What happened in August in the Southern Utah Real Estate Market!

August has come and gone, so let’s take a look at what happened in the Greater St. George area and Hurricane Valley in the month of August

Before we get started I would also like to thank the following for their closed transactions in August:

1. Rick and Tatine Jenkins (sold listing)
2. Rebekah Andrus (sold listing)
3. Kevin and Nichole Cowley (sold listing)

Rick and Tatine Jenkins are third time customers and I want to thank them for their loyalty.

I am curious if this is information is interesting and or helpful to you. I am going to do a contest, and I will post the results later this month or next month. If you read this blog email me at joe@joelangston.com and put “contest” in the subject line. The winner gets some free movie tickets.

If you know of anyone else that might benefit from this information with their permission of course, please send me an email with the subject line “referral” to joe@joelangston.com with their name and email address, and I will put them on the list. Whoever provides the most referrals gets movie tickets too.

One more thought. Take a look at the business blog section of this site. Dr. Dick Harper is a personal friend and mentor of mine, and he is brilliant. Take a look at his blog, Dr. Dick’s Journey. He has provided a lot of the information I have used on this blog of late, and you will be well rewarded by taking a look at his posts. No, I am not a weirdo; Dixie Zumba Girls is my wife’s blog. She and a couple of her friends teach a dance exercise class called Zumba. If you know anyone interested in that, she has classes at several different locations, and she usually high-lights a routine on her blog.

I must remind you these stats are according to the Washington County Board of Realtors MLS and do not take into account any private sells. As many of you know, Utah is a non-disclosure state, (That means the county does not record prices of sold homes, only the MLS system does) so if I try to start introducing private sell data, I will struggle with completeness and accurate. So, for the time being, I will stick only to data from the Washington County Board of Realtors MLS.

This data covers the Greater St. George area: (St. George, Santa Clara, Washington, Ivins) and the Hurricane Valley: (Hurricane, La Verkin, Toquerville). For the purpose of this blog, homes refer to single family houses, condos, town homes and new construction. I have not included any provisions for time shares, trailers, mobile or manufactured homes. That being said, this is what happened in August. You can see the July comparison in parenthesis.

Total Market Activity on homes in August

Active Listings: 2,385 (July 2,465)
New Listings: 440 (July 524) significant dip
Sold Listings: 149 (July 150)
Months of Inventory: 16.01 (July 16.43)

Homes priced up to $150,000

Active Listings: 182 (July 208)
New Listings: 34 (July 35)
Sold Listings: 18 (July 23)
Months of Inventory: 10.11 (July 9.04)

Homes priced from $150,001 to $200,000

Active Listings: 333 (July 334)
New Listings: 87 (July 69)
Sold Listings: 25 (July 28)
Months of Inventory: 13.32 (July 11.93)

Homes priced from $200,001 to $250,000

Active Listings: 382 (July 406)
New Listings: 106 (July 83)
Sold Listings: 35 (July 34)
Months of Inventory: 10.91 (July 11.94)

Homes priced from $250,001 to $300,000

Active Listings: 350 (July 366)
New Listings: 49 (July 97) wow, big dip
Sold Listings: 29 (July 22)
Months of Inventory: 12.07 (July 16.64)

Homes priced from $300,001 to $350,000

Active Listings: 239 (July 243)
New Listings: 31 (July 73) significant dip, thank heaven
Sold Listings: 18 (July 14)
Months of Inventory: 13.28 (July 17.36)

Homes priced from $350,001 to $400,000

Active Listings: 183 (July 184)
New Listings: 36 (July 39)
Sold Listings: 8 (July 11)
Months of Inventory: 22.88 (July 16.73)

Homes priced from $400,001 to $450,000

Active Listings: 108 (July 108)
New Listings: 21 (July 27)
Sold Listings: 3 (July 5)
Months of Inventory: 36.00 (July 21.60)

Homes priced from $450,001 to $500,000

Active Listings: 127 (July 135)
New Listings: 8 (July 21)
Sold Listings: 1 (July 4)
Months of Inventory: 127.00 (July 33.75) Yikes! Get a load at this absorption.

Homes priced from $500,001 to $550,000

Active Listings: 70 (July 71)
New Listings: 8 (July 15)
Sold Listings: 0 (July 1)
Months of Inventory: No Sales in August (July 71.00) Yea, that means it worse than 71.

Homes priced from $550,001 to $600,000

Active Listings: 76 (July 74)
New Listings: 12 (July 17)
Sold Listings: 2 (July 2)
Months of Inventory: 38.00 (July 37.00)

Homes priced from $600,001 to $650,000

Active Listings: 33 (July 39)
New Listings: 5 (July 7)
Sold Listings: 2 (July 1)
Months of Inventory: 16.50 (July 39.00) Looky here, Progress!

Homes priced from $650,001 to $700,000

Active Listings: 49 (July 47)
New Listings: 7 (July 13)
Sold Listings: 3 (July 0)
Months of Inventory: 16.33 (No Sales in July) Here too!

Homes priced from $700,001 to $750,000

Active Listings: 21 (July 20)
New Listings: 7 (July 4)
Sold Listings: 0 (July 0)
Months of Inventory: No Sales in August (No Sales in July) No wonder that listing hasn’t sold!

Homes priced from $750,001 to $800,000

Active Listings: 31(July 28)
New Listings: 5 (July 2)
Sold Listings: 0 (July 1)
Months of Inventory: No Sales in August (28.00 July)

Homes priced from $800,001 and up

Active Listings: 201 (July 202)
New Listings: 24 (July 22)
Sold Listings: 5 (July 4) Wow! Some sales!
Months of Inventory: 40.20 (July 50.50)

The following information is for building lots in the same general area as the housing data listed above.

All Building Lots in the Greater St. George and Hurricane Valley

Active Listings: 1410 (1486 July)
New Listings: 123 (99 July)
Sold Listings: 7 (26 July)
Months of Inventory: 201 (57 July)

Here are the data ranges:

Building lots up to $100,000

Active Listings: 468 (527 July)
New Listings: 59 (33 July)
Sold Listings: 5 (20 July)
Months of Inventory: 201 (57 July) Just a decade and a half or so of inventory!

Building lots from $100,001 to $150,000

Active Listings: 405 (414 July)
New Listings: 28 (24 July)
Sold Listings: 0 (3 July)
Months of Inventory: No sales (138 July)

Building lots from $150,001 to $200,000

Active Listings: 207 (209 July)
New Listings: 14 (8 July)
Sold Listings: 2 (1 July)
Months of Inventory: 104 (209 July)

Building lots from $200,000 and up

Active Listings: 330 (336 July)
New Listings: 22 (34 July)
Sold Listings: 0 (2 July)
Months of Inventory: No sales (168 July) All I can say is YIKES!

Short Sales and Foreclosures

I am currently not taking too many more short sell listings unless it is payment in full to the first and shorting a second in a minor way. The problems is when you get too far apart, the national investors, think that they would rather foreclose than go through the gymnastics of putting the deal together, and in their minds get ripped off. Formerly, I was able to get 50-60% of mine to work out, but recently, through some unfortunate circumstances and some unqualified buyers my ratios have dipped dramatically. When representing a buyer, I still would not hesitate to make an offer on an approved short sell; it is just getting it to that point that is the challenge. If you are a buyer making an offer on an unapproved short sell, just be ready to wait for several weeks for about a 35% change of having the transaction work.

Foreclosures have really picked up lately. There are some good deals out there right now. Not the late night buy a house for $50, type deals, but homes that make sense and you can not build for what they are selling them for. I made two strong offers at the end of August for clients, and it looks like we did not get either deal to work, due to multiple offers! If you find a good foreclosure and the numbers make sense, make a good offer. If you do not make a good offer, expect to miss them, because multiple offers are coming.

As always, if you need anything or know someone who does, get a hold of me, I would love to help.

New Tax Assessment Got you down?

If you are anything like me, you had an emotional moment when you opened your “Notice of Property Valuation and Tax Changes” form recently. Mine changed from the jubilation of having that much equity in my house to a “wait just one second; I am getting gypped” feeling. To come clean, due to my profession, I went straight to the, “I am getting gypped” feeling, and I am sure several of you did too.

Long story short, we are being subject to the lag effect. Sure, my house, may have at one time in the summer of 2005 resembled the value indicated on this new proposal, but I can assure you, that if I could get that offer on my house today, I would run, not walk, to the title company with bells on my toes. One of the reasons why this happens, is the county breaks us up into 46 different “tax areas”, that are all statistically looked at annually, but are mandated to get re-appraised every five years. Hence, about every five years you can expect a change in your tax assessment, and it usually is in a direction that takes some bread off the table. I guess year five was up for me, and I do not like the results.

What can we do about it? I know my assessment is too high, so I am going to appeal it. I am all about paying my fair share, but in this case, the share I am being asked to pay, based on the county’s assessment of value is unfair. My proposed increase is well over $500 dollars per year, and if I did not go through this process I would automatically be agreeing to over $2,600 in ADDITIONAL tax before my next assessment. That is a lot of money, and we have not even had a presidential election yet. (Excuse the jab, all you agents of “change”). Sure, I probably will not get it back where it was, but even some adjustment would be helpful.

So this is what I am going to do. I am going to go and file an application with the County Board of Equalization. I can get these forms by either going there personally at 87 N. 200 E. St. George, (August 1-31 from 1:00-5:00pm) or I can call them at 435-652-5875. For those a bit more techno savvy, www.washco.ut.gov will get you the forms too.

If you choose to download them off their site, make sure you read all of the instructions. There are three sheets that need to be filled in and one instruction sheet. If you want, just email me and I will send them to you. joe@joelangston.com, (put “tax assessment forms” in the subject line).

To have your appeal considered, you are obligated to provide some proof. You can do this in one of three ways.

Current appraisal, by a professional fee appraiser
Closing statements, if you recently purchased the property
A minimum of three recent sales of properties that are similar, found on the MLS. (It does not say the MLS part exactly, but since Utah is a non-disclosure state, where else are you going to get the information?)

Once again, the altruistic and magnanimous Joe can help. I will need to know the following:

The name the Title to the property is being held in
Address
Parcel number located on “Notice” form
Number of bedrooms and bathrooms
Your best guess of size in square footage
Your previous assessed value, and proposed assessed value


If you will email me the information above, I can find these comparables for you. Some of the comparables will be better than others, and it all depends on what has sold in or around your area. I would love to do it for free, but I am anticipating a pretty big load, and after all, I need to feed the kids. So if you use my services, and you would like to make a “donation” for my time, it is not necessary, but would be appreciated.

Checks should be made out to ExSell Realty, and sent to 1251 S. 100 E. St. George, UT 84790 and should contain several digits of differing quantity and should impress the receiver significantly when opened. (Just kidding of course, a modest donation would be appreciated).

The appeal deadline is Sept 15, 2008 4:00pm, MDT. All appeal applications and evidence must be received prior to that time. You can choose to request an in person hearing, or let them make an adjustment, or not, based on your evidence. You decide. I bet you will do better if you show up.

I hope this helps! I look forward to all of our tax implications being closer to what they ought to be.

What happened in July in the Southern Utah Real Esate Market! (the stats)

Before we get started, I would like to thank the following individuals for the opportunity I had to help them close on a property in July:

1. Brian and Robyn Yardley (Purchase)
2. Alex and Jean Macpherson (Listing sold)
3. Duff Smith and Jane Rogers (Listing sold)
4. Jeannine Hendricks (Listing sold)
5. Dick and Jerilyn Abel (Purchase)

Thank you for your business! Alex and Jean Macpherson are fourth time customers and Dick and Jerilyn Abel are second time customers, Thanks a million for coming back!

According to the Washington County Board of Realtors multiple listing service, this is what happened in our market place in July. It looks like to me that there are a lot of opportunities for buyers out there, and if one needs to sell soon, that is in the next few months, it is time to get it on the market now! For buyers, I still think a good deal now... is a good deal, and if you have a two to five year plan of staying in a home, I would not hesitate if I saw something that met my needs.

I have decided to use stats based on the greater St. George area (St. George, Ivins, Santa Clara, and Washington) and the Hurricane Valley (Hurricane, La Verkin and Toquerville,) as our data base. That way everyone has an idea of the numbers based on the specific geography. That being said, here are the stats!

Total HOME listings on the MLS for July:

Total Active Listings: 2,527 (2,479 June)
New Listings in July: 519 (479 June)
Sold Listings in July: 139 (178 June)
Months of Inventory: 18.18 (13.93 June)

(Note: Months of Inventory assumes that no other homes are added to the current listings on the market, nor do any leave the market without being purchased, and they are absorbed at the same rate as the current month.)

Home (single family, townhouse and condo) listings in the $100-$150K range for July:

Total Active Listings: 175 (171 June)
New Listings in July: 26 (42 June)
Sold Listings in July: 19 (14 June)
Months of Inventory: 9.21 (12.21 June)

Home (single family, townhouse and condo) listings in the $150,001-$200K range for July:

Total Active Listings: 324 (313 June)
New Listings in July: 70 (73 June)
Sold Listings in July: 25 (27 June)
Months of Inventory: 12.96 (11.59 June)

Home (single family, townhouse and condo) listings in the $200,001-$250K range for July:

Total Active Listings: 407 (386 June)
New Listings in July: 81 (94 June)
Sold Listings in July: 31 (33 June)
Months of Inventory: 13.13 (11.7 June)

Home (single family, townhouse and condo) listings in the $250,001-$300K range for July:

Total Active Listings: 379 (360 June)
New Listings in July: 93 (68 June)
Sold Listings in July: 21 (31 June)
Months of Inventory: 18.05 (11.61 June)

Home (single family, townhouse and condo) listings in the $250,001-$300K range for July:

Total Active Listings: 379 (360 June)
New Listings in July: 93 (68 June)
Sold Listings in July: 21 (31 June)
Months of Inventory: 18.05 (11.61 June)

Home (single family, townhouse and condo) listings in the $300,001-$350K range for July:

Total Active Listings: 235 (219 June)
New Listings in July: 71 (45 June)
Sold Listings in July: 13 (18 June)
Months of Inventory: 18.08 (12.17 June)

Home (single family, townhouse and condo) listings in the $350,001-$400K range for July:

Total Active Listings: 188 (186 June)
New Listings in July: 36 (35 June)
Sold Listings in July: 9 (14 June)
Months of Inventory: 20.89 (13.29 June)

Home (single family, townhouse and condo) listings in the $400,001-$500K range for July: (notice larger range of asking price)

Total Active Listings: 233 (230 June)
New Listings in July: 46 (43 June)
Sold Listings in July: 7 (14 June)
Months of Inventory: 33.29 (16.43 June)

Home (single family, townhouse and condo) listings in the $500,001-$600K range for July: (notice larger range of asking price)

Total Active Listings: 151 (149 June)
New Listings in July: 33 (23 June)
Sold Listings in July: 3 (10 June)
Months of Inventory: 50.33 (14.9 June)* May had only 3 sales too, but April had 10 as well. Looks like you need to stick to even months if you are selling in this range.

Home (single family, townhouse and condo) listings in the $600,001-$750K range for July: (notice larger range of asking price)

Total Active Listings: 107 (112 June)
New Listings in July: 24 (15 June)
Sold Listings in July: 1 (1 June)
Months of Inventory: 107 (112 June)* Even I can do the math on this one!

Home (single family, townhouse and condo) listings in the $750,001 and UP!

Total Active Listings: 232 (247 June)
New Listings in July: 24 (27 June)
Sold Listings in July: 4 (6 June)
Months of Inventory: 58 (41.47 June)* If you are in the previous category, looks like you need to raise your price.

The next section is for building lots, not including raw land.

All Building Lots on the MLS for July:

Total Active Listings: 1,462 (1,519 June)
New Listings in July: 81 (110 June)
Sold Listings in July: 6 (21 June)
Months of Inventory: 243.67 (72.33 June)* not a typo, yes, over a 20 year supply!

Building lots under $100K

Total Active Listings: 504 (535 June)
New Listings in July: 24 (43 June)
Sold Listings in July: 4 (11 June)
Months of Inventory: 126 (48.68 June)*10 years isn’t so bad!

Building lots $100,001-$150K

Total Active Listings: 406 (419 June)
New Listings in July: 18 (37 June)
Sold Listings in July: 2 (3 June)
Months of Inventory: 203 (139.67 June)*Just a shade under 17 years for these!

Building lots $150,001-$200K

Total Active Listings: 209 (214 June)
New Listings in July: 6 (12 June)
Sold Listings in July: 0 (4 June)
Months of Inventory: Can’t divide by 0 (53 June)

Building lots $200,001 and above

Total Active Listings: 344 (352 June)
New Listings in July: 33 (18 June)
Sold Listings in July: 0 (3 June)
Months of Inventory: Can’t divide by 0 (117.33 June)

You might have notice after carefully analysing the data, that lots, unlike the years of 2004-5, are not currently at a premium. (I hope you appreciate the irony of this comment).

Short sells and foreclosures!

I hesitate to put this section in, because I know it is not accurate. I know some agents purposely do not code their listings as short sells or REO (Bank owned/foreclosed) for their own reasons. But, of the sold listings that are coded correctly in the month of July the MLS recorded three closed short sells and 29 closed REO (Bank owned/foreclosed) properties. I suspect we will see the REO stat on the rise by next update.

As always, for more information, including a free look at part of the MLS without having to speak to me, go to joelangston.com and click on “Find A Home”

If you would like a free ball park figure of value on your home, without me coming out to see it, go to joelangston.com and click on “Your Home’s Value”

Lastly, I am interested in your thoughts; please post them on the blog.

New Bill Passed!

President Bush signed the Housing and Economic Recovery Act of 2008 today, a bill that will assist an estimated 400,000 homeowners facing foreclosure by allowing them to refinance their current mortgages with a Federal Housing Administration-backed loan. The bill also permanently increases the conforming loan limit to as high as $625,500.

“One of the biggest reasons we’ve seen a slowdown in home sales is because buyers are having difficulty obtaining mortgage funds. That’s why this bill is significant: It increases the access to affordable, stable mortgages,” said Chris Sloan, president-elect of the Utah Association of REALTORS®.

The new loan limits for Fannie Mae and Freddie Mac are the greater of either $417,000 or 115 percent of an area’s median home price, up to $625,500. The new FHA loan limit will be the greater of $271,050 or 115 percent of an area’s median home price, up to $625,500. Both new loan limits will be effective at the expiration of the economic stimulus limits on December 31, 2008.

Another part of the bill includes a temporary tax credit for first-time home buyers of up to $7,500 for those who purchase between April 9, 2008, and July 1, 2009. This credit is available to anyone buying their first house or anyone who has not owned in three years. Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full credit. A home is eligible for the credit if it is any residence that will be used as a primary residence (single-family, townhouse, condo, etc.)

For more detailed information about the bill and the tax credit, visit www.Realtor.org. Another Web site, www.federalhousingtaxcredit.com, also provides information about the tax credit.

New Housing Bill gives Mortgage Relief for Southern Utah Real Estate and National Home Owners

This Article was printed on July 25, 2008 in the New York Times by Ron Liber and was titled

"Housing Bill that Has Something for Nearly Everyone"

If you are ignoring the housing bailout bill because you think it benefits only troubled homeowners, you may miss out on a windfall.
The bill, expected to be passed by the Senate in the next few days and then signed by
President Bush, does offer incentives to certain overextended borrowers and their
mortgage lenders. But it also includes many handouts to first-time home buyers, longtime homeowners, returning veterans and senior citizens seeking to tap their home equity without getting hit with big fees. Millions of people have the potential to benefit in some way. Huge numbers of people buying homes for the first time, for instance, will be eligible for what amounts to an interest-free loan from the government. Meanwhile, older Americans will now be able to borrow more and possibly pay less for reverse mortgages that allow them tap the equity in their homes. Whether larding up the bill with all these benefits is good for taxpayers is a debate for another part of the newspaper. But there is no shame in taking advantage of what is offered. In fact, you would be foolish not to. Here are some of the new benefits:

Renegotiating Mortgages

Part of the bill is devoted to the creation of a program that may allow some people to cancel their old mortgage loans and replace them with new fixed-rate loans lasting at least 30 years. The amount of the new loans would be no more than 90 percent of what their property is actually worth now.

So who is eligible? You need to have originated your troubled loan or loans on or before Jan. 1, 2008. The loans in question must be on your primary residence. Vacation homes and investment properties are ineligible. You will also need to verify your income, which many borrowers did not have to do in recent years. Also, as of March 1, 2008, your monthly housing payment (including the principal on all your various mortgage payments, interest, taxes and insurance) has to have been at least 31 percent of your monthly household income. So if you were earning $5,000 a month and had housing payments of $3,000, you are eligible. But if you had payments of just $1,400, you would not be, presumably because that loan is affordable given the size of your income. Lenders, however, are not required to give you a better deal under the new law, even if you do meet the qualifications. They may not be willing to negotiate unless they think you are truly on the cusp of foreclosure.
If you manage to get a new loan, you cannot take out a home equity loan for at least
five years after you get the new mortgage. You will also have to pay a 1.5 percent fee each year on the remaining balance.
Finally, you have to hand over no less than 50 percent of any appreciation on the home to the government once you sell. Sell the house in less than five years, and you will have to turn over as much as all of the gain. This program ends on Sept. 30, 2011. While it does not officially take effect until Oct. 1, lenders may be willing to start their negotiations with borrowers now.

Break for First-Time Buyers


If you are buying a home for the first time, and it is your primary residence, you are eligible for a federal tax credit of $7,500 or 10 percent of the purchase price, whichever is smaller. With a tax credit, you subtract the credit amount from the total you would otherwise pay to the Internal Revenue Service. So if you owe $1,500 and you qualify for the credit, you would end up getting a $6,000 refund.
There are two big catches, though. If you earn a modified adjusted gross income of
more than $75,000, or $150,000 if you are married and filing your tax return jointly, the credit starts to phase out. For single people, it phases out completely at $95,000 of annual income, while for married people filing jointly, it phases out at $170,000. But you have to pay back the credit over the next 15 years, in equal amounts each year when you pay your federal taxes. That makes this more like an interest-free loan than a true credit. According to the National Association of Realtors, there were about 2.5 million first-time home buyers in 2007.
A large proportion of them would have qualified for this credit, but whether it is enough to push would-be buyers over the edge this year remains to be seen.
The tax credit is retroactive to home purchases on April 9, 2008, and expires on July 1, 2009. If you purchase a home from Jan. 1, 2009 to June 30, 2009, you can claim the tax credit on your 2008 tax return.

Additional Deduction

If you are a homeowner who takes the standard deduction on your federal income taxes and does not itemize, this one is for you. You can now take an additional federal tax
deduction of $500, or $1,000 if you are married and filing your tax returns jointly. Again, this one is gravy; you get it in addition to the standard deduction.
Since itemizers are often people who pay a lot of mortgage interest, this deduction will generally benefit people who pay little or none, like those who have paid off their mortgages entirely or close to it. There is one hitch here: you will need to report the property taxes you paid on your tax form. If they are less than $500 (or $1,000 if you are married and filing a joint return), your deduction will be limited to the amount of the property tax you paid.

Reverse Mortgage Changes

Reverse mortgages allow older Americans, generally 62 and older, to get a lump sum or a monthly check that comes out of their home equity. They do not have to pay the money back until they stop living there permanently or their heirs sell the house. The problem with these loans, however, is that they often come with high fees.
Moreover, some salespeople pressure borrowers who are applying for the loan to
purchase annuities, long-term care insurance or other financial products that are not
necessarily in the borrower’s best interest. The bill tries to address both issues. First, it limits origination fees on reverse mortgages at 2 percent of any loan up to $200,000 and 1 percent beyond that, up to a maximum of $6,000. The bill also states explicitly that borrowers cannot be forced to purchase an annuity or other financial or insurance product as a condition of qualifying for a reverse mortgage.

Finally, the bill raises the maximum amount that people can borrow. Before, the limits were set on a county by county basis, according to AARP’s legislative policy director, David Certner. The biggest allowable mortgage available anywhere was just over $400,000. Now, there is a nationwide cap of $625,500.

Redefinition of Jumbo Loans

Often, if you want the mortgage loan with the lowest possible interest rate, it has to be
small enough to be purchased by Fannie Mae or Freddie Mac from whatever bank or
other institution originated it. Under the new bill, Fannie and Freddie have permanent authority to buy bigger loans in areas with high housing costs. (Temporary measures allow them to buy bigger loans, but those expire on Dec. 31.) They can buy loans up to 115 percent of the local median home price, though they cannot buy any loans larger than $625,500. Any larger loan will
generally be a jumbo loan, which will cost more in interest.

A Break for Veterans

Lenders will have to wait nine months, instead of 90 days, before beginning foreclosure proceedings on homes owned by someone returning from the military. Lenders must also wait a year before raising interest rates on a mortgage held by someone returning from military service. These provisions expire on Dec. 31, 2010.

Note from Joe...

Interesting news coming down. I imagine these steps may take some pressure off the short sale and foreclosure market. I really hope some or all of this can gain if this legislation comes into being. On a personal note, I would like to thank Dr. Harper for sending this article. He so often provides germain information to our market.

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Foreclosures in the Southern Utah Real Estate Market

The following information comes from RealtyTrac, which is an online foreclosure tracker/seller on a national level. Though foreclosures are extremely financially and emotionally difficult on the families of those losing their homes, it is a necessary part of the market re-adjusting itself to meet the standards dictated by the market.

This is part of the ugly aftermath that was created by the perfect storm in real estate that in my mind started in the Spring of 2004 and lasted until about October of 2005.

Through this difficult process, home prices are currently adjusting back to levels where the working class citizen can actually purchase a home, and hopefully the lending institutions will establish some guidelines that will safeguard us from the affects of our past.

Contrary to my opinion in a previous post, there just may be some foreclosures coming out of the woodwork that are going to start to make sense through this process.

St. George Foreclosure Rate Among Nation's Highest
Ranks 27th among metro areas

ST. GEORGE - The St. George area ranked 27th among metro areas nationally for its rate of home foreclosure filings in June, with one foreclosure for every 245 properties - the highest rate among cities in Utah.

St. George had a 13 percent hike in foreclosure filings from May to June of this year and 174 percent year-over-year increase, according to a report from RealtyTrac.

The number of Utah homeowners who received a foreclosure filing in June jumped nearly 141 percent, compared with the same month last year, according to RealtyTrac.

The 140.54 percent increase was almost three times the national increase of 53.28 percent for the same period.

The most dramatic increase came from Utah County, where the Provo/Orem area ranked 37th among metro areas nationwide in the rate of foreclosures and experienced an 810 percent increase in foreclosure filings from June 2007 to June 2008.

The Beehive State had a rate of one foreclosure for every 600 households last month. The national average for the period was one foreclosure in every 501 households.

Overall, Utah ranked 10th among the states in the rate of foreclosure filings.

Salt Lake City was ranked 89th in the nation, with a rate of one foreclosure filing for every 662 households. The percentage change from June 2007 to this past June was 60 percent.

The states of Nevada, California and Arizona continued to lead the nation in the rate of foreclosure filings, the report said.

Nevada was up nearly 85 percent from June 2007, with one in every 122 households receiving a foreclosure filing. California had second-highest rate, with one in every 192 properties receiving a foreclosure filing in June, while Arizona ranked third at one in every 201 households.

This information confirms the fact that this is a national epidemic, and not just our neighborhood. So what does it mean? I still maintain it is a good time to buy. As some of these foreclosures come out, they are worth taking a look at, but do not step over a motivated seller that has equity. Sometimes they are the best to deal with.

Once again, if you need to sell soon, it is time to do it.

Click here to search sections of the MLS without having to talk to me, then click Find A Home.

Click here for a good estimate of your homes value without having to talk to me personally. Then go to Your Home's Value.

What is a "short sell" in the Southern Utah or St. George Real Estate Market?

In simple terms and circumstances, a short sell is a scenario when a banking institution or lien holder accepts less than what is owed on a property, and releases the lien to clear title to a new buyer. They may or may not release the seller from a future obligation to them for the amount of the mortgage not covered by the sell. This is an issue of solvency, or in other words, the seller's ABILITY to pay. Short sells are a loss-mitigation tactic that is used in lieu of foreclosure at the banks or lien holder's option, and is usually done when the lien holder feels it is a better option than foreclosure.

What is the process? (When a listing agent is involved)

When I list "short sells" I meet with a seller about their current situation. If there has been a "Hardship" such as a loss of employment, sickness, death, law suit or sincere bad luck, they may be a good candidate for a short sell. In addition to normal listing paperwork for their house we collect information such as the following:

Authorization to release information
Last two months pay stubs
Last two months bank statements
Last two years taxes
Financial worksheet
Hardship letter
Accompanying documentation
Other institutional and supporting documentation.

Before I get an offer, I send the "Authorization to release information" to the lending institution. This enables them to speak to you when you do get an offer. At that point, it is really good idea to ask them if they have a specific package, because, though my generic one covers nearly every situation, sometimes they want it on "their form".

Once we get an offer, I get a pro-forma settlement statement from the Title Company indicating what the net proceeds would be to the lien holder. Armed with that information, I then create a cover letter showing the lien holder how much money they would receive as a percentage of what they are owed, and all of the reasons and circumstances as to why this poor person is in this situation, and with the current market status how they would be absolute fools not to accept this instead of foreclosing. I attach the Real Estate Purchase contract and the documentation listed above and I sent it the loss mitigation department of whoever is the lending institution.

How long does it take?

Most banks/lien holders that accept short sells are very busy, and it could easily take about two to four weeks to get assigned to someone, and possibly another four to eight to be analyzed or processed. Sometimes they just get ignored or buried under hundreds of others, and despite our best efforts, there is nothing we can do.

Some of the tricks my office manager and I have used to get them looked at a little bit quicker are the following:

1. Call as much as possible. Plan on being “on hold” for at least a half of an hour and probably more than an hour.
2. Ask to speak to the supervisor.
3. Flatter them and be very kind. Give them the speech about Eagles and chickens and they sound like an eagle.
4. Ask for email address. They usually won't give you one, but if you say they wanted you to send something via email, they just may.
5. Get the loss mitigators personal fax, and fax them a message.

How often do short sells work?

It really depends on the circumstances and how many notes are involved and who the banks are. I have been able to with a lot of help from my good assistant, the client’s attorney and an iron gut from both seller and buyer; pull a house out of a bankruptcy to get one to work. I have also had a great offer on one, they denied based on a less informed appraiser only to see them sell it for $20k less after they painted it and foreclosed it.

Unfortunately the national average is about 35% of the time. My percentage is a little closer to 50%, and we really feel like we have a handle on things. We know however, we have a lot to learn, and could be better. We get “ah-ha's”every time. Though we are not looking to do these are our primary real estate source, we know how to do them and are happy when the real NEED is there.

If you know of anyone who may need this service, let me know by email. We would be happy to consider each case on a one by one basis.

Once again, if you want to search the multiple listing service for you St. George area home, or to get your own Southern Utah home assessed for FREE, just go to http://www.joelangston.com/