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Archive for July, 2011

Fewer Home Owners Report Equity in Homes

Friday, July 22nd, 2011

DAILY REAL ESTATE NEWS | FRIDAY, JULY 22, 2011

With falling property values, more home owners are reporting being underwater, owing more on their home than it’s currently worth.

One in three home owners — or 33 percent — say that their home is worth less than the amount they still owe on their mortgage, while another 18 percent aren’t even sure if they’re underwater, according to the latest Rasmussen Report of 676 home owners.

Upper-income home owners tend to be more confident about their home’s value than those who earn less, according to the study. Also, investors were found to be more confident than noninvestors about their home’s equity.

Overall, for the second straight month, less than half of home owners — 49 percent — say the value of their home is worth more than the amount they still owe on their mortgage. While that’s up from June’s all-time low of 45 percent, analysts are still concerned.

For comparison, in December 2008, 61 percent of home owners surveyed said they believed their home was worth more than their mortgage. While that number has fallen since, this is the first time the number of home owners believing they had equity in their home stayed below 50 percent for two months in a row.

Source: “Just 49% Say Home Is Worth More Than Mortgage,” Rasmussen Reports (July 21, 2011)

Some MARS Stipulations No Longer Enforced

Tuesday, July 19th, 2011

By: Kristie Franks

The Federal Trade Commission will no longer enforce most provisions set forth in the Mortgage Assistance Relief Services (MARS) Rule, according to a statement released Friday.

The MARS Rule required real estate agents to make several disclosures when assisting distressed homeowners in obtaining short sales from their lenders or servicers.

The rule also banned advance fee collection and prohibited false or misleading statements.

After the Rule was enacted by Congress in 2009, several real estate agents complained that the disclosures often confused homeowners or misled them.

“As more and more American homeowners seek short sales, it is especially important that the Rule not inadvertently discourage real estate professionals from helping consumers with these types of transactions,” the FTC stated.

The MARS Rule required real estate agents to state that they are not associated with the government, nor have their services been approved by the government or the homeowner’s lender; the lender may choose not to alter the homeowner’s loan; and if a company tells a homeowner to stop making mortgage payments, they must warn them that they could lose their home or damage their credit rating.

Real estate agents who are in good standing under state licensing requirements, in compliance with state real estate laws, and assisting homeowners in obtaining short sales are no longer required to provide the MARS disclosures.

These agents may also collect advance fees.

Deceptive practices and false statements will still be prohibited by the FTC.

The FTC’s stay only applies to short sales and does not affect agents providing assistance with other types of relief such as loan modifications.

Forecast: 15 top-performing real estate markets for remainder of 2011

Friday, July 8th, 2011

Despite Q2 uptick, overall home prices expected to dip further by year’s end

BY INMAN NEWS, FRIDAY, JULY 8, 2011.

U.S. home prices rose slightly in the second quarter, but ultimately fell in the first half of the year and are likely to fall further in the second half, according to a report from data and valuation firm Clear Capital, released today.

The firm’s Home Data Index fell 3.2 percent between fourth-quarter 2010 and second-quarter 2011, despite a 0.9 percent increase in the second quarter from the first quarter. Prices are expected to fall another 2.4 percent by year-end. Since June 2010, home prices have fallen 8 percent overall, the report said.

Clear Capital attributed the price declines to downward pressure from high unemployment and a high share of foreclosure sales. Bank-owned properties (REOs) accounted for 31.4 percent of overall sales at the end of the second quarter, a slight dip from 33.1 percent at the end of the first quarter.

“While varying according to each local market, it is unlikely national home prices have reached a true and sustainable bottom,” the report said.

Nonetheless, “it is clear prices have begun to level off and are not exhibiting as much volatility as we’ve seen since the downturn began,” said Alex Villacorta, director of research and analytics at Clear Capital, in a statement.

The Midwest and the West are expected to see the biggest price drops in the second half of the year: 4.1 percent and 4 percent, respectively. The Northeast and the South will stay relatively flat with declines of 0.8 percent and 1.3 percent, respectively.

Of 50 major metro areas, only five are forecast to see home-price gains in the second half of the year: Washington, D.C.; New York; Orlando; Dallas; and San Francisco. Among the 15 markets expected to perform best in the second half of the year, 11 are expected

to see either gains or smaller rates of decline.

The Virginia Beach-Norfolk-Newport News, Va., metro area is expected to see the biggest price drop, down 8.6 percent, among the 15 lowest-performing major markets. Clear Capital predicts nine out of the 15 will either maintain or slow their price declines compared to the first half of 2011.