The Market Shift Is Here. Are You Paying Attention?

By
Real Estate Broker/Owner with Tutas Towne Realty, Inc and Garden Views Realty, LLC BK607690

fannie mae


Good morning folks.


If you handle Short Sales as a negotiator then you are aware of all the recent difficulties with Short Sale Property Values coming from Fannie Mae. Here are some articles and discussions about what’s going on.


Fannie Mae Short Sale Property Evaluation Issues

Fannie Mae Short Sale Value Issues

Is Fannie Mae Trying To Control Property Values?


From the Fannie Mae Short Sale Servicer Guidelines.


  • Fannie Mae will now provide the servicer with list price guidance as well as a “good-through” date for the guidance. Servicers will have access to these values through eFannieMae.com. Servicers should provide the written (including email) list price guidance to the borrower and/or the borrower’s real estate broker with the following information: the suggested list price is provided only as guidance, and not as the required list price (the borrower and/or the borrower’s real estate broker are responsible for determining the list price); an offer at or above Fannie Mae’s suggested list price may not automatically result in an acceptable offer if the transaction costs are excessive;


Since the new Short Sale Guidelines from Fannie Mae and Freddie Mac went into effect 11/1/2012 Short Sales have become much more difficult. Kind of ironic since the Standard Short Sale was supposed to make Short Sales easier.


From Fannie Mae:


  • These new requirements implement and are consistent with the aligned policies described in Federal Housing Finance Agency's July 3, 2012 Directive to Fannie Mae and Freddie Mac to help simplify and streamline the short sale and deed-in-lieu of foreclosure processes


And just yesterday Fannie Mae and Freddie Mac sent out this:


1/18/2013

 

Fannie Mae and Freddie Mac announced changes to their servicing requirements for short sales. Please see below for some key changes that all parties involved in a short sale should be aware of. These changes apply to all Fannie Mae and Freddie Mac short sales; with an offer and without an offer.


  • Title Transfer requirement change:

    • The buyer is prohibited from selling the property for any sales price for a period of 30 days from the date of the deed.

    • After a 30 day period, and until 90 days from the date of the deed the buyer is further prohibited from selling the property for a sales price greater than 120% of the short sale price.

Note: The above restrictions will run with the land and are not personal to the grantee.


So what we now have are the 2 largest holders of mortgage loans in the US purposely inflating property values AND placing restrictions on property sales AFTER the property has already been sold. And just so you know the restrictions on selling are Deed Restrictions.


Team all of this with the lowest interest rates in history and, dare I say it, we are poised for another artificial increase in property values. Does all of this sound familiar?


Here’s what one analysis had to say in 2008.


  • Congress and the president have enacted legislation to put a potential bailout of those two organizations in statutory language, allowing the now-saved Fannie Mae and Freddie Mac to act as “saviors,” a strange position for two essentially bankrupt organizations that wholeheartedly helped engineer the financial calamity they are now supposed to fix. READ THE COMPLETE ANALYSIS


Folks, if you deal mostly in Short Sales as I do, then it is time to start shifting your business. Equity sellers and new construction are both on the upswing. In fact equity sellers have just recently claimed more than 50% of sales in the hardest hit markets.

There were also more construction starts than in any period since 2008 in December 2012.

  • January 17, 2013 - Solid gains in both single-family and multifamily housing production resulted in nationwide housing starts rising 12.1 percent to a seasonally adjusted annual rate of 954,000 units in December, according to newly released data from the U.S. Commerce Department. This is the highest level of new home production since June of 2008. READ THE FULL REPORT

Based on what’s happening in the market my plan for 2013 is to:

  1. Focus more on equity Sellers.

  2. Create additional income streams.

    1. Add agents

    2. Property Management

    3. Increase commission percentage

    4. Reduce expenses

  3. Market for more Buyers.

  4. Get more involved in the “Active Adult” Communities.

What are you going to do to start shifting your business?

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***I am NOT an Attorney nor do I play one on TV. Click the button below for my Bio.

The BIO for Bryant Tutas

 

 Tutas Towne Realty, Inc handles Florida real estate sales, Florida short sales, Florida strategic short sales, Florida pre-foreclosure sales, Florida foreclosures in Kissimmee Florida Short Sales, Davenport Florida Short Sales, Haines City Florida Short Sales, Poinciana Florida Short Sales, Solivita Florida Short Sales,  Orlando Florida Short Sales, Celebration Florida Short Sales, Windermere Florida Short Sales. Serving all of Polk, Osceola and Orange Counties Florida. Florida Short Sale Broker. Short Sale Florida.

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Gabe Sanders 01/20/2013 06:54 PM
Topic:
ActiveRain Community
Location:
Florida Orange County Orlando
Tags:
market shift
fannie mae

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Rainer
123,079
Lanise Warrior-Johnson
Real Estate Brokers Services, Inc. - Compton, CA
Real Estate Specialist

Bryan, the market is changing here in Long Beach also.  As home values increase there will be more standard sales.  It sounds like you have a great 2013 plan to respond to the changing market. 

Jan 18, 2013 11:46 PM #1
Rainmaker
1,315,185
Li Read
Sea to Sky Premier Properties (Salt Spring) - Salt Spring Island, BC
Caring expertise...knowledge for you!

Great reminder to us all to always be in the "now"...and the now says "change", loud and clear.   I like your clear 2013 plan, too.

Jan 19, 2013 01:16 AM #2
Rainmaker
440,644
Debbie Cook
Long & Foster Real Estate, Inc - Silver Spring, MD
Silver Spring and Takoma Park Maryland Real Estate

Good plan for 2013 - I think short sales are on their way OUT (Thanks) - they have been drastically reduced in my area in the last year.

Jan 19, 2013 01:43 AM #3
Rainmaker
863,796
Les & Sarah Oswald
Realty One Group - Eastvale, CA
Broker, Realtor and Investor

We are also seeing more standard sales with equity in the Inland Empire. Might shortsale be on the way out in 2013?

Jan 19, 2013 02:36 AM #4
Rainmaker
1,026,271
Rob Arnold
Sand Dollar Realty Group, Inc. - Altamonte Springs, FL
Metro Orlando Full Service - Investor Friendly & F

Good advice as usual.  Our office had several short sale Realtors that were closing multiple short sales every month.  They have all gotten away from those short sales - not only has the market shifted, but those short sales will burn you out after a while.  In Orange and Seminole, I run the numbers every month and about 50% of the sales are equity sellers and about 30% are short sales.  The market has definitely changed.  The next 3 months we have a listing contest going at the office.  Listings are definitely what works right now assuming you can actually get them to close.  Buyers seem to get so frustrated from missing out on deals but sellers end up getting multiple offers and the listing agent gets the sale.

Jan 19, 2013 03:37 AM #5
Rainmaker
4,797,528
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Unfortunately, we are going to see more foreclosures in FL if this trend keeps going.

Jan 19, 2013 08:13 PM #6
Rainmaker
108,711
Cathy McAlister
Cathy Ashley McAlister, GRI CDPE - Broker / Sacramento - Sacramento, CA
Sacramento DRE#00648507

Observed the writing on the wall over the last several months.  Our mix of closings changed dramatically from beginning to end of 2012.    Our equity sale mix has increased and we expect much more as inventory and prices edge up.    I have been primarily a short sale agent for nine years.  With these changes, we are no longer taking listings that "might have a chance" and only take what we believe is douable.     

On the plus side, I think the agents who have "dabbled" in short sales, will finally leave it to the dedicated short sale agents.

Jan 24, 2013 03:18 AM #7
Ambassador
3,017,076
Margaret Rome, Baltimore Maryland
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

Not only are you so good looking but you give great advice.

Mar 17, 2013 04:14 AM #8
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Rainmaker
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Bryant Tutas

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