have even sprung up to help play matchmaker to home owners and renters. In the high-priced area of Deerfield, Ill., for example, the Interfaith Housing Center of the Northern Surburbs offers the North Suburban Homesharing, a free service that matches roommates looking for inexpensive housing with home owners seeking extra cash.

REAL ESTATE SALES SLUMP CONTINUES IN JUNE

After stumbling in April and May, existing-home sales continued to slip in June compared to the month before, according to the latest monthly report from the National Association of Realtors.

Completed sales of existing single-family homes, townhomes, condominiums and co-ops dipped 0.8 percent to a seasonally adjusted annual rate of 4.77 million in June from 4.81 million in May, the report said. Sales fell 8.8 percent compared to June 2010, the scheduled closing deadline for a federal homebuyer tax credit program.

Lawrence Yun, NAR’s chief economist, said in a statement that there was “an unusual spike” in contract cancellations last month.

“The underlying reason for elevated cancellations is unclear, but with problems including tight credit and low appraisals, 16 percent of NAR members report a sales contract was canceled in June, up from 4 percent in May, which stands out in contrast with the pattern over the past year,” Yun said.

The national median price for existing homes rose 0.8 percent year-over-year last month, to $184,300. Distressed properties, typically sold at a discount, made up 30 percent of sales in June, down from 31 percent in May and from 32 percent in June 2010, the report said.

 

“Being challenged in life is inevitable, being defated is optional.”

-Roger Crawford: Motivational author and speaker

 

REALTORS:

FREE EXCLUSIVE SPEAKING EVENT ON MONDAY JULY 25, 2011

SPEAKER: Rick Ruby of The CORE Training, Inc. (Also Zack’s personal coach for the last 2 years)

TOPIC: “How To Turn Buyers Into Closed Transactions And Exceed Your Goals for 2011”

Click on image for more information and to RSVP TODAY **Go To REALTORS Tab**!

(Due To Limited Seating You MUST RSVP)

 

Zackry Cooper Website

Rick Ruby Website

The CORE Training, Inc. Website

 

 CARBON MONOXIDE DETECTOR LAW EFFECTIVE 7/1/11

Don’t forget that there is a new carbon monoxide detector law in effect. Please be aware, this can be an additional fee to your borrowers should they need a re-inspection on their appraisals if the home does not have these installed.

This law required detectors to be installed in every “dwelling unit headed for human occupancy.” The California legislature also modified both the TDS (for residential one-to-four unit real property) and MHTDS (for manufactured homes and mobilehomes) to include a reference to carbon monoxide detector devices.

Every owner of a “dwelling unit intended for human occupancy” must install an approved carbon monoxide device in each existing dwelling unit having a fossil fuel burning heater or appliance, fireplace, or an attached garage.

The applicable time periods are as follows:

(1) For all existing single-family dwelling units on or before July 1, 2011.

(2) For all other existing dwelling units on or before Jan. 1, 2013.

(Cal. Health & Safety Code § 17926(a).)

This new law requires the owner “to install the devices in a manner consistent with building standards applicable to new construction for the relevant type of occupancy or with the manufacturer’s instructions, if it is technically feasible to do so” (Cal. Health & Safety Code § 17926(b)).

The following language comes packaged with carbon monoxide (CO) detectors:

For minimum security, a CO Alarm should be centrally located outside of each separate sleeping area in the immediate vicinity of the bedrooms. The Alarm should be located at least 6 inches (152mm) from all exterior walls and at least 3 feet (0.9 meters) from supply or return vents.

Building standards applicable to new construction are as follows (overview summary only):

· Section R315 et seq. of the 2010 edition California Residential Code (CRC) [effective Jan. 1, 2011] (applicable to new one-to-two family dwellings and townhouses not more than 3 stories and also where work requiring a permit for alterations, repairs or additions exceeding one thousand dollars in existing dwellings units):

Installed outside of each separate sleeping area in the immediate vicinity of the bedroom(s) in dwelling units and on every level including basements within which fuel-fired appliances are installed and in dwelling units that have attached garages.

· Section 420 et seq of the 2010 edition California Building Code (CBC) [effective Jan. 1, 2011] (applicable to other new dwelling units and also where a permit is required for alterations, repairs or additions exceeding $1,000 in existing dwelling units):

Installed outside of each separate sleeping area in the immediate vicinity of the bedroom(s) in dwelling units and on every level including basements within which fuel-fired appliances are installed and in dwelling units that have attached garages.

A violation is an infraction punishable by a maximum fine of $200 for each offense. However, a property owner must receive a 30-day notice to correct first. If an owner who receives such a notice fails to correct the problem within the 30-day period, then the owner may be assessed the fine. (Cal. Health & Safety Code § 17926(c).)

The only disclosure obligations are satisfied when providing a buyer with the TDS or the MHTDS. If the seller is exempt from giving a TDS, the law doesn’t require any specific disclosures regarding carbon monoxide detector devices. (See Cal. Civ. Code §§ 1102.6, 1102.6d.)

The Homeowners’ Guide to Environmental Hazards also will include information regarding carbon monoxide.

All landlords of dwelling units must install carbon monoxide detectors as indicated in Question 4. The law gives a landlord authority to enter the dwelling unit for the purpose of installing, repairing, testing, and maintaining carbon monoxide devices “pursuant to the authority and requirements of Section 1954 of the Civil Code [entry by landlord].”

The carbon monoxide device must be operable at the time that a tenant takes possession. However, the tenant has the responsibility of notifying the owner or owner’s agent if the tenant becomes aware of an inoperable or deficient carbon monoxide device. The landlord is not in violation of the law for a deficient or inoperable carbon monoxide device if he or she has not received notice of the problem from the tenant.

(Cal. Health & Safety Code § 17926.1.)

READ MORE ON THE C.A.R WEBSITE (Login Required To Read Details)

 

FANNIE, FREDDIE MAY LOSE TOP CREDIT RATING

Standard & Poor’s cautioned Fannie Mae and Freddie Mac that they may lose their top credit ratings if lawmakers don’t soon raise the government’s borrowing limit to avoid default.

The S&P also said that the government-sponsored enterprises could potentially default on their debts since they are so reliant on the U.S. government for funding. Fannie and Freddie own or guarantee about half of all U.S. mortgages.

Congress is frantically trying to come up with a solution to raise the $14.3 trillion borrowing limit to avoid a default by an Aug. 2 deadline. If they are unable to come up with a compromise, analysts say it could have a devastating effect on the U.S. economy, particularly the already fragile housing market.

If the government defaulted on its bonds, the government likely would have to raise interest rates dramatically, which in turn would hamper home ownership, analysts say.

 

HELP ON THE WAY FOR UNDERWATER HOME OWNERS?

A bill introduced in the Senate aims to remove barriers for underwater home owners looking to refinance. “The Helping Responsible Homeowners Act” would order Fannie Mae and Freddie Mac to waive fees and remove barriers that are keeping underwater borrowers from refinancing to lower mortgage rates.

The bill, authored by Sen. Barbara Boxer, D-Calif., has gained more momentum in Congress after Sen. Johnny Isakson, R-Ga., who ran one of the nation’s largest real estate brokerages, also signed on to sponsor it.

“The time to help struggling home owners is now while interest rates remain at near-historic lows,” Boxer says. “This legislation would help millions of responsible home owners who are making their payments, but are still struggling to make ends meet. By helping these home owners refinance at lower rates, we will put thousands of dollars back in the pockets of families and strengthen our economy.”

“Whatever you can do, or dream you can, begin it. Boldness has genius, power and magic in it. Begin it now.” -Johann Wolfgang Von Goethe: Was a German poet, playwright, novelist

REALTORS:FREE EXCLUSIVE SPEAKING EVENT ON JULY 25, 2011

SPEAKER: Rick Ruby of The CORE Training, Inc.

(Also Zack’s personal coach for the last 2 years)

TOPIC: “How To Turn Buyers Into Closed Transactions And Exceed Your Goals for 2011”

Click on image for more information and to RSVP TODAY!

(Due To Limited Seating You MUST RSVP)

 

Zackry Cooper Website

Rick Ruby Website

The CORE Training, Inc. Website

CALL TO ACTION FOR BUYERS!!! FHA 2011 LOAN LIMITS

Federal Housing Finance Agency (FHFA) has announced Temporary High Balance Loan Limits, scheduled to expires on December 31, 2010, were extended to September 30, 2011.

This is not dictated by case number order date! You will need to have all FHA loans with current high balance loan limits FUNDED BY AUGUST 15th, 2011 to ensure enough time to get the loan insured. RPM will have additional resources dedicated to the loans that are impacted and make them a priority in insuring. We will relay any additional information provided to us.

For mortgage loans originated after September 30, 2011, revised limits will apply. The maximum limit is $625,000 for a 1-unit property in the continental United States, established under the Housing and Economic Recovery Act, and referred to by Fannie Mae as “permanent.”

Informational Material Links Below:

Loan Limits Expiration FAQs

Confirmation of Conventional Loan Limits for 2011

FHA Maximum Conforming Loan Limits

Potential to FHA Single-Family Loan Limits beginning October 1, 2011

SELLING YOUR HOUSE? WAITING MAY NOT MAKE SENSE

There have been some bright spots in the residential real estate market over the last couple of months. Several price indices have reported a stabilization of prices and some regions have even shown small levels of appreciation. This has led some to believe that we may have reached a bottom for home values. We must realize that what we are actually experiencing is a ‘window of opportunity’ as the banks are delayed in bringing certain inventories of distressed properties to the market. Let’s look at what others are reporting:

Bloomberg Businessweek:

“The crux of Simon’s analysis is that the loose lending practices seen during the housing bubble allowed 5 million renters to become homeowners, and that the market is in the protracted process of evicting this group. He believes housing prices will decline 6 percent to 8 percent nationally, with 6 million to 7 million more foreclosures yet to come.”

Yahoo Finance:

“The problem with the real estate market remains excess inventory. Based on Shilling’s research, there are 2 million to 2.5 million excess homes in the country – a supply that will take 4-5 years to work-off. The result: Housing prices will fall another 20% and underwater mortgages will balloon from 23% to 40%, he says.”

Housing Wire:

“Both warmer weather and the drop in distressed sales percentage have contributed to recent home price improvements. However, given the disappointing pace in housing demand recovery, both factors may turn against us in the coming winter and push home prices lower again…

This supply-demand imbalance affirmed JPMorgan analysts’ estimate of a further 4% drop in home prices from the first quarter of 2011 to a new bottom next year.”

DS News:

“Home prices have gotten a little bit of a boost in recent months thanks to a seasonal uptick in market activity. Most analysts, however, expect further declines to characterize the later part of the year and possibly extend into next year, largely because of the huge supply of foreclosures on the market.”

Bottom Line

If you are thinking of selling in the next twelve months, you would probably do much better if you sold your house sooner rather than later.

WHY DO PEOPLE ACTUALLY BUY A HOME?

It seems that every time we talk about real estate today the conversation immediately goes to the financial aspects of buying a home. Where are prices headed? Where are interest rates headed? Should I wait to try and get a ‘better buy’? Should I wait until I can get a ‘steal’?

The odd thing about all these questions is that survey after survey keeps telling us that price is not the reason families actually buy a home. When money is considered at all, it is in light of not paying rent to a landlord. Let’s look at two recent surveys as examples:

National Housing Survey

The top five reasons given in the survey for buying a home, in order, are:

• It means having a good place to raise children and provide them with a good education
• You have a physical structure where you and your family feel safe
• It allows you to have more space for your family
• It gives you control of what you do with your living space (renovations and updates)
• Paying rent is not a good investment

The Myers Research and Strategic Services Survey

The top five reasons given in the survey for buying a home, in order, are:

• Home ownership provides a stable and safe environment for children and other family members
• Home ownership means the money you spend on housing goes towards building equity, rather than to a landlord
• Home ownership creates the opportunity to pay off a mortgage and own your home by the time you retire
• Home ownership creates the opportunity to live in a neighborhood that you enjoy
• Home ownership allows you the right to decorate, modify and renovate your home as you see fit

Bottom Line

Price dominates conversation when we talk about buying a home. However, when it comes down to it, we actually buy for the same reasons our parents and grandparents did – we want a better lifestyle for ourselves and our families.

CALL TO ACTION FOR BUYERS!!! 

FHA 2011 LOAN LIMITS

 

Federal Housing Finance Agency (FHFA) has announced Temporary High Balance Loan Limits, scheduled to expires on December 31, 2010, were extended to September 30, 2011.

This is not dictated by case number order date! You will need to have all FHA loans with current high balance loan limits FUNDED BY AUGUST 15th, 2011 to ensure enough time to get the loan insured. RPM will have additional resources dedicated to the loans that are impacted and make them a priority in insuring. We will relay any additional information provided to us.

For mortgage loans originated after September 30, 2011, revised limits will apply. The maximum limit is $625,000 for a 1-unit property in the continental United States, established under the Housing and Economic Recovery Act, and referred to by Fannie Mae as “permanent.”

Informational Material Links Below:

Loan Limits Expiration FAQs

Confirmation of Conventional Loan Limits for 2011

FHA Maximum Conforming Loan Limits

Potential to FHA Single-Family Loan Limits beginning October 1, 2011

 

“As we increasingly master our perceptions, beliefs, and thought/feeling patterns, we magnetically attract that which we most desire.” 

-Luanne Oakes: Was a holistic doctor, author and composer

 

 

NEWS HEADLINES & MORE

A report in the Wall Street Journal said two Representatives plan to introduce legislation to merge Freddie & Fannie and restructure the company into a government-held corporation. Most doubt that anything will happen until after the 2012 elections. It is one idea out of many competing plans for housing finance, and there is certainly no consensus on whether or not the government should offer a guarantee. But the plan has some genetics that we may see in future proposals. “Frannie” would be a utility-like entity and phase out government-controlled Fannie Mae and Freddie Mac, would purchase mortgages and repackage them as government-backed securities, and have no shareholder investors.

Fannie Mae released news for servicers. Specifically, it addressed HUD’s Emergency Homeowners’ Loan Program (the EHLP is designed to provide mortgage payment relief to eligible borrowers experiencing a reduction in income resulting from involuntary unemployment or underemployment due to adverse economic conditions or a medical emergency.) For details go to FannieEHLP.

This morning we start off with the 10-yr note yield at 2.90% after closing around 2.92% Monday. MBS prices improved by roughly .250 on current coupon products. Rates are being helped by uncertainty over the European debt crisis, what the US will do with its debt ceiling (does it really matter, and isn’t this debt ceiling jabbering taking our eyes off the real problem – the debt?), when Congress will get down to the business of really cutting the budget and what will be cut, and how we will grow our economy moving forward. Most believe that eventually rates will go up because of inflation, or in order to attract investment dollars, but for now we have the “flight to safety” bid.

Today starts yet another Treasury auction with $32 billion 3yrs, $21 billion 10yrs, and $13 billion 30yrs. We’ve already had the International Trade numbers for May – usually not a big market mover, and the deficit went up to $50.2 billion – and later we’ll see the minutes from the last FOMC meeting at 2PM EST. The yield on the 10-yr is down to 2.90% and MBS prices are a shade better.

 

THE DEVIL IS IN THE DETAILS

 

DISTRESSED PROPERTY INFOGRAPHIC

Info on Shadow Information: CoreLogic

Info on inventory/sales ratio: LPS

Info on discounts on short sales and foreclosures: RealtyTrac

 

SOME HOAs FORCLOSING ON RESIDENTS

While banks are usually the ones who go after delinquent home owners, more homeowners’ associations (HOAs) around the country are deciding to take on that power too in fighting against home owners who have stopped paying their HOA fees.

For communities governed by a homeowners’ association, which one in five communities are, more HOAs are discovering they have a power they have ever rarely acted upon until now – the right to foreclose on residents who stop paying fees.

For example, a condo complex in Fort Pierce, Fla., for 55-and-older residents was once a desirable area with condos once fetching nearly $80,000 four years ago but now sell for as little as $3,000. The HOA levied $6,000 assessments on its residents for much-needed repairs in the complex and when some residents didn’t pay, the HOA foreclosed on them, even if they didn’t owe the bank anything.

“The treacherous part is that homeowners’ associations are acting like a local government without restraints, and they have this extraordinary power,” Marjorie Murray, a lawyer and founder of the Center for California Homeowner Association Law, told the Associated Press.

If HOAs need to do major repairs, the board can levy a “special assessment” on top of its regular dues. When a home owner fails to pay, all of the home owners then have to step up to pick the costs.

“What many people didn’t realize when they bought their homes was that the fine print gave the association the right to foreclose – even over a few hundred dollars in unpaid dues,” according to an article by the Associated Press. “All the association board has to do is alert its attorney to place a lien on the property to start the process. The home can then be auctioned by the board until the bank eventually takes ownership. Home owners typically have no right to a hearing.”

About 65 percent of HOAs have reported delinquency rates higher than 5 percent, according to a September survey by the Community Association Institute.

 

10 BEST-PERFORMING MAJOR HOUSING MARKETS

Ten of the highest performing major market metros are expected to improve their performance over the first half of the year, with five of the top 10 even expected to see modest gains, reports Clear Capital in its latest monthly Home Data Index.

While housing prices in the first half of the year were mostly negative among the metro areas, Clear Capital says the market is showing signs of stabilizing.

Top Performers

The following are the highest performing major markets based on first half 2011 data (January through June) and second half forecast, according to Clear Capital.

1. Washington, D.C.-Arlington, Va.

2. New York-Long Island, N.Y.-No. New Jersey, N.J.

3. Orlando

4. Dallas-Fort Worth-Arlington, Texas

5. San Francisco-Oakland-Fremont, Calif.

6. Boston-Cambridge-Quincy, Mass.

7. Honolulu

8. San Diego-Carlsbad-San Marcos, Calif.

9. Rochester, N.Y.

10. Memphis, Tenn.

Yet, only five of these markets are expected to boast home price gains in the second half of 2011: Washington, D.C., New York, Orlando, Dallas, and San Francisco, according to Clear Capital.

Worst-Performing Markets

Meanwhile, the lowest performing markets were Virginia Beach-Norfolk-Newport News, Va.; Cleveland-Elyria-Mentor, Ohio; and Minneapolis-St. Paul-Bloomington, Minn., according to Clear Capital.

“While most individual markets are also projected to post losses for the year, it is clear prices have begun to level off and are not exhibiting as much volatility as we’ve seen since the downturn began,” says Alex Villacorta, director of research and analytics at Clear Capital.

 

“As a man grows older it is harder and harder to frighten him.” -Jean Paul Richter

DO YOU NEED AN OPEN HOUSE FLYER?

Coming into the weekend, we’d like to create an open house flyer for you. Simply send an email to my assistant Sherrell at sayers@rpm-mtg.com. Provide your property address and list price and we’ll create an open house flyer for you. Please provide this request before 4:00 pm today. See an example below.

 

 

 

7 OUT OF 10 RENTERS SAY OWNING A HOME IS A TOP PRIORITY

Most Americans still believe that owning a home is a solid financial decision, and a majority of renters aspire to home ownership as a long-term goal. According to the 2011 National Housing Pulse Survey released today by the National Association of REALTORS®, 72 percent of renters surveyed said owning a home is a top priority for their future, up from 63 percent in 2010.

Seven in 10 Americans also agreed that buying a home is a good financial decision while almost two-thirds said now is a good time to purchase a home. The annual survey, which measures how affordable housing issues affect consumers, also found that more than three quarters of renters (77 percent) said they would be less likely to buy a home if they were required to put down a 20 percent down payment on the home, and a strong majority (71 percent) believe a 20 percent down payment requirement could have a negative impact on the housing market.

“Despite the economic setbacks Americans have experienced in today’s current climate, it is clear that a strong majority still believe in home ownership and aspire to own a home,” said NAR President Ron Phipps. “However, achieving the dream of home ownership will become increasingly difficult for buyers if they are required to make a 20 percent down payment, which may be a reality for many of tomorrow’s buyers if a proposed

Qualified Residential Mortgage rule is adopted. That is why REALTORS® are strongly urging regulators to go back to the drawing board on the proposed rule.”

Defining the QRM rule is important because it will determine the types of mortgages that will generally be available to borrowers in the future. As currently proposed, borrowers with less than 20 percent down will have to choose between higher fees and rates today – up to 3 percentage points more – or a delay of between nine and 14 years while they save up the necessary down payment.

More than half – 51 percent – of self-described “working class” home owners as well as younger non-college graduates (51 percent), African Americans (57 percent), and Hispanic Americans (50 percent) who currently own their homes reported that a 20 percent down payment would have prevented them from becoming home owners.

Pulse surveys for the past eight years have consistently reported that having enough money for a down payment and closing costs are top obstacles that make housing unaffordable for Americans. Eighty-two percent of respondents cited these as the top obstacle, followed by having confidence in one’s job security.

The survey also found respondents were adamantly against eliminating the mortgage interest deduction (MID). Two-thirds of Americans oppose eliminating the tax benefit, while 73 percent believe eliminating the MID will have a negative impact on the housing market as well as the overall economy.

“The MID facilitates home ownership by reducing the carrying costs of owning a home, and it makes a real difference to hard-working American families,” Phipps said. “Home ownership offers not only social benefits, but also long-term value for families, communities and the nation’s economy. We need to make sure that any changes to current programs or incentives don’t jeopardize our collective futures.”

When asked why home ownership matters to them, respondents cited stability and safety as the top reason. Long-term economic reasons such as building equity followed closely behind. On a local level, respondents said neighbors falling behind on their mortgages and the drop in home values were top concerns. Foreclosures also continue to remain a large concern, with almost half of those surveyed citing the issue as a problem in their area.

 

LATEST BILL CALLS FOR FANNIE, FREDDIE MERGER

A bill is expected to be introduced today in the House of Representatives that calls for a merger between government-sponsored enterprises Fannie Mae and Freddie Mac, The Wall Street Journal reports.

Rep. Gary Miller, R-Calif., who is introducing the bill and who is also a real estate developer and former home builder, proposes that the newly merged firm also be restructured in how it operates. It would purchase mortgages and sell them to investors as securities that are backed by the government.

Unlike other bills that have called for winding down of the GSEs and privatizing them, Miller’s bill would not seek private owners for the new entity. However, the new firm would be privately capitalized.

Banks would pay a ‘guarantee’ fee on loans that would fund the firm’s operations and maintain adequate capital. Investors would pay an additional fee to finance an insurance fund that would cover catastrophic losses,” The Wall Street Journal explains.

The new firm would be regulated by the Federal Housing Finance Agency. The FHFA would ensure the firm’s market share never exceeds 50 percent of the mortgage market.

Lawmakers continue to wrestle over the fate of the GSEs, which have cost taxpayers $138 billion since the government took them over in 2008. Earlier this year, the White House called for winding them down. A series of bills currently in Congress are attempting to shrink Fannie and Freddie’s role and privatize them.

Miller’s bill is expected to garner bipartisan support.

 

10 STEPS TO A SAFE OPEN HOUSE

In February, a real estate agent in Ottumwa, Iowa was assaulted and tied up when she arrived at a home for a scheduled showing appointment. Her attackers robbed the home, according to news reports. In response to the attacks, the Iowa Association of Realtors invited safety instructor Andrew Wooten to conduct safety seminars throughout the state earlier this month.

Wooten is a certified crime prevention practitioner and president of workplace safety firm Safety Awareness Firearms Education (SAFE). He has worked with real estate professionals for 25 years and has partnered with the National Association of Realtors as a safety trainer.

These tips are presented in a safety video offered in a Realtor Safety section of the Realtor.org website:

1. Park where you cannot get blocked in. Agents are most afraid when they are walking back to their car after an open house, Wooten said. Therefore, take a few minutes to make sure you have a clear line of sight to your vehicle.

“Before you exit your car, look around. Can you see the front door? Are there trees or shrubbery within 10 feet that can serve as a hiding place? When getting out of the car, keep looking around. When you get to the front door, turn around and walk back — are there places where someone could surprise you?” Wooten said.

2. Meet the neighbors. There’s safety in numbers. Introduce yourself, point out your car, and invite the neighbors over to the open house.

“Meeting the neighbors will drive people to the home and is a great source of referrals,” Wooten said.

3. Advise clients about valuables. Thefts often result in lawsuits against agents, Wooten said. To forestall this, develop a list of valuables clients should put away before an open house, including mail, jewelry, prescription drugs, extra sets of keys, and financial statements, among others.

Then, because clients likely “won’t listen” otherwise, get to the property an hour before the open house is scheduled to start and do a walk-through with the clients to point out what they need to secure, Wooten said.

4. Be aware and work in teams. The No. 1 place where agents are attacked during an open house is the front door, partly because lockboxes take time to open, Wooten said. If you are alone, turn your back against a wall to avoid being attacked from behind.

Company is better, however. Sign up your affiliates, such as a home inspector or title officer, to sit the open house with you.

“Not only will they jump at the opportunity, they will bring goodies and giveaways,” Wooten said.

5. Establish your escape routes. Walk around the house and notice how to get in and out of rooms. If there is a fence in the backyard with a gate, unlock the gate for easy exit. As another escape route, open the garage door but lock the door leading to the inside from the garage. Direct clients to the front door with signs.

6. Set up for safety. Hang decorative bells behind every outside door that you have unlocked. These will alert you whenever someone enters the house. Do not bring your laptop to an open house. Not only can it be easily stolen, but signing on to someone’s unsecured wireless network can open you up to identity theft.

Carry only what you need — purses go in the trunk of your car before you leave your house, not when you arrive at the open house. Finally, when picking a room to wait in during the open house, pick the one with the most cell service and with escape routes.

7. Check out your guests as they arrive. As soon as someone comes in, jump up, introduce yourself, and direct guests to a sign-in sheet.

“This is your time to do a ‘checkup from the neck up,’ ” Wooten said.

“Ask yourself, ‘Is this someone I’m comfortable with? Do I want to be alone with this person?’ If not, enlist your support team. Make sure there are others around you as you work with this person.”

8. Never, ever turn your back on a prospect. Let prospects walk in front of you. If a man says, “Ladies first,” to a female agent, the agent should say something like, “You are such a gentleman, thank you. But I really want you to see this home, and if I can direct you where to go, I think you’ll gain a further appreciation for this home.”

Both men and women can be violent, so this advice applies regardless of the visitor’s gender, Wooten said.

9. Never go into certain rooms. When showing visitors around, never go into rooms with no escape routes. These include walk-in closets, bathrooms and laundry rooms, among others. Instead, direct visitors to those rooms.

10. Close up in teams. Openings and closings are the most dangerous times during an open house, Wooten said. Often, there is another agent down the street also doing an open house. If you’re alone, lock up your house, go over to the other agent, and offer to walk through his or her house and close it up with him or her and then both of you can go over to your house to do the same.

Working in teams applies to both men and women, Wooten said.

Wooten said that inmates who have attacked agents have said, “Regardless if they’re male or female, if there’s one agent in the open house working (alone) I know I’ve got (that agent). But if there are two or more, I’m out of there.”

Crimes happen to men as much as they happen to women, Wooten said, though there are some differences. Women are more often stalked than men are, and stalkers tend to get violent at the intended victim’s home. Therefore, Wooten advises agents to heed his “three L’s for home safety”: locks, lighting and landscaping.

1. Locks: Install anti-bumping deadbolt locks on all doors. (Lock bumping is a lock-picking technique.)

2. Lighting: Install motion-detector lighting outside all four sides of the home, and install timers for interior lights so that the home appears occupied even when it is not.

3. Landscaping: To prevent criminals from using them as hiding places, trim shrubs to a maximum height of 3 feet and cut trees so they hang no lower than 10 feet from the ground.

 

WHICH BANKS ARE PURSUING THE MOST SHORT SALES?

JPMorgan Chase and Wells Fargo accounted for 60 percent of the some 17,781 short sale and deed-in-lieu agreements loan servicers completed through May under the Home Affordable Foreclosure Alternatives program, reports Inman News in its analysis of the latest figures provided by the Treasury Department.

The two banks emerged as the front-runners in completing short sales and deed-in-lieu of foreclosure agreements when compared up against other loan servicers, all participating in the HAFA program.

On the other hand, Bank of America entered into less than half as many HAFA short sales or deed-in-lieu of foreclosure agreements than either JPMorgan Chase or Wells Fargo.

The government’s HAFA program provides incentives for completing short sales. For example, home owners participating in a HAFA short sale receive $3,000 in relocation assistance.

“The loudest and most influential voice you hear is your own inner voice, your self critic. It can work for you or against you, depending on the messages you allow.” -Keith Harrell: Was a motivational speaker, trainer, and coach

5 REAL ESTATE HEADLINES YOU’LL SEE IN THE NEXT SIX MONTHS

Making predictions can be the ‘kiss-of-death’ for a blog. Even if we get four out of five correct (80%), there are those in the industry who will kill us on the one we got wrong. We believe strongly that when making a real estate decision for you and your family you must look forward and take into consideration how the housing market may change.

For this reason, we are willing to take on the possible wrath of our counterparts by sticking out our necks and predicting these will be the major real estate news stories from now until the end of the year.

Interest Rates Rise

Many, including us, have been surprised that rates have not risen already. However, the next several months are going to see three distinct changes that will propel rates upward.

1. As the government starts to leave the mortgage market, private industry will step in. Private industry demands a higher rate of return on their investments. Mortgages will be no different. Studies have shown that 30 year mortgage rates could increase by 1 to 3% over the current rate.
2. In many higher priced markets, rolling back Conforming Loan Limits means that rates for the mortgages on these properties will resort back to the rates on private jumbo loans. The FHFA informed us that last year, the difference between mortgage rates for jumbo loans and jumbo-conforming mortgages has varied between about ½ and ¾ of a percentage point.
3. As the economy gets better (and we believe it will), the pressure to keep rates low to stimulate growth will abate.

Some Loan Requirements Tighten but More Can Now Get a Loan

Lending institutions have already started to introduce stricter mortgage guidelines. Whether the Quality Residential Mortgage (QRM) requirements are instituted as originally proposed or eased somewhat, there is no doubt that guidelines will continue to tighten as we work through the year. However, we believe the private sector will again start introducing alternative mortgage financing but at a greater expense to the consumer. You WILL be able to get a mortgage. It will just cost you more.

Housing Sales Increase

Contracted sales have shown consistent improvement over the last six months and we feel this will continue and actually begin gaining even greater momentum. We believe there is a ‘pent-up’ buying demand caused by the volatility of the market over the last several years. When interest rates start to move upward and alternative financing becomes more available, these buyers will start to jump off the fence. We believe there will be a major upswing in sales over the next six months.

Distressed Properties Increase Markedly

More people are paying their mortgage on time and that is great news for housing in the long term. However, the numbers of distressed properties currently in the foreclosure process is still very swollen. These properties will begin coming to the market in the second half of the year as short sales and foreclosures. The numbers will be staggering in some areas.

Prices Continue to Soften in Most Markets

The current housing inventory for sale and the distressed properties about to come on the market will vastly outnumber the increased supply of purchasers we will see over the next six months. There will be more houses for sale then there will be buyers purchasing them. That oversupply will continue to put downward pressure on prices through the rest of this year and into 2012.

 

DOWN PAYMENT PLAN MAY PRICE BUYERS OUT OF MARKET

How much a home buyer should have a for a down payment on a home has been up for dispute among policymakers. Some recent federal regulators and lawmakers calling for a 20 percent or 10 percent down payment in order for mortgages to be considered a “qualified residential mortgage” and not subjected to extra fees.

However, such stringent down payment requirements could price many home owners out of the housing market, argues a growing number of consumer housing advocates. (Read more about the National Association of REALTORS®’ stance).

In fact, for many creditworthy home buyers in occupations that don’t boast high median salaries, they might have to wait a decade or even longer to meet the down payment rule.

The Center for Responsible Lending, which has argued that 10 percent or 20 percent down payment requirements are too high, has a chart on its Web site boasting the length of time it would take borrowers of different occupations to save enough for a 10 percent down payment on a 2010 median-priced $172,900 home.

▪U.S. Army Staff Sergeant: 16 years (median salary: $30,176)

▪Public school teacher: Nearly 15 years (median salary: $33,530)

▪Firefighter: 10 years (median salary: $47,730)

▪Police officer: Nearly 9 years (median salary: $55,620)

“We’re not advocating for zero percent down,” Kathleen Day, spokesperson for the Center for Responsible Lending, told The New York Times. “We think down payments are good. But we think the market should set them, based on the underwriting.” (That is, based on the borrower’s credit history and income and debt levels.)

The down payment proposal comes as part of new rules for mortgage lenders in the Dodd-Frank law. Federal agencies are trying to set criteria for what should be considered a reasonably safe mortgage or QRM. Lenders issuing a QRM will be able to sell the loan to an investor and avoid retaining any of the risk. However, lenders will consider non-QRMs more risky since they’ll have to retain a 5 percent ownership. (Loans insured by the Federal Housing Agency would be exempt.) For borrowers who are unable to meet QRM, they would have to pay more for their loans because lenders would have to boost interest rates on their loans to cover the extra costs.

What You Can Do

Lawmakers have extended the public comment on the new down payment rules to Aug. 1. The REALTOR® Action Center has issued a call for real estate professionals to help ensure their clients have access to affordable mortgages. To send a letter to your state lawmakers, visit REALTOR.org

 

NATIONAL RENTAL PRICES CLIMB IN JUNE

Rental listing prices nationwide rose 6.7 percent year-over-year in June, according to a report from real estate search site HotPads.

The report was based on the median listing prices of 500,000 rentals on HotPads.com across major U.S. metro areas between June 2010 and June 2011.

When broken down by number of bedrooms, the data showed studios and five-bedroom homes experienced the biggest rental price hikes. Monthly rent prices for studios rose 14.3 percent, to a median $833. For five-bedroom homes, rents rose 12.1 percent to a median $2,727.

“This is a telling trend (that) may indicate a growing demand for rental housing among first-time renters and larger families,” the report said.

Monthly rents for one-bedroom homes rose a more modest 2.3 percent to a median $851. Rents for two-bedroom homes rose 2 percent to $1,020; for three-bedroom homes, up 4.2 percent to $1,295; and for four-bedroom homes, up 5.3 percent to $1,832.

As in a previous report, HotPads said “built-up demand for low-risk housing may be due to financial uncertainty and a growing national sentiment questioning the future value of a home purchase.”

CAN A NEW HUD PROGRAM SAVE HOME OWNERS?

In June, the Department of Housing and Urban Development launched a new grant program to help home owners who have fallen behind on their mortgage payments due to unemployment or unexpected medical bills.

The program offers eligible home owners $50,000 in interest-free loans for up to two years.

HUD has until the end of the government’s fiscal year, Sept. 30, to spend all of its $1 billion for the Emergency Homeowners’ Loan Program (or EHLP), which will provide 27 states with aid for the program. Home owners in eligible states have until July 22 to complete their applications.

HUD hopes that 30,000 home owners can be helped through the program.

However, while some are seeing the program as a last chance to help unemployed home owners stay in their homes, others aren’t as convinced the program will do much good in ultimately lessening foreclosures in the country.

“The best foreclosure mitigation program in America is a job,” argues Rep. Jeb Hensarling, R-Texas. “It’s not a government check, it’s a paycheck.” Earlier this year, Hensarling sponsored a bill to end EHLP, which was supported by the House. The Senate has yet to take up the bill, however.

For a full list of states and eligibility requirements for EHLP, visit the HUD Web site.