Orlando Real Estate Voice, Short Sale Expert & Specialist

Sales of homes in some stage of foreclosure declined in the first three months of the year, but they still accounted for 28 percent of all home sales — a share nearly six times higher than what it would be in a healthy housing market.

Foreclosure sales, which include homes purchased after they received a notice of default or were repossessed by lenders, hit the highest share of overall sales in a year during the first quarter, foreclosure listing firm RealtyTrac Inc. said Thursday.

“It’s an astronomically high number,” said Rick Sharga, a senior vice president at RealtyTrac. “In a normal market, you’re looking at the percentage of homes sold in foreclosure to be below 5 percent.”

The pace at which homes are entering the foreclosure process has slowed in recent months amid bank and court delays. But distressed properties remain a fixture of a housing market still searching for a sustained recovery. The properties, often in need of repair, typically sell at a discount, weakening prices for other types of homes.

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As a slice of all home purchases, foreclosure sales peaked two years ago at 37.4 percent. In the first quarter, they rose from 27 percent in prior quarter, but fell from 29 percent a year earlier, according to RealtyTrac.

Sales of foreclosure properties didn’t fare much better than other types of homes, however.

In all, 158,434 homes in some stage of foreclosure were sold in the first quarter, down 16 percent from the last three months of 2010 and down 36 percent versus a year ago. Sales of all other types of homes also declined sharply, according to RealtyTrac’s figures, which differ from other home-sales estimates.

While the number of bank-owned properties sold declined, they grew as a share of all home sales. Bank-owned homes accounted for nearly 19 percent of all sales, up from 17 percent in the fourth quarter and up from 18 percent a year ago, the firm said.

That’s not good news for the housing market.

Story: Bill would let appraisers ’round up’ home values

RealtyTrac estimates there are 872,000 homes that have been repossessed by lenders, but have yet to be sold. At the first-quarter’s sales pace, it will take three years to clear the inventory of 1.9 million properties already in some stage of foreclosure.

For bank-owned properties alone, that amounts to a 2-year supply.

“Clearly, the housing market is not out of the woods,” Sharga said.

Homebuyers who purchased a bank-owned home in the first quarter saved an average of 35 percent versus the average price of other types of homes, RealtyTrac said.

That discount is unchanged from the previous quarter, but up from an average of 33 percent a year ago.

Buyers who snapped up other homes in the foreclosure process, including short sales, got an average discount of 9 percent, the firm said. That’s down from an average of 13 percent in the fourth quarter and an average of 14 percent a year ago. In a short sale, the seller and their lender agree to sell the home for less than what is owned on the mortgage.

The biggest foreclosure discounts were to be had in Ohio, where foreclosure properties sold for an average of 41 percent less than other types of homes, RealtyTrac said.

The average sales price of a foreclosure property was $168,321, down 1.9 percent from the fourth quarter and 1.5 percent from the first quarter last year, the firm said.

At a state level, Nevada led the nation with foreclosure sales accounting for 53 percent of all home sales, RealtyTrac said. That was down from 59 percent the year before.

The state has the highest foreclosure rate in the nation and an inventory of nearly 28,000 bank-owned properties on bank’s books. Buyers scooping up foreclosure properties there in the first quarter got an average discount of nearly 18 percent compared to the average sales price of other types of homes, RealtyTrac said.

In California, foreclosure sales accounted for 45 percent of all home sales in the first quarter, down from nearly 48 percent a year earlier. The average foreclosure property sold for nearly 34 percent less than the average sales price of homes not in foreclosure.

In Arizona, foreclosure sales represented 45 percent of all home sales for the quarter, down from 47 percent a year earlier.

Several other states had foreclosure sales that accounted for at least one quarter of all home sales in the first quarter: Idaho, Florida, Michigan, Oregon, Virginia, Colorado, Illinois, Georgia and Ohio.

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden, Kissimmee, St. Cloud, East Orlando, Longwood, Altamonte Springs, Maitland, Winter Park, Oviedo, Apopka, Lake Mary, Clermont, Ocoee  Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area.

Please visit:

Avoid Foreclosure / Short Sale Help  http://OrlandoShortSaleExpert.com, or http://ShortSellMyOrlandoHome.com

Our Website http://JerryLaRose.com or www.JerrySellsOrlando.com,  or http://OrlandoRealEstateVoice.com ,

If you’re a Buyer looking for Great Deals –  http://InvestmentPropertyDealsOrlando.com

Please give me a call if you have questions about the Orlando and Central Florida real estate market.

P.S. If you are listing your home as a short sale in Orange, Seminole, Polk, Lake  or Osceola County Florida and Orlando, East Orlando, St. Cloud,  Davenport, Clermont, Longwood, Windermere, Winter Garden,  Kissimmee, Winter Park, Altamonte Springs, Maitland,  Apopka,  Lake Mary, Oviedo or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. The short sale process is complicated and we can help simplify it.

Call us at 407-580-7011 or email at jerry@JerryLaRose.com to find out more about Orange County Short Sales and Orlando Area Short Sales

A wave of foreclosures is forcing down home prices in most major U.S. cities. But economists and real estate agents are noticing what they call a key first step for any housing recovery: a drop in the glut of homes for sale in markets hit hardest by foreclosures.

Low prices are leading investors to snap up foreclosed homes in Detroit, Las Vegas, Miami, Phoenix and Tampa. Those cut-rate sales are reducing prices in the short run. Yet they’re also thinning the supply of homes – clearing the way for higher prices in the long run.

For some buyers, the deals are now too good to pass up. A studio apartment on the Las Vegas strip that cost $500,000 at the height of the housing boom is now selling for roughly one-third that price. Half the homes listed in the Tampa Bay area are selling for less than $100,000, not far from some of Florida’s top Gulf Coast beaches.

Such sales have helped shrink the combined supply of unsold homes in those five cities by 13 percent over the past year, according to local listing data analyzed by The Associated Press. Home prices in each of those markets are at or below 2002 levels, according to the latest reading of the Standard & Poor’s/Case Shiller 20-city home price index.

“If we were to see several consecutive months of supply getting smaller, it would point to an improving housing market,” said Celia Chen, senior director at Moody’s Analytics. “Even if it is investors buying them, they are renting them out in hopes that prices in the next several years will rise.”

Economists caution that a second wave of foreclosures, those that have been delayed by banks and backlogged courts, could throw the housing market back into turmoil. And few see home prices rebounding before the end of this year.

Home prices fell from January to February in 19 of the 20 metro markets tracked by the Case-Shiller index. At least 10 major metro areas are at their lowest point since the housing bubble burst. The index, released Tuesday, is slightly above the level reached in April 2009, the lowest point since the downturn began.

Getting rid of foreclosures and other risky properties is necessary for the market to turn around. When foreclosures and distressed properties are sold, home prices fall.

But as the supply of cheap homes shrinks, prices stabilize. Homeowners who had put off moving because they didn’t want to sell during the downturn grow confident that they can fetch a decent price. That prompts more buying and selling. Prices rise more.

Most of the current foreclosure sales involve investors: Private equity firms; foreign and out-of-state buyers seeking vacation houses; individual investors hoping to rent out or quickly sell properties for a profit.

Many are scooping up cheap homes with cash, said Andrew Duncan, a Realtor who runs a Keller Williams franchise in Tampa. In March, 35 percent of previously occupied homes sold were bought entirely in cash, according to the National Association of Realtors.

“When the bargains do hit, there’s more than one buyer looking for that bargain,” Duncan said. “Buyers are losing out left and right when they bid because it’s just so competitive.”

Foreclosures have flooded the market in Miami. Three out of five homes sold there are foreclosures or short sales. (Short sales occur when lenders allow homes to be sold for less than what’s owed on the mortgage.) Such sales have helped lower the median home price by 19 percent in the past year, to $159,800 in March.

At the same time, the supply of Miami-area homes for sale has dropped nearly 24 percent. It would take just seven months to clear those homes at the current sales pace. That’s down from a 17-month supply just six months ago.

In Tampa, it would take just six months to clear the supply of unsold homes off the market. That’s down from about eight months a year ago and 25 months in January 2008. Detroit’s inventory of homes for sale has fallen 17 percent in the last year.

In Phoenix, the number of homes for sale has dropped nearly 10 percent over the past year. The median sales price of a single-family home sold last month was $118,500 – down more than 12 percent from a year ago.

The supply of homes in Las Vegas could be cleared in less than seven months at the current sales pace. That’s down from a 26-month supply in December 2007.

“It’s like a feeding frenzy when a home goes on the market now,” said Mike Shannon, a Detroit real estate agent who specializes in foreclosures. “We’re getting a few dozen offers on some homes in a matter of days.”

The thinning supply is due, in part, to a lull in foreclosures. They’ve dropped more than 56 percent in Tampa and nearly 64 percent in Miami. In those areas, the number of homes receiving an initial foreclosure notice has plummeted.

That could change quickly. Many banks are revisiting thousands of foreclosure cases. They’ve been spurred into action by federal regulators who have ordered reviews of how foreclosures were carried out over the past two years.

The logjam has been compounded in states such as Florida, New York and New Jersey, where a judge must approve foreclosures.

There are 1.2 million foreclosures expected this year nationally, according to foreclosure tracker RealtyTrac Inc., and the decline in foreclosure filings is only temporary, said Mark Vitner, senior economist at Wells Fargo.

“The problems are still there,” Vitner said. “There are fewer early-stage delinquencies, so we are moving in the right direction. But the slowdown in foreclosures is just drawing the process out.”

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden, Kissimmee, St. Cloud, East Orlando, Longwood, Altamonte Springs, Maitland, Winter Park, Oviedo, Apopka, Lake Mary, Clermont, Ocoee Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area.
Please visit:
Avoid Foreclosure / Short Sale Help http://OrlandoShortSaleExpert.com, or http://ShortSellMyOrlandoHome.com
Our Website http://JerryLaRose.com or www.JerrySellsOrlando.com, or http://OrlandoRealEstateVoice.com ,
If you’re a Buyer looking for Great Deals – http://InvestmentPropertyDealsOrlando.com
Please give me a call if you have questions about the Orlando and Central Florida real estate market.
P.S. If you are listing your home as a short sale in Orange, Seminole, Polk, Lake or Osceola County Florida and Orlando, East Orlando, St. Cloud, Davenport, Clermont, Longwood, Windermere, Winter Garden, Kissimmee, Winter Park, Altamonte Springs, Maitland, Apopka, Lake Mary, Oviedo or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. The short sale process is complicated and we can help simplify it.
Call us at 407-580-7011 or email at jerry@JerryLaRose.com to find out more about Orange County Short Sales and Orlando Area Short Sales.

Although home values have fallen over the past few years, housing affordability has significantly decreased for working owners and renters, according to an annual report released by the Center for Housing Policy, the research affiliate of the National Housing Conference.

The report, titled “Housing Landscape 2011,” provides an in-depth look at housing affordability trends for working households between 2008 and 2009 focusing on the effects of employment, income and housing costs.

According to the report, nearly one in four working households had a severe housing cost burden in 2009, spending more than half of its income on housing costs. Nationwide, some 10.5 million working households experienced a severe housing cost burden in 2009 – an increase of nearly 600,000 households from the prior year. This increase occurred despite a drop of 1.1 million in the overall number of working households.

“Housing costs for existing homeowners have declined only slightly, while housing costs for working renters have actually gone up,” said Jeffrey Lubell, Executive Director of the Center for Housing Policy. “Meanwhile, high unemployment and falling incomes have left low- and moderate-income families struggling to make ends meet.”

The study found that five states’ share of severely cost-burdened working households exceeded the national average, and they had a statistically significant increase between 2008 and 2009: Florida, Arizona, California, New Jersey and New York.

Among the 50 largest metropolitan areas, the following five metropolitan areas had the highest share of working households with a severe housing cost burden in 2009:
• Miami-Fort Lauderdale-Pompano Beach: 42 percent
• Los Angeles-Long Beach-Santa Ana, Calif.: 37 percent
• Orlando-Kissimmee: 35 percent
• Riverside-San Bernardino-Ontario, Calif.: 35 percent
• San Diego-Carlsbad-San Marcos, Calif.: 34 percent

Nationally, housing affordability declined substantially for working renters across the country. Approximately one-fourth of working renters (24.5 percent) had a severe housing cost burden in 2009 – an increase over the 22.1 percent with the problem in 2008.

Housing affordability declined among homeowners as well. Some 21.2 percent of working homeowners had a severe housing cost burden in 2009, as compared with 20.1 percent in 2008.

The report identified several factors as contributing to the decline in housing affordability, including an increase in rents, a reduction in the number of hours worked per week, and falling incomes.

In a state-to-state comparison, the share of working households with a severe housing cost burden increased significantly in 25 states and decreased significantly in none. The share of working households with a severe housing cost burden increased significantly in 16 of the largest metropolitan areas and decreased significantly in none. Of these 16 metro areas, 14 are located in the Midwest and the South.

Overall, the level of severe housing cost burden amongst working households displayed a high level of variation at the metropolitan level. Levels ranged from a high of 42 percent in Miami to a low of 15 percent in Pittsburgh and Louisville.

The complete report, “An Annual Look at the Housing Affordability Challenges of America’s Working Households,” is available in PDF format online.

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden, Kissimmee, St. Cloud, East Orlando, Longwood, Altamonte Springs, Maitland, Winter Park, Oviedo, Apopka, Lake Mary, Clermont, Ocoee Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area.
Please visit:
Avoid Foreclosure / Short Sale Help http://OrlandoShortSaleExpert.com, or http://ShortSellMyOrlandoHome.com
Our Website http://JerryLaRose.com or www.JerrySellsOrlando.com, or http://OrlandoRealEstateVoice.com ,
If you’re a Buyer looking for Great Deals – http://InvestmentPropertyDealsOrlando.com
Please give me a call if you have questions about the Orlando and Central Florida real estate market.
P.S. If you are listing your home as a short sale in Orange, Seminole, Polk, Lake or Osceola County Florida and Orlando, East Orlando, St. Cloud, Davenport, Clermont, Longwood, Windermere, Winter Garden, Kissimmee, Winter Park, Altamonte Springs, Maitland, Apopka, Lake Mary, Oviedo or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. The short sale process is complicated and we can help simplify it.
Call us at 407-580-7011 or email at jerry@JerryLaRose.com to find out more about Orange County Short Sales and Orlando Area Short Sales.

When do I need to purchase to qualify?
If you buy a home between Jan. 1 and Dec. 1 this year and close escrow during these dates, you will qualify for an $8,000 tax credit – as long as it is your primary residence and you meet the simple requirements.
How does the law define “first-time homebuyer”?
The law defines “first-time homebuyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase.
What are other requirements to qualify?
All U.S. citizens who file taxes are eligible to participate. An income limit of $75,000 a year for individuals and $150,000 a year for joint filers also applies.
How do I apply for the credit?
Taxpayers should use IRS Tax Form 5450 to claim the first-time homebuyer tax credit.
Does the credit have to be repaid?
No. Unlike a similar tax credit passed in 2008, this $8,000 tax credit does not have to be repaid to the IRS.
Can I use the tax credit toward a down payment or other closing costs?
Yes. An announcement made May 29 allows the tax credit to be used toward purchase costs of a home, including down payment in some cases. This can be done one of two ways. First, buyers using an FHA-approved lender can sell their anticipated tax credit to the lender and use the proceeds to immediately apply the tax credit to any down payment above the minimum down payment of 3.5 percent required with FHA-insured mortgages. Second, buyers who receive financing through state housing finance agencies and certain non-profits will be able to use the tax credit for their down payments via a tax credit advance loan that does not result in any cash back to the buyer.

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit http://OrlandoShortSaleExpert.com or www.JerrySellsOrlando.com for your real estate needs. Please give me a call if you have questions about the Orlando and Central Florida real estate market.
P.S. If you are listing your home as a short sale in Orange County Florida and Orlando, Windermere, Winter Garden, or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. Call us at 407-580-7011 to find out more about Orange County Short Sales and Orlando Area Short Sales.

On February 18, 2009, President Obama announced his Making Home Affordable Program (MHA), designed to help up to 7-9 million families avoid foreclosure by restructuring or refinancing their mortgages. In doing so, the plan not only helps responsible homeowners behind on their payments or at risk of defaulting, but prevents neighborhoods and communities from being pulled over the edge too, as defaults and foreclosures contribute to falling home values, failing local businesses, and lost jobs.

For more detailed information, visit MakingHomeAffordable.gov.

Making Home Affordable Program (MHA):
Guidelines and Latest News

The Plan
On March 4, 2009, the Obama Administration announced new U.S. Department of the Treasury guidelines to enable servicers to begin modifications of eligible mortgages under the Administration’s Making Home Affordable Program (MHA) – announced by President Barack Obama on February 28, 2009.
NAR’s Detailed Summary of the Obama Housing Plan> (PDF: 112K)
Key Components of the Plan>
Modification of Second Mortgages
On April 28, 2009, the Treasury Department announced an expansion of the Making Home Affordable Program (MHA) to help reduce payments on second mortgages.
Modification of Second Mortgages under the Making Home Affordable Program> (Treasury Dept.)
Financial Incentives and Uniform Process for Short Sales – The Foreclosure Alternatives Program (FAP)
On May 14, 2009, Treasury Secretary Geithner and HUD Secretary Donovan announced new details on the Making Home Affordable Program to help homeowners facing foreclosure.
Treasury Department press release> (Treasury Dept.)
Realtors® Help Buyers, Sellers Navigate Short Sales>
Uniform Process for Short Sales Will Help Struggling Home Owners>
View detailed guidelines> (PDF: 316K)
Treasury’s FAP factsheet> (PDF: 44K)
Visit the Treasury Department links below for the latest guidelines and information:

Making Home Affordable – Summary of Guidelines> (PDF: 53K)

Borrower Information: Making Home Affordable Refinance and Modification Options

Borrower Q&As> (PDF: 82K)

Housing Counselor Q&As> (PDF: 72K)

Modification Program Guidelines> (PDF: 90K)

Fact Sheet – Updated Detailed Program Description> (PDF: 73K)

Modification of Second Mortgages under the Making Home Affordable Program>

New Details of the Program to Help Homeowners Facing Foreclosure>

Fact Sheet – The Foreclosure Alternative Program (FAP)> (PDF: 44K)

Making Home Affordable Progress Report, May 14, 2009> (PDF: 20K)
Fannie Mae and Freddie Mac Guidelines
Fannie Mae and Freddie Mac released guidelines on refinancing and loan modification options that implement President Obama’s Making Home Affordable Program.
GSEs Home Affordable Refinancing Programs>
GSEs Home Affordable Modification Programs>
Determining if a borrower’s loan is owned or securitized by Fannie Mae or Freddie Mac:

For Fannie Mae, 1-800-7FANNIE (8am to 8pm EST).
www.fanniemae.com/loanlookup

Freddie Mac, 1-800-FREDDIE (8am to 8pm EST)
www.freddiemac.com/avoidforeclosure

Part of NAR’s Right Tools, Right Now Initiative
In these uncertain times, NAR is here to help you succeed with the Right Tools, Right Now initiative, offering more than 300 educational products, publications, and services free or at cost. For more information, visit www.REALTOR.org/RightTools.

Shuttle Launch

Government officials launching the “Making Home Affordable” program also acknowledge that the initiatives are only a partial fix for a sweeping problem that has helped plunge the U.S. economy into the worst recession in decades. In fact, tens of thousands of homeowners in some of the most battered real estate markets – concentrated in California, Florida, Nevada and Arizona

There was also skepticism that banks would be willing to participate.

The Obama administration’s program has two parts: one to work with lenders to modify the loan terms for up to 4 million homeowners, the second to refinance up to 5 million homeowners into more affordable fixed-rate loans.

For the modification program, borrowers who are eligible will have to provide their most recent tax return and two pay stubs, as well as an “affidavit of financial hardship” to qualify for the loan modification program, which runs through 2012.

Borrowers are only allowed to have their loans modified once, and the program only applies for loans made on Jan. 1, 2009

For the refinance program, only homeowners whose loans are held by Fannie Mae or Freddie Mac are eligible and have until June 2010 to apply.

Consumers should contact their loan servicer – the company that sends out their monthly bill – to find out if their mortgages are held by Fannie or Freddie. The two mortgage finance companies own or guarantee almost 31 million home loans – more than half of all U.S home mortgages.

Many mortgage brokers, however, are critical. They argue the fees imposed by Fannie and Freddie over the past year make it difficult for borrowers to afford to refinance. The two companies, which are now government controlled, have yet to detail how they will implement the plan, or whether any fees will be rolled back.

Meanwhile, action to put in place another part of Obama’s housing plan is expected soon on Capitol Hill.

House Democrats agreed Tuesday to narrow proposed legislation that gives bankruptcy judges the power to change the terms of mortgage loans for debt-strapped borrowers.

In the latest version of the bill, judges would have to consider whether a homeowner had been offered a reasonable deal by the bank to rework his or her home loan before seeking help in bankruptcy court. Borrowers also would have a responsibility to prove that they tried to modify their mortgages.

A full vote in the House could come as early as Thursday.

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Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of Real Estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit http://OrlandoShortSaleExpert.com or www.JerrySellsOrlando.com for your real estate needs. Please give me a call if you have questions about the Orlando and Central Florida real estate market.

P.S. If you are listing your home as a short sale in Orange County Florida and Orlando, Windermere, Winter Garden, or Ocoee Florida make sure you hire an agent who knows how to do short sales and has the experience to get the job done. We are doing successful short sale packages. Call us at 407-580-7011 to find out more about Orange County Short Sales and Orlando Area Short Sales.