Monthly Archives: June 2011

Foreclosures off 30% this year

By Zack Childress Real Estate Investor, Investing, Automated Real Estate Systems, Automated Wholesaling Systems

NEW YORK (CNNMoney) — On the surface, the foreclosure crisis seems to be easing. The number of foreclosure notices filed during the first three months of 2011 fell 27% compared with the first quarter of 2010, according to a report from RealtyTrac released Thursday.

Only 681,000 properties got hit with some type of filing — a notice of default, a scheduled auction or a foreclosure sale — during the quarter, one for every 191 households.

There were 215,046 borrowers who lost their homes, down 17% year-over-year.

That improvement was in sharp contrast to other recent housing market metrics, with sales of existing and new homes very weak and home prices still sliding.

“The nation’s housing market continued to languish in the first quarter, even as foreclosure activity fell to a three-year low,” said James Saccacio, RealtyTrac’s CEO.

The explanation for this contradiction is that the foreclosure improvement has been artificial, fueled by banks reacting to paperwork processing issues — the infamous “robo-signing” scandal — by cutting back on filings until they can clean up their procedures.

According to RealtyTrac spokesman Rick Sharga, without the cutback there would have been 900,000 filings during the quarter instead of 681,000. There would have been 280,000 to 300,000 bank repossessions instead of 215,000, he added.
Houses: What a million dollars buys

Fewer homes were repossessed even though banks are modifying fewer loans to make them more affordable. Hope Now, a coalition of servicers, community groups and mortgage investors working to stem foreclosures reported last week that its members had modified 87,000 loans in February compared with 110,000 in December 2010.

Hope Now’s director, Faith Schwartz, said fewer mods hardly means that the foreclosure crisis is clearing. “In the midst of all the disruptions, it’s difficult to pinpoint a trend,” she said.

The big positive that Schwartz cites is the significant month-over-month drops in both new foreclosures and in the number of borrowers who are 60 days or more late with payments. If fewer borrowers are entering the foreclosure process, fewer should eventually lose their homes.

On the other hand, said Schwartz, the severity of the delinquencies is increasing, with these borrowers falling 527 days past due, on average.

In New York and New Jersey, according to Sharga, it’s more than 800 days now between when a typical delinquent borrower first receives a notice of default to when the home goes to a sheriff’s sale.

“It’s likely that most of those are not making any mortgage payments” during that period, he said.

The drop in foreclosures is widespread. RealtyTrac reported that filings dropped in each of the 20 hardest-hit metro areas. Year-over-year declines reached as high as 59% in Cape Coral, Fla., for the quarter. Even in Las Vegas, ground zero for the mortgage meltdown over the past few years, filings fell 8%.

Nevada, Arizona and California continued to rank as the states with the highest foreclosure rates. They came in 1-2-3 both for the quarter and for the month of March. The Fourth Horseman of the Foreclosure Apocalypse, Florida, has dropped down in the standings, to eighth place for the quarter and ninth for the month.

Las Vegas is once again the highest ranked metro area in per-capita foreclosures. One of every 31 homes absorbed a filing during the quarter, about six times the national norm. Modesto, Calif. (one in 46), Stockton, Calif. (one in 47), Vallejo. Calif., and Phoenix (both one in 48) filled out the top five.

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Real Estate investing tip…

“Well, real estate is always good, as far as I’m concerned. “-Donald Trump

Keeping with what Mr. Trump stated, real estate investing is one the pillars of wealth creation in the world today. The last time I looked at the Forbes list of 400 richest Americans, I could still count over 31 Real estate tycoons listed as billionaires.

In the same vein, you have individuals in your city and state who have made their fortune and hold their wealth in real estate investments; however, before you begin investing in properties you need to understand these critical success factors….

Clarity is important

How you start depends on what you want to achieve:

  • Are you looking at wealth accumulation within a short time frame (3-7 years)?
  • Are you investing for the Long term (retirement)?
  • Do you want to be a Full-time investor and derive all your income from your real estate investments?

    Develop critical success traits

    The next thing that is important is you develop the success traits of a real estate investor.

    Five main traits are important for success:

    • Competency in your niche, this means you know about the basics of real estate, at the minimum. When you are good in the real estate niche you decide to invest.
    • Control over your emotions. This is important if you are going to stay in the arena for the long haul because there will always be difficulties in the real estate market. The difference between a novice and a professional is the ability to ride the eye of the tiger without getting into the belly of the tiger. Being a real estate investor takes guts and you need to have them if you want to become wealthy.
    • Comprehension. This means know your market cold. You understand who your customers are, what they are looking for, and why they want to deal with you. If you lack the key trait of insight into your market, you are doomed to fail
    • Consistency. This means you have focus and discipline to take action daily and weekly until you accomplish your goals.
    • Integrity. You stay true to your principles, because integrity is important in real estate. This means you are trustworthy to your bankers, investors, and tenants.

    Knowing enough vs. Knowing it all

    I think it’s important to have an understanding of real estate investing; however, you don’t need to know all about real estate investing to start. One thing that I think is important for an investor is to know enough about the basics. How to analyze properties, how to get financing, and how to assemble your real estate team. That is it.

    Let’s recap how to succeed in real estate investing…

    • You need to understand why you are investing in real estate.
    • You need to develop critical traits for success as a real estate investor.
    • You need to choose the right tactics to match your investing objectives.
    • You need to know enough about what you want to achieve

    This is how I have applied myself to real estate investing. Moreover, it has helped me transform my losses to wins. As a result, I have enjoyed positive cash flow from my properties.

    By: Bryan Holmes

     

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    PROSPECTIVE HUNTSVILLE OPPORTUNITIES

    Boeing, one of Huntsville’s largest employment corporations, has issued a press release about having to send out layoff notices to employees in the missile defense program. Read the entire article here:

    What does this mean for you as an investor? We will show you!

    Job loss could mean foreclosures, REOs/lender owned properties, and auctions. It is a harsh reality, but take a look at this –

    In 2011, BRAC will be finished, but it will be far from over (Kenneth Kesner of the Huntsville Times). Joe Ritch, chairman of the Tennessee Valley BRAC Committee, also states that the deadline for completion of BRAC is September of this year; however, for years afterward, defense and aerospace companies are expected to expand or locate in the area. This is going to create another 5,000 jobs to support the workload on the arsenal, and an additional 9,000 indirect jobs are also expected such as hospitals, restaurants, and schools to help support the growing community.

    Redstone Arsenal Garrison Commander Col. John Hamilton also says that “BRAC is on schedule to end in September as required by law; however, it is important for everyone to realize BRAC is only a portion of the larger growth story for Redstone Arsenal and the surrounding communities.” Read the entire story here!

    The year to invest in the Huntsville and Madison area is now! Families and businesses are slowly making their way into the Madison County areas. As the population rises, the chances of property values will rise as well.