Ada property values have bottomed out.

The Ada County assessor is stating that values have bottomed out, and in addition to that they have begun to climb again this year.

From the Idaho Stateman

Assessor says values have dropped a third since the 2008 peak

After three years of double-digit declines, Ada County property values leveled out in 2011, with a decline of just 1.7 percent last year.

Ada County Assessor Bob McQuade said real estate is now beginning a slow climb out. Hitting rock bottom entailed a 33 percent decline in assessed property values in just four years.

The median assessed value of an Ada County home peaked in 2008 at $208,100. This year, that number is $138,800.

Assessments mailed in recent weeks are for property values as of Jan. 1, 2012.

In Canyon County, the trend of dwindling property values continued, dropping about 8 percent countywide from 2010 levels, Chief Deputy Assessor Joe Cox said. That’s slightly less than the 8.5 percent drop reported from 2009 to 2010.

CHANGES BY AREA

The changes in home values over the past year ranged from a 5.9 percent decrease in Southeast Boise to a 1.3 percent increase in Northwest Meridian. Eleven of 17 Ada survey areas saw declines, and five — South, Southwest and East Boise, northeast Meridian and Star — recorded no change in value. Just two areas recorded an increase, both in Meridian.

Some of the grimmest news came from Caldwell, where property values dropped by 11 percent in 2011, Cox said. In Nampa, the decline was about 9 percent.

ASSESSMENTS AND TAXES

Lower property values do not necessarily translate into lower taxes.

For example, on one Southeast Boise home, the assessed value has declined 28 percent from 2008 to 2012, but property taxes increased 4 percent over the same period.

That’s because, ultimately, property tax bills are determined by the levy rates set by individual taxing districts where a home is located. When property values drop, these districts can increase rates to keep the same level of revenue.

There are 41 taxing districts in Ada County, including the county, cities, schools, emergency medical services, and library, cemetery, mosquito abatement and irrigation districts. These taxing districts will set their respective budgets and levy rates in September. Each can raise budgets by 3 percent, plus a percentage for new construction.

Another factor affecting a home’s taxable value is the homeowner’s exemption, which is based on the federal housing price index. This year the maximum exemption is $83,974, down from $92,040 last year. It was highest in 2009 at $104,500.

Throughout Canyon County, properties that lost the most value were those built in 1975 or earlier, Cox said. Market interest has focused on three-bedroom homes less than a decade old, which often are sparking a bidding war.

Much of the drop in Canyon County values is represented by homes that were foreclosed on, he said.

Read more here: http://www.idahostatesman.com/2012/06/18/2159176/ada-property-values-have-bottomed.html#storylink=cpy

 

 

Canyon County-Real Estate Briefs

CANYON COUNTY HOUSING MARKET STATS

54: Percentage of homes sold in Canyon County in April that were distressed, down from 75 percent a year prior.

33: Percentage of homes sold in Ada County in April that were distressed, down from 57 percent a year prior.

3: Months of home inventory in Canyon County — considered by some to be a shortage.

- Information provided by Lisa Bain with TitleOne Corporation

HOUSING MARKET AT A GLANCE

Information for Q1 2012, based on single-family homes:

$69,999 AND UNDER: Most common price range of homes sold (31.3 percent of sales)

639: Number of homes sold, 49 of which were newly constructed

176: Number of homes sold in South Nampa, highest volume of sales in Canyon County. Six were new.

- Information provided by Intermountain MLS through Zions Banks.

 

Canyon County-Fewer Bank Owned

CANYON COUNTY — If you were house hunting in Canyon County last year, about 65 percent of your options would have been foreclosed homes, Brian Stender, an appraiser with the Canyon County Assessor’s office, said.

Now that number is probably closer to 25 or 30 percent, Pioneer Title Co. CEO Tim Bundgard said.

It’s hard to predict how much shadow inventory banks are holding back, but Bundgard doesn’t foresee another flood of distressed properties hitting the market.

“I think (banks) are more cautious and they’re taking their time to process so they don’t knock the values down,” he said.

In May, there were about 30 REOs, or bank owned homes, on the Treasure Valley market, he said, compared to about 250 a year ago.

Because there are less foreclosed homes for sale, they’re not pulling prices down like they used to.

Sale prices in many segments of the market, including distressed properties, are on the rise, especially within the last 90 days.

The average selling price of homes in Canyon County was $104,756 in April, up from $96,849 in July, Pioneer Title data shows.

Who maintains foreclosed homes?

Encouraging housing market news doesn’t make things better for the homeowner living next to a deteriorating vacant house overrun with weeds.

Private and government lending institutions can contract with an agent to maintain foreclosed property.

“We go in and we clean them up, and we have someone that goes out every two weeks and maintains the lawn,” said Julie Sundquist, an associate broker with Coldwell Banker in Nampa who works on Fannie Mae properties. “... One could be in fabulous condition and it doesn’t need a thing, and another could be totally trashed.”

But most lending institutions don’t invest a lot of money in making repairs. Rather, the properties are “broom swept” or tidied up, real estate agent Patti Syme said.

If the home is vacant but not quite through the foreclosure process, it’s likely no one is maintaining it, Sundquist said, because lending contracts don’t allow for it.

Foreclosed homes still an attractive option

Most foreclosed homes in the county are in relatively good condition, Marce Barrera, founder of Homes Online Realty, said.

Foreclosed homes are seeing multiple offers and spending less time on the market.

“Interest rates are low and this is a great time to buy a house at a really discounted value,” Bundgard said.

Interest rates, which can fluctuate daily, are around 3.75 percent for a 30-year conventional mortgage, compared to 3.875 six months ago and 4.625 a year ago, Zions Bank spokeswoman Nicola McIntosh said.

What’s next?

As notices of default increase, real estate professionals expect to see more foreclosed homes on the market soon — just not a flood of them like in previous years.

With pent-up demand, these homes will probably be easily absorbed, Barrera said.

Canyon County will also see more new homes, as building permits have doubled in the last year, Pioneer Title Co. data shows. Currently, new construction makes up about 18 percent of the housing market.

Courtesy Idaho Press Tribune

 

Which is Better:A Rental or Own Home?

Knight is Shining Armor or A Wolf in Sheep's Clothing?

I just read this article and I am not sure what to think. The U.S. Housing secretary is making it sound like it is the best thing since sliced bread but I am not convinced. Someone is going to make a lot of money on this deal but I doubt the homeowners are going to be the ones to benefit.

"The Federal Housing Administration announced it will begin selling off distressed mortgages in bulk, which may help prevent foreclosures for thousands of home owners. Beginning in September, FHA says it hopes to sell 5,000 mortgages each quarter.

The move will also help the FHA get rid of some of the 700,000 or so seriously delinquent mortgages that it holds. Many of those delinquent loans originated from 2007 and 2009, the height of the housing crisis.

Housing Secretary Shaun Donovan says there may be a greater opportunity for investors to buy the troubled loans and either reduce the principal on the loans or offer rent-to-own plans, thereby keeping more home owners in their homes."

Home owners whose loans are sold might one day get a call from someone saying “‘Hey, we’re willing to cut your payment dramatically, or cut the balance on your loan dramatically,” Donovan said. “There are going to be a set of options that might arrive on that doorstep as the best news that home owner has ever heard.”

 

Ada County Real Estate Market Report in Pictures

Yesterday I gave you May's Ada County Market report courtesy of Marc Lebowitz of the Ada County Association of Realtors. Today I am sending along the report in pictures!

Is the sales slowdown coming?    Median price is the strongest since 2009!    Median back above 2,000 but still less than 4 month's supply.    Pretty clear picture of cause and effect.    What a difference a year makes!

 

May sales slow way down as median prices jump…is this the start of a new trend?

by marclebowitz Sales in May 2012 were 604 in Ada County, an increase of 1% compared to May 2011.   Year-to-date sales are 2,632; 9% over the first four months of 2011. Dollar volume for May was up 24%! New homes sold in May increased 100% over new homes sold in May of 2011!!…and are up 65% YTD. Historically, May sales outpace April by an average of 2% or less.  May 2012 sales decreased by 6% compared to April 2012. Of our total sales in May… 30% were distressed….down 5% from April 2012. In May 2011, 53% of our sales were distressed.  In January 56% of distressed properties were REOs and 44% were short sales.  In May the ratio was 61% short sales and 39% REOs. This is two consecutive months with short sales being the larger percentage of distressed properties sold. Whether this is a short term effect or a real indication that we are clearing out the “shadow inventory” remains to be seen in coming months. Pending sales at the end of May were 1,253; an increase of 4.8% from the end of April. In general pending sales in May are the highest of the year.  The percentage of pending sales in distress decreased 3% from April, totaling 28% overall. This is the lowest number we’ve seen in several years. We were averaging close to 50% of pendings in distress over that last five months; but have decreased steadily since January.  Of Pending sales in distress, short sales outnumbered REO’s 2 to 1. At the end of May, we had 25% more sales pending than at the end of May 2011. Hold on to your hat…May median home price was $179,900; up 25% from May 2011; and up 14% from March 2012. Median home price is up 30% since January of this year and above $150,000 for four months running. The last time we saw a median price this strong was in early 2009 (when we passed it going in the wrong direction). New Homes median price for May was $227,000; an increase of 4.5% from May 2011. The number of houses available increased slightly for the second consecutive month. At the end of May our total active inventory was 2,043 homes. This is up 2% from April and 23% less than last year at this time.  Possibly the increase in median price is enabling some real move up buyer activity. At the same time, the percentage of distressed active inventory dipped 3% to 27%. This is the lowest number we’ve seen in several years. We have been hovering between 33% and 36% for the last year. We remain well below the 40% levels set last spring….when we were on the increase. Of our Distressed Inventory 92% is Short Sales and only 8% is REO. The price point with the largest increase in available properties is $200,000 to $250,000 which added 25 units in May. In Ada County we now have less than 3.3 months of inventory on hand. The price category in shortest supply is <$119,000 with 1.7 months. In the range of $120,000 to $159,999 we have 2.6 months. All price points up to $250,000 have less than 4 month’s supply. We have benefited for nearly two years from inventory levels much lower than national average. Multiple offers are much more prevalent; now becoming the norm. Based on May sold data, our most desirable price point is $120,000 to $200,000 which increased by 20% from March; The next largest price point sold is <$120,000 at 18% of all sales; down 8% from last month.  The biggest increase was in sales between $200,000 and $250,000; which were up 300% from January 2012. Comparing Sales to Inventory, for key price points… @<$120,000 we sold 43% of all that we had in May; for $120,000 to $160,000 we sold 36% of all that was available; for $160,0000 to $200,000 we sold 34% of the total available. The question I was asked last week sums up what most of us are thinking: “How long can we continue to improve at this pace?”  I’ll let you know next month.

 

Would you buy a Foreclosure Home in Idaho?

My experience has shown the most buyers in Idaho are certainly willing to look at bank foreclosures. Many have been reluctant to consider short sales with all the time involvement and uncertainties involved with them.

REO Stigma Fades for Home Buyers, Survey Shows

DAILY REAL ESTATE NEWS

The number of home buyers who say they are interested in purchasing a foreclosure has nearly tripled in the last two-and-a-half years, according to a new survey by Realtor.com. What’s more, 92 percent of those buyers say they would use the foreclosures as their primary residence rather than using them as investments.

"We see a combination of factors coming into play explaining the unexpected interest in foreclosures," says Steve Berkowitz, chief executive officer of Realtor.com. "Reductions in supply, expectations that home prices will rise, and changing attitudes toward foreclosures are contributing to the increased demand, especially among owner-occupants. As lenders begin processing their distressed inventories and releasing them for sale at the local level, we look to them to move carefully and monitor conditions so recently gained home values aren't diminished."

Nearly 65 percent of buyers say they’re likely to buy a foreclosure today compared to 25 percent who said that in October 2009, according to the Realtor.com survey.

Many of these potential buyers say they expect a 10 percent to 30 percent discount when buying a foreclosed property, according to the survey.

They also see greater potential for appreciation with a foreclosure purchase. Fifty-six percent of the possible foreclosure buyers surveyed said they expect their foreclosure purchase to appreciate about 10 percent within the next five years—or about 2 percent a year, according to the Realtor.com survey.

"Foreclosures can present a new opportunity for buyers to become home owners, especially considering the discounted purchase prices and lower down payment requirements,” says Errol Samuelson, Realtor.com’s president. “This is especially true for owner-occupants interested in improving the property, and holding to it long enough to realize appreciation that can be carried over to future home purchases.”

 

Census Findings-New Single Family Residential

New Single Family Homes: 2011 vs 2006 The Census Bureau just released their findings on new single family residential construction built in 2011. Here is a table comparing  last year to 2006:

 

 

April's Ada and Canyon Counties PTC Index

The PTC Index utilizes a proprietary algorithm that weighs nine key real estate variables. These variables, though widely available, have not been easily collected in a single location. The PTC Index changes that.

April 2012

Building Permits	238
New Home Sales	135
Existing Home Sales	772
Refinance	1224
Average Sales Price	146342
Financial-Bond Market(10-yr Treasury)	2.05
Days on Market	76
Distressed(Short Sales and REO)	2673
Notices of Default	455
PTC Index	192

April continues to show encouraging signs of recovery in the real estate market with gains in most areas of the Index. Building permits are up nearly 31% from March 2012 with 238 permits filed between Ada and Canyon Counties – up over 93% when compared to this time in 2011! New home sales showed great gains up 25% from the month prior and existing home sales followed suit with gains of 20%. Short sales decreased 3% with 1,731 listed in the month of April. REOs were also down just over 3% from March at 942 for a grand total of 2,673 distressed listings. Notices of Default showed significant increases, most notably in Canyon County, up 31% from March.

For reference, March was at 162.  Also to give you some perspective, when the market was at its most active point in 2005, the PTC Index average would have been 225. In January of 2010 we reached a low of 28.

My thanks to Pioneer Title Company!

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A Home and the American Dream

This blog often discusses the data behind the housing market. Today, we want to address the emotion behind the market comeback; a belief in homeownership which is still alive and well in this country.

A study conducted by Coldwell Banker and psychotherapist Dr. Robi Ludwig found that owning a home is still very much a goal for many Americans. In the study, 91 percent of those surveyed said owning a home is part of the American Dream. A second study by TD Bank, reported similar results:

• More than half of consumers polled say homeownership is a vital component to defining the American Dream


• 59 percent associated feelings of excitement or pride as part of their first time home buying process


• 84% of today’s younger renting generation-ages 18-34-intend to buy a home

This belief in homeownership is a major reason Americans are again buying homes. As Dr. Ludwig explains:

“Now that we’re picking up the pieces, we’re seeing a psychological shift. Instead of looking at homes through the eyes of an economist, we’re realizing that a home doesn’t solely equate to financial return or measure only to a mortgage amount. Instead the home is the emotional center of our lives, and it remains a critical component of who we are…

The feeling you get when you step through your front door or pull into your driveway is indescribable and priceless and the same holds true for our children who crave stability. While I know that financial hardships during the recession clearly have impacted many households, it is clear that the emotional value of a home is still strongly recognized.”

 

Idaho's Foreclosure Inventory

Here is a national graphic comparing foreclosure inventories by state, Idaho is reported at between 2-3%.



*as a percentage of all mortgaged homes

 

Watch Out, We Are Drowning!

Nearly 16M Homes Are Now Underwater

Zillow just reported that their data shows nearly 16 million homes in this country are now in a negative equity position where the house is worth less than the mortgages on the home. This number is dramatically higher than the approximate 11 million reported by other entities. Why the huge difference? Zillow professes to take into consideration ALL loans on the property not just the most recent loan (purchase or refinance).

The key findings in the study:

• Nearly one-third (31.4 percent) of U.S. homeowners with mortgages – or 15.7 million – were underwater on their mortgage.


• A slower pace of foreclosures after the robo-signing issues of 2010 contributed to slower progress in working down negative equity. Foreclosures cause homes to come out of negative equity when a bank or third party takes ownership.


• Nine in 10 homeowners continue to make their mortgage and home loan payments on time, with just 10.1 percent of underwater homeowners more than 90 days delinquent.


• Nearly 40 percent of underwater homeowners, or 12.4 percent of all homeowners with a mortgage, owe between 1 and 20 percent more than their home is worth.


• An additional 21 percent of underwater homeowners, or 6.6 percent of all homeowners with a mortgage, owe between 21 and 40 percent more than their home is worth.


• About 2.4 million, or 4.7 percent of all homeowners with mortgages owe more than double what their home is worth.

How can negative equity impact the housing market? In the report, Zillow Chief Economist Stan Humphries explains:

“Not only does negative equity tie many to their homes, by making homeowners unable to move when they may want to, but if economic growth slows and unemployment rises, more homeowners will be unable to make timely mortgage payments, increasing delinquency rates and eventually foreclosures.”