Spacious upstairs unit in duplex + house on one lot, in Mulford Gardens area of San Leandro. This condo is close to San Leandro Marina. This property JUST SOLD for over the asking price! Antoine Pirson, Realtor®/Director Investment Properties at Caldecott Properties, represented the seller.
Is it possible there is a corrupted process at the very top (wall street executives, wall street investors, bank executives, hedge funds, etc.) Here is a thought: We know banks are not willing to reduce the principle loan amount for owners under water. That can easily be measured by the number of completed loan modification that include a principal reduction. Very (very) few: About 49,000 of all the proprietary modifications completed reduced both
the loan principal and monthly interest payments. Out of how many foreclosures again? About 1.2 mil? The ones that are done are merely to keep the politicians at bay so the banks can say they are following their guidelines.
But…….banks are very willing to foreclose on any property, and sell the properties in REO bulk at 55-60% of current market value. This allows rich “investors” to buy these properties, and then turn around and sell them back to the consumers market at 85% of value and make 20-25% of the investment in about 4 months. We are talking about $60 – 100 million REO investment per deal (read “tape”) . You and I cannot take advantage of these incredible returns, as we have no “insider” at the bank who will give us that opportunity. These opportunities go to “connections” so they can make a ton of money on foreclosed properties. Pretty easy money, no? Then here is this question: If banks are willing to write down the REO to 60% of value, then why can they not do a principal forgiveness for say 25% to the home owner? The write off to the bank is the same “loss” no? The big difference is that in the first scenario, the profit goes to the big investors at wall street. In the second scenario the “advantage” goes to the home owners.
So what would be the difference in the real estate market today (read values and prices), if we had used the second scenario? Well for sure there would be a lot less “distressed” properties. The home values would not have declined as much, which also means there would have been much less of a “recession” in real estate, and home owners would have felt very good about staying in their homes, so no strategic defaults, and thus a much “happier” consumer who might have been able to spend money on the economy.
When will we learn to do the right thing for all Americans?
Antoine E. Pirson, MBA, CCRM
Broker and Investment Consultant
Caldecott Properties
5251 Broadway, Oakland, CA 94618
Office: (510) 594 2400 x 234
www.investmentpropertyfirst.com
Fax: (510) 594 2424
Lic Nr: 01372814
Close to half of all condo sales in Oakland in 2010 utilized FHA backed loans. Though FHA guidelines have gotten a bit more conservative, most borrowers that meet FHA guidelines with credit scores above 680 qualify.
The loan limit for single family homes (including condominiums) in Alameda County, as of 6/7/2011, remains $729,750. In 2010, condominiums sold for an average of less than $300,000, so most condominiums qualify for FHA financing, right? Wrong.
It has become a bigger challenge for a condominium building to qualify for FHA financing than for the borrower to qualify due to the condo building approval process implemented by the FHA.
As of 5/23/2011, there were 42 condominium buildings in Oakland that are approved by the FHA. Here is a list of those buildings:
If you are interested in obtaining an FHA loan for a condo project that is not on th list, it is possible to get a condo building approved. I am happy to assist with this process. It requires, among other things, the approval of the home owner’s association.
If you are interested in purchasing a condo in the East Bay with an FHA loan or getting your building approved for FHA financing, please feel free to contact me to discuss.
We also have a good place for you to see what listings are available in most of these buildings: http://www.caldecott.com/?page=building_directory&buildings. If you don’t see a building here, drop me a line and I can assist you with more information.
Andy Read
Broker
Caldecott Properties
aread@caldecott.com
510.594.2400 x 222
I am sure we all have experience in selling or buying short sales and REO’s. Maybe in your neck of the woods, it is different, but here in California’s Bay Area, it seems that banks are not making the right decisions and are not capable of communicating between departments and are indeed preventing real estate values from stabilizing or appreciating. Here are two examples:
1. I was representing a buyer in short sale, and had an accepted offer from the seller and bank approval. Two before close of escrow, the bank foreclosed, and the property was bought at the county court house steps for $50,000 less than the accepted short sale offer (this is a loss even with the costs of the sale). This is an example of a lender’s inability to communicate between departments. Not only does this not make sense from a business / financial perspective, it also lowers the area prices by $50,000 on equivalent homes.
2. I was representing a buyer in a REO condo purchase. I had an accepted offer from the bank, and was going through the mortgage underwriting. The lender (for the buyer) decides NOT to do the loan, even after appraising the property at value, because the building does not meet a Fannie Mae guideline that was not designed for new construction. The original developer (whose name is on the Final Public Report issued by the California Department of Real Estate) still owns 40% of the total number of units. This resulted in the buyer walking away after spending $400 for appraisal and $400 for inspections. The condo unit sold for $75,000 less than the short sale offer. All the condo owners in this complex were negatively impacted by this sale which may result in these owners “strategically walking away” furthering the challenges faced in the current real estate environment.
You tell me the banks are NOT preventing real estate to rebound?
Antoine E. Pirson, MBA, CCRM, CCIM (candidate)
R.E. Broker and Investment Advisor
Caldecott Properties
5251 Broadway, Oakland, CA 94618
Office: (510) 594 2400 x 234
www.investmentpropertyfirst.com
Fax: (510) 594 2424
Lic Nr: 01372814
If you are close to losing your home or know someone who is, California has 4 NEW Housing Finance programs that can provide direct assistance to help prevent foreclosure.
Unemployment Mortgage Assistance Program (UMA) – Provides up to 6 months free mortgage payments for unemployed homeowners.
Mortgage Reinstatement Assistance Program (MRAP) – Provides up to $15,000 in mortgage payments for homeowners that have experienced a change in household circumstance which has led to default.
Principal Reduction Program (PRP) – Provides funding to homeowners whose homes are now worth less than their mortgage.
Transition Assistance Program (TAP) – Provides money for relocation costs in the event of a short sale or deed in lieu of foreclosure.
To find out if you or someone you know is eligible for one of these federally funded programs click here.
Where will the Housing Market go in 2011?
Tomorrow evening (January 4th, 2011) from 7 – 9 pm, Antoine Pirson (our Director of Investment Properties) will hold his regular monthly investment meet-up meeting at our Oakland office (5251 Broadway, Oakland, CA 94618 – the corner of Broadway and College Avenue)
Anyone who would like to join in the discussion is welcome to come and hear what Antoine and others have to say about the housing outlook for 2011.
Hope to see you there tomorrow night!
Antoine E. Pirson
MBA, CCRM, CCIM (candidate)
R.E. Broker and Investment Advisor
Lic #01372814
apirson@caldecott.com
Office: 510.594.2400 x 234
www.investmentpropertyfirst.com
Enter code FFP2010 for online purchases.
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Fannie Mae has launched KnowYourOptions.com™, a new consumer education Web site that outlines the choices available to homeowners who are struggling with their mortgage payments, and provides guidance on how they can contact and work with their mortgage company to find solutions.
The online resource, which offers reliable and easy-to-understand information in both English and Spanish, expands on Fannie Mae’s ongoing efforts to help struggling borrowers find alternatives to foreclosure. Key features of KnowYourOptions.com include:
KnowYourOptions.com provides homeowners who are having trouble paying or recognize they can no longer afford their mortgages with detailed information on
Check out KnowYourOptions.com today!
Yes, there are distressed properties in Lafayette, Moraga and Orinda, just not many compared to other cities in Alameda and Contra Costa that were hit significantly harder by the market downturn.
From January 1, 2010 to May 7, 2010, there were 28 distressed sales in Lamorinda accounting for 17.7% of total sales in these cities. In addition, there were another 26 sales pending as of May 7, 2010. Of these 28 sales, 10 were short sales, and 18 were REO’s. These properties were listed for an average of $669,949 ($306/square foot) and sold for an average of $642,402 ($295/square foot) – a 4.1% average discount on the list price.
During the same period of January 1, 2010 to May 7, 2010, there were 130 non-distressed sales (re-sales and new construction) that were listed for an average of $1,017,907 ($427/square foot) and sold for an average of $966,636 ($409/square foot) – a 5.0% discount on the list price.
Based on this data, distressed properties are selling for an average discount of 30.7% versus non-distressed real estate sales.
For more information about this market, or to sign up for a free-list of distressed sales in Lafayette, Moraga, Orinda or other Contra Costa or Alameda County cities, please contact Andy Read, Broker, at 510.594.2400 x 222 or aread@Caldecott.com.
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East Bay Real Estate: Caldecott Properties 