Foreclosures Grow in Mortgage Market’s Top Tiers
December 10th, 2009 by adminNew data suggest that foreclosures are rising in more expensive housing markets. About 30% of foreclosures in June involved homes in the top third of local housing values, up from 16% when the foreclosure crisis began three years ago, according to new information from real-estate Web site Zillow.com. The bottom one-third of housing markets, by home value, now account for 35% of foreclosures, down from 55% in 2006. The report shows that foreclosures, after dying earlier this year, began to accelerate in the late spring and that more expensive homes have more recently accounted for a growing share of all foreclosures. “The slope of that curve in recent months is much sharper than it was recently,” said Stan Humphries, chief economist for Zillow. Rising foreclosures among more-expensive homes could create added pressure for a housing market that has shown signs of stabilizing in recent months as sales of lower-priced homes pick up. The Zillow research compared homes against the median values for their local market and broke each market into three tiers by value. Zillow then looked at the share of monthly foreclosures in each tier over the past decade. Foreclosures are rising in more expensive markets as home values in those areas fall, leaving more homeowners with mortgages that exceed the value of their properties.
Prime loans accounted for 58% of foreclosure starts in the second quarter, up from 44% endure year, according to the Mortgage Bankers Association. Subprime mortgages accounted for one-third of foreclosure starts, down from one-half last year. The prime classification includes so-called exotic mortgages that were increasingly derived to buy more expensive homes, including interest-only mortgages that allowed borrowers to defer principal payments during an dawning period. Borrowers often aren’t able to refinance out of these products because the drop in household values has departed them with little equity in their homes. Default rates are particularly high and expected to rise on option adjustable-rate mortgages, which allow borrowers to dig out minimum payments that may not cover the interest due. Monthly payments can grow to sharply higher levels after five years or when the outstanding balance reaches a definite level. A study by Fitch Ratings discovered that 46% of option ARMs were 30 days past due last month, even though just 12% of such loans have reset to higher monthly payments. Zillow estimated that nearly one in four homes with mortgages was desirability less than the value of the home at the end of June. Mr. Humphries said he didn’t expect to view foreclosure volumes level off until later in 2010.
Foreclosures Grow in Mortgage Market’s Top Tiers
December 8th, 2009 by adminNew data suggest that foreclosures are rising in more expensive housing markets. About 30% of foreclosures in June involved homes in the top third of local housing values, up from 16% when the foreclosure crisis began three years ago, according to new information from real-estate Web site Zillow.com. The bottom one-third of housing markets, by home value, now account for 35% of foreclosures, down from 55% in 2006. The report shows that foreclosures, after dying earlier this year, began to accelerate in the late spring and that more expensive homes have more recently accounted for a growing share of all foreclosures. “The slope of that curve in recent months is much sharper than it was recently,” said Stan Humphries, chief economist for Zillow. Rising foreclosures among more-expensive homes could create added pressure for a housing market that has shown signs of stabilizing in recent months as sales of lower-priced homes pick up. The Zillow research compared homes against the median values for their local market and broke each market into three tiers by value. Zillow then looked at the share of monthly foreclosures in each tier over the past decade. Foreclosures are rising in more expensive markets as home values in those areas fall, leaving more homeowners with mortgages that exceed the value of their properties.
Prime loans accounted for 58% of foreclosure starts in the second quarter, up from 44% endure year, according to the Mortgage Bankers Association. Subprime mortgages accounted for one-third of foreclosure starts, down from one-half last year. The prime classification includes so-called exotic mortgages that were increasingly derived to buy more expensive homes, including interest-only mortgages that allowed borrowers to defer principal payments during an dawning period. Borrowers often aren’t able to refinance out of these products because the drop in household values has departed them with little equity in their homes. Default rates are particularly high and expected to rise on option adjustable-rate mortgages, which allow borrowers to dig out minimum payments that may not cover the interest due. Monthly payments can grow to sharply higher levels after five years or when the outstanding balance reaches a definite level. A study by Fitch Ratings discovered that 46% of option ARMs were 30 days past due last month, even though just 12% of such loans have reset to higher monthly payments. Zillow estimated that nearly one in four homes with mortgages was desirability less than the value of the home at the end of June. Mr. Humphries said he didn’t expect to view foreclosure volumes level off until later in 2010.
Foreclosures Grow in Mortgage Market’s Top Tiers
December 7th, 2009 by adminNew data suggest that foreclosures are rising in more expensive housing markets. About 30% of foreclosures in June involved homes in the top third of local housing values, up from 16% when the foreclosure crisis began three years ago, according to new information from real-estate Web site Zillow.com. The bottom one-third of housing markets, by home value, now account for 35% of foreclosures, down from 55% in 2006. The report shows that foreclosures, after dying earlier this year, began to accelerate in the late spring and that more expensive homes have more recently accounted for a growing share of all foreclosures. “The slope of that curve in recent months is much sharper than it was recently,” said Stan Humphries, chief economist for Zillow. Rising foreclosures among more-expensive homes could create added pressure for a housing market that has shown signs of stabilizing in recent months as sales of lower-priced homes pick up. The Zillow research compared homes against the median values for their local market and broke each market into three tiers by value. Zillow then looked at the share of monthly foreclosures in each tier over the past decade. Foreclosures are rising in more expensive markets as home values in those areas fall, leaving more homeowners with mortgages that exceed the value of their properties.
Prime loans accounted for 58% of foreclosure starts in the second quarter, up from 44% endure year, according to the Mortgage Bankers Association. Subprime mortgages accounted for one-third of foreclosure starts, down from one-half last year. The prime classification includes so-called exotic mortgages that were increasingly derived to buy more expensive homes, including interest-only mortgages that allowed borrowers to defer principal payments during an dawning period. Borrowers often aren’t able to refinance out of these products because the drop in household values has departed them with little equity in their homes. Default rates are particularly high and expected to rise on option adjustable-rate mortgages, which allow borrowers to dig out minimum payments that may not cover the interest due. Monthly payments can grow to sharply higher levels after five years or when the outstanding balance reaches a definite level. A study by Fitch Ratings discovered that 46% of option ARMs were 30 days past due last month, even though just 12% of such loans have reset to higher monthly payments. Zillow estimated that nearly one in four homes with mortgages was desirability less than the value of the home at the end of June. Mr. Humphries said he didn’t expect to view foreclosure volumes level off until later in 2010.
Role Of Real Estate Agent In Vacation And Second Home Markets
October 23rd, 2009 by adminSecond home sales have been increasing over the last few years with more people becoming second home owners. In 2005 alone, 40 percent of the homes sold were second homes. Demographics, all time low mortgage rates, and healthy rise in home prices have contributed to this development in the second home market. Besides these, a major factor that has helped augment the buying and selling of second homes is the real estate professional.
The National Association of Realtors conducted research on the profile of second-home owners in 2006. According to the NAR report entitled ‘2006 Profile of Second-Home Owners’, a majority of second home sales transactions are conducted using the services of real estate agents.
The statistics are remarkable; 64 % of vacation home buyers purchased their home using the services of a real estate agent by the end of 2005 – a marked increase from less than 50 % of vacation-home buyers in 2003. Also, 65 % of investment-home buyers purchased their home with the help of a real estate agent – an increase from 53 % of pre-2003. In comparison, only 14 % of vacation-home buyers and 7 % of investment-home buyers purchased directly from builders from 2003 to 2005.
The growing role of the real estate professional is evident from the following figures:
1. Of vacation home sales made, 71 % of them were second homes and 74 % of the sales were made using the services of a real estate agent.
2. Of the investment properties sold, 85 % of them were previously owned and 62 % of the sales were made using the services of a real estate agent.
The use of real estate agents in second home sales transactions varied according to the home’ location.
1. Buyers used a real estate agent more frequently while purchasing a vacation home located in a suburb/subdivision (56 %) or a rural area (57 %) than for homes in other locations.
2. About 66 % of buyers who purchased an investment property in an urban/central city area or in a suburb/subdivision, used the services of a real estate agent more frequently than those who purchased a home in other locations.
Real estate professionals continue to be the first source of information to second-home buyers (38 % of vacation-home buyers and 34 % of investment-home buyers). The real estate professional also plays a major role when second-home owners plan to buy additional properties. If you are thinking of buying a second home or vacation home, seek out the services of a real estate agent to guide you through your next home purchase.
1. The percentage of second home owners who are more likely to use a real estate agent in their next home purchase is quite high. Among vacation-home owners it is 79 % and investment-home owners 73 %.
2. Among second home owners, 65 % of vacation-home owners and 64% of investment-property owners are more likely to use a real estate agent in their next home sales.
Given these statistics, it is no wonder that the real estate agent plays a pivotal role in helping people buy and sell second homes. So whether you are a second-home buyer or seller, enlist the services of an agent for a smooth, hassle free real estate transaction.
