The tale of the Trojan Horse recounts the story of a huge wooden horse constructed by the Greeks in order to lull the Trojans into a false sense of security. Inside this wooden horse were hidden Greek warriors, and as the Greek army pretended to sail away from the city of Troy after a ten-year war, the supposedly victorious Trojans pulled the Horse into their city to celebrate their victory. But that night, the soldiers inside the Horse crept out of hiding, opened the gates to the city of Troy allowing the Greek army to enter and destroy the city. Guess what. The Trojan Horse is back, only this time it comes disguised as the real estate short sale.

Short Sales are the trojan horse threatening the destruction of the housing market. I never thought that I would come to that conclusion but a look at the statistics are both shocking and revealing regarding short sales and what they’ve done to the housing market here in my home town of Grants Pass. Our local market area has currently a total of 1240 properties that were listed in the month of June, 2010. During that 30 day period we sold 84 properties, we had another 84 go pending, and 34 more became contingent sales. That’s not bad but by no means good. The amazing part is that short sales represented 10% of the total inventory for sale and yet out of over 100 properties that were listed as short sales, there were only 4 that actually sold. That’s a mere 3/10 of 1% of the total activity in the market. Sadly, short sales are influencing the price of all the other properties in the market, contaminating everything around them because short sellers have no stake in the outcome of the sale.

Let me explain. Continue reading Short Sales and the Trojan Horse

There is good news and bad news for the southern Oregon housing market. First, the good news: Sales volume and prices are up slightly to moderately and days-on-market and number-of-homes for sale are down. All this bodes well for a continuing recovery. Business was fairly brisk for home sales in Grants Pass and the Southern Oregon real estate market in general, and the months of March and April were very good as buyers scrambled to take advantage of the expiration of the home buyers tax credit that ended on April 30th. We had until June 30th to close those contracts and the last week of June we were very busy with closings. The house and senate both passed an extension of time to complete closings for those sales that were hung up and couldn’t meet the June 30th deadline. President Obama is expected to sign it. That’s good because I had a number of sales that were supposed to meet that deadline and couldn’t.

Speaking of short sales, Continue reading Southern Oregon Real Estate Market Update

Homeowners distressed by the housing sector meltdown in the Southern Oregon real estate market can look forward to help from the U.S. Treasury Department in the upcoming months. Last week the Treasury Department unveiled new rules for homeowners nationwide who need to sell but are “underwater” and unable to get a price for their home that would cover the amount owed to their lender. The Treasury Department plan has been created to help those who either don’t have enough income or whose debt levels are too high to allow them to qualify for a loan modification under the multi-billion dollar program known as Making Home Affordable.

When a home in the Southern Oregon real estate market is listed for a price below what is owed to the lender, it falls into the category of a Short Sale, but make no mistakes about it, there is nothing short about it, except for the funds necessary to pay off the loan. However, there are advantages to a short sale; in addition to saving the seller’s credit, short sales save the banks the expense of foreclosure. Short sales also help to solidify neighborhood property valuations because a short sale price is most likely a higher price than what the house will sell for through foreclosure. It is estimated that in 2009, one out of every ten home sales was a short sale, and in some distressed areas like Las Vegas and Sacrament, the ratio is much higher.

Following are the guidelines for qualification for the new Treasury Department assistance: Continue reading Treasury Department Assistance for Short Sales in the Southern Oregon Real Estate Market

Oh, if only the problems of the world could be solved with the writing of a single blog. But we all know better; most problems are easy to identify but tough to solve. Short sales in the Southern Oregon Real estate market are no different, and despite my own self-imposed skepticism, I will point out some obvious problems with the short sale process and suggest a simple way to streamline the procedure.

A short sale occurs when a homeowner attempts to sell his home for a price that is less than what is owed on the mortgage. It is incumbent upon the seller to inform the bank of the their intentions to sell for a reduced price, but simply informing the bank is no guarantee of lender cooperation. Often the short sale is additionally complicated by 2nd and 3rd mortgages that are attached to the deed and must be removed before the deed can be transferred to another owner. Nevertheless, the mortgage holder in the first position has Continue reading Short Sales and the Southern Oregon Real Estate Market, Part II

So what’s wrong with the Southern Oregon real estate market and what can we do to fix it? Recently, the stock market rallied to 10,000 only to dip back down and regress due to a loss of confidence for a sustainable economic recovery over a lot of things, from unemployment to inflation. Meanwhile, the stability of the Housing Sector may have strengthened, but only incrementally. The overall road to recovery for the Housing Sector continues to be road-blocked by foreclosures and short sales.

Like communities nationwide, the Southern Oregon real estate market is undergoing a profound increase in the overall numbers of Continue reading Foreclosures, Short Sales, and the Southern Oregon Real Estate Market – Part I