Friday, January 21, 2011

FHA extends suspension of 'anti-flipping' rule for another year

The rule was intended to prevent speculators from defrauding the government, but it also stifled the purchase and renovation of foreclosed homes by legitimate investors.

Reporting from Washington —
For years the federal government prohibited the use of Federal Housing Administration mortgage financing by buyers purchasing homes from sellers who had owned the property for less than 90 days. The idea was to prevent speculators from defrauding the government through quick flips of houses — often involving straw buyers and corrupt appraisers — at wildly inflated prices.
One side effect of that policy had been to stifle purchase-and-renovate projects by legitimate, small-scale investors who buy houses after foreclosure or loan defaults and then resell them in substantially improved condition. In many parts of the country, first-time and moderate-income buyers often sought to buy these fixed-up houses using FHA-insured mortgages with 3.5% down payments, but were prevented from doing so by the "anti-flipping" rule.

This left large numbers of foreclosed, vacant houses sitting unsold and deteriorating, with negative effects on the values of neighboring properties.
Last January, FHA Commissioner David H. Stevens announced a one-year suspension of that rule, permitting qualified buyers to obtain FHA mortgages on properties that were acquired by rehabbers less than 90 days before. The plan, set to expire at the end of this month, came with safeguards for purchasers, including inspections and multiple appraisals in some cases to document the amounts spent by investors on the improvements.
Vicki Bott, deputy assistant secretary for single-family housing at the FHA, confirmed in an interview that the agency expects to continue the policy for another year. Not only have first-time buyers responded overwhelmingly to the opportunity to buy "turnkey" renovated homes with low down payments, she said, but they have performed well on their mortgage obligations.
"Obviously we have concerns about flipping in general," Bott said, but the FHA has seen none of the fraud problems, defaults and re-foreclosures that cost the agency millions in insurance payouts in earlier years.
Investor Paul Wylie, who with a group of partners and contractors specializes in acquiring, renovating and reselling foreclosed and distressed houses in the Los Angeles area, says the government's policy "has been a very positive approach" because "it recognizes the role that [private investors] can play in helping the housing market get back on its feet."
In the L.A. market, Wylie said, FHA financing accounts for 40% of all home purchases and 60% of purchases in predominantly Latino and African American communities.
Buying foreclosed houses "comes with a lot of risk factors," Wylie said. "There's no title insurance. We don't have a good idea of the extent of the defects" inside properties that have been sitting vacant or vandalized for months. Some houses come with delinquent property taxes, which Wylie's group typically must pay.
Then again, the profit opportunities can be significant as well. Most of the Wylie group's houses sell for more than 20% higher prices than Wylie paid at acquisition — a quick turnaround gain that potentially works for buyers, sellers, neighborhoods and, yes, the FHA itself.

Distributed by Washington Post Writers Group
Copyright © 2011, Los Angeles Times

Thursday, January 20, 2011

Don't let the media cloud your judgement

The beginning of the year always produces a flood of opinion on what the next 12 months will bring. Much of the opinion is simply an extrapolation on what was occurring in the closing months of the old year. Nevertheless, some of the prognostications are worth vetting just to get an idea of market sentiment.
RealtyTrac continues to forecast pessimism. Last year lenders filed a record 3.8 million foreclosures, and RealtyTrac doubts that the peak has been reached. In fact, it doesn't expect the trend to reverse until 2012. Resubmissions are one variable in RealtyTrac's cloudy outlook. The company expects as many as 250,000 foreclosures will be resubmitted this year because of the mortgage-servicing scandal that occurred in the fourth quarter of 2010. The continued foreclosure glut, according to RealtyTrac, will shave another 5 percent off average home prices this year.
A little perspective is in order: We need to consider that more than half the foreclosures last year originated in a handful of states – California, Florida, Arizona, Illinois, and Michigan. These select burgs have seen home prices plunge sharply, unemployment rise sharply, or a combination of the two. Nevertheless, real estate is local. Toss out the negative outliers and the data look a lot better. The problem is, too many borrowers and buyers focus on the national numbers, which tend to skew impressions of the local real estate market.

Hampton Roads market is healthy.  Selling or buying? Take advantage of the times and move.
Christine Parrish 757-816-7000 Your resource realtor. 
Serving Hampton Roads and OBX NC.

Take advantage of these low rates

The Fed meets next week... but you don't need to hear from the Fed to know that now is a great time to purchase a home. If you are thinking about selling, now is the time to be consulting with a real estate professional and develop marketing strategies  for selling your home.  

Free Comparative Market analysis, Free consultations about selling your home.
Call now to set up an appointment.  We are your resource in real estate.

Sunday, January 16, 2011

Spring is near and we are geared to sell your home

Rates are still low, and buyers are stirring.  Are you thinking about moving? Call Now for a free market analysis on your home.  

Need handy man work done on your home?  We have the resources that will help you get your house in shape.

Have a professional help you decide what your home needs before doing the improvements.  We can help you make good decisions and help set a goal to get your home ready for the market.  

I am ready to list your home. Call for a free consultation.
Christine Parrish
Va realtor, NC broker.(OBX)( Albarmarle)


Monday, January 10, 2011

Outer Banks Vacation in the Winter.

What is there to do after the holidays are over? How about taking a winter Outer Banks vacation? Everyone knows how great the Outer Banks are during the summer but only a few realize how much fun a winter Outer Banks Vacation can be.
The Outer Banks are a completely different experience in the winter. For one thing, there are no crowds. Instead, there are long stretches of sand with hardly a person to be seen, perfect for long walks. There are also lots of shells for the collector with hardly anyone collecting them. Instead of the sounds of other people, one hears the sounds of waves breaking, seagulls crying and wind whistling through the long grass. Another benefit of a winter vacation is that Outer Banks vacation lodging is generally less expensive than it is in the summer.
What is there to do besides walking on a nearly-empty beach then? There are plenty of attractions at the Outer Banks besides seaside walks. A few are visiting the lighthouses, going to the North Carolina Aquarium and surf fishing.
Cape Hatteras Lighthouse
The Cape Hatteras Lighthouse is perhaps the most famous lighthouse in America. This black and white striped lighthouse has been portrayed on postcards, calendars, books and television shows. Winter is a great time to visit the tallest lighthouse (208 feet) in the country because there are no crowds here either. It is closed for climbing in the winter but the museum and grounds are open all year long.
North Carolina Aquarium
Located on Roanoke Island, this aquarium is the largest in the state. It has a 285,000-gallon tank filled with hundreds of fish, sea turtles and sharks. There are also exhibit tanks filled with marine life such as eels, rays, sharks and different fish species. River Otters, turtles and alligators can be seen in the Wetlands Atrium.
Surf Fishing
Just because the water is too cold for people does not mean the fish are not biting. Surf fishing is a popular sport in the Outer Banks all year. There are several surf fishing schools, outfitters and guides located in the area who take surf fishing seriously and will be happy to get you started.
More good reasons for visiting the Outer Banks in winter include the many choices like, seeing the Wright Brothers Memorial, visiting the eclectic shops and trying some of the seafood restaurants. With a little imagination, you can have a great winter vacation in North Carolina!
To experience the real fun of winter the Outer Banks Vacation is the best. To make the vactaion perfect, you should choose the best Outer Banks Vacation.