7 Housing Markets Buyers Are Eyeing Online

Sunbelt cities are garnering most of the attention online from potential home buyers, possibly being lured by bargain housing prices.

Several Florida and California metro areas were found to have the highest proportion of home searches from people outside the area, according to Trulia.com, which tracked about 100 million searches on its site from July 1 through Sept. 30.

“Part of the long term trend is Baby Boomers moving toward retirement, and some of those that put off their searches while home prices were skyrocketing in the Sun Belt, are now looking again because prices have fallen so much,” Jed Kolko, chief economist and head of analytics at Trulia, told Forbes.

Overall, the Florida market is showing big improvements recently. For example, the West Palm Beach-Boca Raton metropolitan statistical area (MSA) saw sales jump 34 percent in September compared to the same month last year, while Fort Lauderdale MSA saw an 11 percent increase in sales, Florida REALTORS® reports.

Here are some of the cities that topped the list for most online searches on Trulia, according to Forbes.

North Port-Bradenton-Sarasota, Fla.
Riverside-San Bernardino-Ontario, Calif.
Charleston, S.C.
Fort Lauderdale-Pompano Beach, Fla.
Cape Coral-Fort Myers, Fla.
West Palm Beach-Boca Raton, Fla.
Fort Worth, Texas
Find out what other cities topped the list.

Source: “Buyers Have Eyes on These Real Estate Markets,” Forbes (Dec. 1, 2011)

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Study Finds Fewer Borrowers Sinking in Negative Equity

The depreciation of home values over the past half-decade has left millions of mortgage borrowers owing more than their home is worth – 10.7 million, according toCoreLogic.

The company released its third-quarter update on negative equity within the U.S. housing market Tuesday. It shows that 22.1 percent of all residential properties with a mortgage were underwater as of the end of September.

That’s actually down from 22.5 percent – or 10.9 million borrowers – at the end of the second quarter, but CoreLogic says the number remains high and makes borrowers more vulnerable to economic shocks such as job loss or illness.

Nevada has the highest negative equity percentage with 58 percent of all its mortgaged properties underwater, followed by Arizona (47 percent), Florida (44 percent), Michigan (35 percent), and Georgia (30 percent).

This is the first quarter that Georgia entered the top five, surpassing California which had been in the top five since CoreLogic began tracking negative equity in 2009.

The top five states combined have an average negative equity ratio of 41.4 percent, while the remaining states have a combined average negative equity ratio of 17.6 percent.

Mortgage borrowers in New York have fared the best through the downturn, with just 6.3 percent in a negative equity position.

Other states on the low end of the spectrum include: North Dakota (6.9 percent), Oklahoma (7.3 percent), Pennsylvania (7.9 percent), and Montana (8.4 percent).

Should home prices continue to fall further, another 2.4 million mortgage borrowers in the U.S. could sink underwater – that’s the number of borrowers CoreLogic says had less than 5 percent equity in their homes, referred to as near-negative equity, in the third quarter.

Together, negative equity and near-negative equity mortgages accounted for 27.1 percent of all residential properties with a mortgage nationwide in the third quarter.

CoreLogic’s report provides additional details on the population of borrowers that are currently underwater.

Of the 10.7 million borrowers in negative equity, there are 6.3 million first liens without home equity loans that have an average mortgage balance of $222,000. They are underwater by an average of $52,000 which equates to an average loan-to-value (LTV) ratio of 131 percent.

The remaining 4.4 million negative equity borrowers hold first liens and home equity loans with an average mortgage balance of $309,000. These borrowers are underwater by an average of $84,000 and have an average LTV of 137 percent.

Given that bank portfolios account for 15 percent of all first lien mortgages, CoreLogic estimates that 1.6 million loans in a negative equity position are held by banks. Collectively these loans are underwater by about $105 billion.

Altogether, the 10.7 million borrowers who owed more than their home was worth at the end of the third quarter were underwater by a total of $699 billion by CoreLogic’s assessment.

Foreclosures Continue to Weigh on Home Values

Distressed homes continue to chip away at overall home prices across the country, but the “plunging collapse of prices seen in 2007-2009 seem to be behind us,” David Blitzer, chairman of the Index Committee at Standard and Poor, said in a recent statement. 

For the third quarter, market research firm CoreLogic reports about 22 percent of all borrowers with residential homes are “underwater,” owing more on their mortgage than their home is currently worth.

"The negative equity portion definitely continues to be one of the major issues for the housing market, [and] the overall economy as well," Anika Khan, an economist with Wells Fargo Securities, told Market News International.

The states with the highest percentage of borrowers with negative equity, according to CoreLogic are:

• Nevada: 58 percent
• Arizona: 47 percent
• Florida: 44 percent
• Michigan: 35 percent
• Georgia: 30 percent

"Home prices continue to come down due to the number of distressed transactions, be it short sales or foreclosures or REO, and we expect that pace to continue into 2012," Khan told Market News International.

Source: “Analysts: Distressed Sales Still Weighing On US Housing Market,” Market News International (Nov. 29, 2011)

Boomers More Willing to Help Kids With Down Payments

Two-thirds of baby boomers say they want to help their children or grandchildren with a home down payment, according to a study of more than 1,000 baby boomers age 45 and up conducted by Meredith Research Solutions for Better Homes and Gardens Real Estate. 

In fact, one in five boomers surveyed say they've already loaned their children money, cosigned a mortgage, or given a cash gift for a down payment on a home.

Even baby boomers not considered wealthy are willing to offer help on down payments. While baby boomers who make more than $75,000 a year were found to be the most willing to offer help, 46 percent of baby boomers who make less than $75,000 per year say they also plan to help their child with a future home purchase, according to the survey. 

So why are baby boomer parents so willing to help their children out with a home down payment? About 75 percent of boomers said they believe owning a home is a good investment for their children, and 58 percent said they think it’s still part of the American dream. 

Pending Home Sales Jump in October

Pending home sales rose strongly in October and remain above year-ago levels, according to the National Association of REALTORS®.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, surged 10.4 percent to 93.3 in October from 84.5 in September and is 9.2 percent above October 2010, when it stood at 85.5. The data reflects contracts but not closings.

Lawrence Yun, NAR chief economist, said improved contract activity is a hopeful sign. “Home sales have been plodding along at a sub-par level while interest rates are hovering at record lows, and there is a pent-up demand from buyers who normally would have entered the market in recent years. We hope this is indicates more buyers are taking advantage of the excellent affordability conditions,” he said.

“Many consumers are recognizing that home buyers in the past two years have had one of the lowest default rates in history. Moreover, continued inventory declines are another healthy sign for the housing market,” Yun added.

The PHSI in the Northeast surged 17.7 percent to 71.3 in October and is 3.4 percent above October 2010. In the Midwest, the index jumped 24.1 percent to 88.7 in October and remains 13.2 percent above a year ago. Pending home sales in the South rose 8.6 percent in October to an index of 99.5 and are 9.7 percent higher than October 2010. In the West the index slipped 0.3 percent to 105.5 in October but is 8.1 percent above a year ago.

“Although contract signings are up, not all contracts lead to closings. Many potential home buyers inadvertently hurt their credit scores and chances of getting a mortgage through easily averted actions, such as cancelling an old credit line while taking on a new one,” Yun said. “Such actions could unwittingly prevent buyers from obtaining a mortgage if their credit score is close to the margins of qualifying, or they might get a loan but with less favorable terms.”

Sabre Real Estate Hires 3 Senior Brokers

Sabre Real Estate Group LLC expanded its Garden City, NY, operations with three recent hires. 

Beth Lamport joined the company as executive vice president. She was most recently a director with Breslin Realty. The retail specialist also served as a broker at Polimeni Realty and two decades at Macy’s (formerly Federal Department Stores) as a marketing executive. 

Lamport’s focus is tenant representation. The Cornell University grad currently works with Ulta Beauty, Trader Joe’s, Tuesday Morning, Pet Supplies Plus, Chili’s, Maggiano’s and PGA Super Store. 

Anthony Russo was hired as a vice president. The broker assumed the role after 15 years with NAI Long Island (formerly Bagnato Realty Services). Russo has represented both landlords and tenants, including Walgreen’s, NEFCU, Davis Vision Optical, Iavarone Brothers Gourmet Markets, Umberto’s of New Hyde Park and GNC. 

Leasing expert Stuart Fagen joined Sabre as managing director. The entrepreneur formerly oversaw the Fagen Group., a retail brokerage company he founded. His 17 year of experience includes stints at Breslin Realty, the Alrose Group as director of acquisitions and leasing specialist with Gould Investors LP. He’s negotiated tenant leases for Walmart, Commerce Bank, Starbucks, AT&T Wireless, EB Games, Yum Brands, Omaha Steaks, Quiznos, Verizon and other retailers. 

Sabre is a full-service retail real estate brokerage firm focused on tenant and owner representation in metro New York.