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Realtors to open listings to online brokers

From Reuters:

The National Association of Realtors will open its vast listing of homes for
sale to cheaper, Internet-based brokers in an agreement to settle a federal
lawsuit, the government said in a statement on Tuesday.

The change could save those who buy or sell a home thousands of dollars since commissions could drop as much as 1 percent of the selling price, said Deborah Garza, the deputy assistant attorney general for antitrust, in a telephone briefing with reporters.

The settlement will lead to "more choice, better service and lower commission rates," Garza added.

Essentially the deal requires the 800 multiple listings services associated with the National Association of Realtors for various local markets to give access to Internet-based competitors, the government said.

This is a great thing for real estate investors who have been looking to use the MLS services to sell their homes, but have not wanted to pay a full real estate commission to do it.

We’ve seen it happen in other businesses: once the internet gets a toehold in a commissioned industry, prices for the consumer tend to plummet. Look at the rates consumers pay to book travel or buy and sell stocks; each has dropped dramatically as the internet has become a more popular way to book trips or invest.

More and more business is conducted online, and the first place most potential purchasers go to look for a new home is the internet. By opening up the MLS listings to online brokers, we can expect greater innovation which will just benefit the real estate investor. That is, by making the purchasing process cheaper and more simple for that potential buyer, investors stand to gain.

How long before we see realestate.google.com? You be the judge.

Photo: Computer city #1: Downtown, originally uploaded by Rune T.

Banks miss an easy housing fix

From CNN:

Banks say they want to help troubled homeowners, but they are delaying deals
that could save everyone - including the lenders themselves - a lot of time and
money.

Lenders are taking much longer than necessary to approve short sales,
according to Duane LeGate, of House Buyers Network, a short sale specialist.
In a short sale, a homeowner who cannot keep up with their loan asks the
lender to take a dollar amount less than what is owed on a home's mortgage, and
forgive the remainder of the unpaid debt.

So if a borrower has a mortgage balance of $100,000 and finds a buyer who will pay $95,000 for the house, the lender agrees to accept that $95,000 and close out the loan.

"There was a much greater chance of success with these in the past," said LeGate

Ideally in a short sale, everyone wins. Borrowers avoid the ugly foreclosure process
that destroys their credit, while lenders recoup more of their costs than they
would by spending the time and money it takes to kick an owner out and resell
the property.

The CNN article is worth a read, and it discusses a number of problems that sellers, investors, and agents are having as they try and get short sales approved in today’s housing market.

In our experience as closing attorneys who work with investors, the entire short sale experience differs greatly from lender to lender, and there are few industry-wide standards that can be applied when negotiating a short sale. Some lenders require that their borrower be down a payment before talking short sales. Others don’t. Some are very responsive and work quickly to get potential short sales approved. Others drag their feet. Overall, it is impossible to paint with broad strokes the attitude of the mortgage lenders toward short sales, just because individual lenders approach them very differently.

To be fair, though: the recent rise in the number of short sale requests is unprecedented, and frankly something the mortgage industry was not prepared for. While years ago a lender might have a very few individual short sale loss mitigators, today they’ve had to create entire departments, with all of the policies, procedures, and bureaucracy that entails.

Still, with home prices continuing to fall and an increasing number of homeowners finding themselves upside-down in their mortgages, short sales are becoming ever more common. As they do, one should expect those lenders who have yet to streamline their short sale processes to do so, and the overall experience to become smoother and more uniform from lender to lender.

Photo: Safe And Secure, originally uploaded by bob1217.

Case-Shiller: Prices continue to decline

From the Wall Street Journal:

In the first quarter, the Case-Shiller indexes showed home prices across the
country fell 14% from a year earlier, representing the largest drop in the
20-year history of the indexes. From the fourth quarter, prices fell 6.7%.

“The steep downturn in residential real estate continues,” David M.
Blitzer, chairman of S&P’s index committee, said. He added, “There are very
few silver linings that one can see in the data. Most of the nation appears to
remain on a downward path.”

According to the indexes, released by ratings firm Standard & Poor’s, home prices in 10 major metropolitan areas fell 15% in March from a year earlier and 2.4% from February.

In 20 major metropolitan areas, home prices dropped 14% from a year earlier and 2.2% from February.

In Atlanta, the decline in prices continues to accelerate, with homes shedding 1% in value from last month, and 6.5% from last year. Still, it could be much worse: Las Vegas has lost almost 26% over the past year, with Miami and Phoenix dropping 24.6% and 23.0%, respectively.

While there is no question that house prices in Atlanta are falling, Atlanta’s continued desirability as a place to live has acted as a buffer to the effects of the housing market as seen in the rest of the county. Prices here have not fallen as much as they have elsewhere and will most likely rebound earlier than in other areas.

Still: as the availability of mortgage loans remains limited, it continues to be a challenging time to sell a home. With that being said, it remains an ideal time for real estate investors, with many, many homes available, and homes more affordable than they have been in years.

Photo: Flying ego, originally uploaded by Laurent Filoche.

Home sales up, home sales down

Existing home sales are down to another record low, from the New York Times:

Sales of previously owned homes, which make up the bulk of the housing market,
dipped 1 percent in April, to an annual rate of 4.89 million, the second
consecutive month that sales have declined. That figure represents another
record low, although the report, put out by the private National Association of
Realtors, dates only to 1999.

But, on the other hand new home sales are up. From CNN:

New home sales rose unexpectedly in April but remained near historically low
levels, according to a key government report on the battered housing market.

April sales came in at a seasonally-adjusted annual rate of 526,000, a
Census Bureau report showed, up 3.3% from a revised 509,000 in March, but 42%
below April 2007. The reading was above the consensus forecast of 520,000,
according to economists surveyed by Briefing.com.

The median price of a new home sold in April was $246,100, up 1.5% from $242,500 a year earlier.

The report showed a 10.6-month supply of homes available on the market.

Perhaps all of the discounting, upgrading, and other perks offered by homebuilders are finally having some effect on new home sales.

Photo: See-Saw, originally uploaded by pittsinger.