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!

A Rare Opportunity- Membership in Idaho's Best Kept Secret

I just listed a cabin in Karney Lakes Club, with purchase of the cabin you obtain membership in the club, established in 1928, which owns 400 acres of mountain splendor, 2 small lakes, water rights and exclusive seclusion with only 29 members.  Most of these cabins/membership are passed down from generation to generation.

Located only 50 minutes to Boise towards the end of Robie Creek road, borders National Forest land and it makes for that perfect week-end getaway. Full time caretakers provide year around security for this gated retreat.

The cabin has been well maintained and updated and comes completely furnished. Just brings yourselves and your clothes and enjoy!  Priced at only $119,000, for more information please go to lowesflatfee.com.

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.”