Connect with us

Housing News

City invoking eminent domain on underwater houses

Local governments in California are known to launch experiments, but invoking eminent domain on underwater mortgages is raising questions and eyebrows across the nation.



california texas

california texas

Eminent domain on underwater mortgages?

We’ve heard of cities invoking eminent domain for initiatives such as parks and roads – things generally assumed to benefit the public good. But the city of Richmond, California announced a plan Tuesday to go rogue and utilize eminent domain to seize underwater mortgages from investors and then re-offer them at fair market value to struggling home owners.

The reasoning behind this decision is that homeowners are paying on mortgage balances that are substantially higher than the market value of the home, causing home owners to become delinquent on their payments and foreclose. The closer that these home owners come to foreclosure, they less incentivized they are to keep up with payments, and higher counts of vacant, foreclosed properties lead to crime.

Mayor defends program

This would result in a loss for the investors who currently back these mortgages, but the city of Richmond says if the two parties are unable to reach an agreeable solution by August 14, it will invoke eminent domain to take control of these mortgages.

“They can put forward as much pressure as they would like but I’m very committed to this program and I’m very committed to the well-being of our neighborhoods,” said Gayle McLaughlin, current mayor of the city of Richmond.

How the program is operating

Mortgage Resolution Partners is currently managing the plan and is offering to buy both current and delinquent mortgage loans. After seizing a property, MRP would reduce the amount of the mortgage closer to the actual value of the home – for instance, taking a $400,000 mortgage on a home that is only worth $300,000, and purchasing it for $240,000. Once the city has control of that mortgage, it would allow home owners to finance the property at an amount slightly higher than the purchase price, say at a price point of $270,000.

That extra $30,000 in profit would go back to the city and the investors who bought the loan, and according to Richmond government officials, both the city and its residents would essentially be better – the city makes a profit and home owners get to keep their homes and pay a decreased amount that is more in line with market value.

What if this plan goes through?

Should this plan go through, it will serve as a huge deterrent to lenders who currently back mortgages in the Richmond area. Investors can argue that they have the freedom to clearly lay out the rules and expectations of a mortgage agreement and have home owners agree to those terms without having the government step in and seize the investment if it doesn’t agree with the way things are going.

If the use of eminent domain in the mortgage industry becomes the norm, it will certainly shrink the number of investors who are willing to back mortgage loans and could make it more difficult for interested parties to get the funding they need in order to buy a home.

Destiny Bennett is a journalist who has earned double communications' degrees in Journalism and Public Relations, as well as a certification in Business from The University of Texas at Austin. She has written stories for AustinWoman Magazine as well as various University of Texas publications and enjoys the art of telling a story. Her interests include finance, technology, social media...and watching HGTV religiously.


Austin tops the list of best places to buy a home

When looking to buy a home, taking the long view is important before making such a huge investment – where are the best places to make that commitment?



Looking at the bigger picture

(REALUOSO.COM) – Let us first express that although we are completely biased about Texas (we’re headquartered here, I personally grew up here), the data is not – Texas is the best. That’s a scientific fact. There’s a running joke in Austin that if there is a list of “best places to [anything],” we’re on it, and the joke causes eye rolls instead of humility (we’re sore winners and sore losers in this town).

That said, dug into the data and determined that the top 12 places to buy a home are currently Texas and North Carolina (and Portland, I guess you’re okay too or whatever).

They examined the nerdiest of numbers from the compound annual growth rate in inflation-adjusted GDP to cost premium, affordability, taxes, job growth, and housing availability.

“Buying a house is a big decision and a big commitment,” the company notes. “Although U.S. home prices have risen in the long term, the last decade has shown that path is sometimes full of twists, turns, dizzying heights and steep, abrupt falls. Today, home prices are stabilizing and increasing in most areas of the U.S.”

Click here to continue reading the list of the 12 best places to buy a home…

Continue Reading

Housing News

Average age of houses on the rise, so is it now better or worse to buy new?

With aging housing in America, are first-time buyers better off buying new or existing homes? The average age of a home is rising, as is the price of new housing, so a shift could be upon us.



aging housing inventory

aging housing inventory

The average home age is higher than ever

(REALUOSO.COM) – In a survey from the Department of Housing and Urban Development American Housing Survey (AHS), the median age of homes in the United States was 35 years old. In Texas, homes are a bit younger with the median age between 19 – 29 years. The northeast has the oldest homes, with the median age between 50 – 61 years. In 1985, the median age of a home was only 23 years.

With more houses around 40 years old, the National Association of Realtors asserts that homeowners will have to undertake remodeling and renovation projects before selling unless the home is sold as-is, in which case the buyer will be responsible to update their new residence. Even homeowners who aren’t selling will need to consider remodeling for structural and aesthetic reasons.

Prices of new homes on the rise

Newer homes cost more than they used to. The price differential between new homes and older homes has increased from 10 percent traditionally to around 37 percent in 2014. This is due to rising construction costs, scarcity of lots, and a low inventory of new homes that doesn’t meet the demand.

Click here to continue reading this story…

Continue Reading

Housing News

Are Realtors the real loser in the fight between Zillow Group and Move, Inc.?

The last year has been one of dramatic and rapid change in the real estate tech sector, but Realtors are vulnerable, and we’re worried.



zillow move

zillow move

Why Realtors are vulnerable to these rapid changes

(REALUOSO.COM) – Corporate warfare demands headlines in every industry, but in the real estate tech sector, a storm has been brewing for years, which in the last year has come to a head. Zillow Group and Move, Inc. (which is owned by News Corp. and operates ListHub,, TopProducer, and other brands) have been competing for a decade now, and the race has appeared to be an aggressive yet polite boxing match. Last year, the gloves came off, and now, they’ve drawn swords and appear to want blood.

Note: We’ll let you decide which company plays which role in the image above.

So how then, does any of this make Realtors the victims of this sword fight? Let’s get everyone up to speed, and then we’ll discuss.

1. Zillow poaches top talent, Move/NAR sues

It all started last year when the gloves came off – Move’s Chief Strategy Officer (who was also’s President), Errol Samuelson jumped ship and joined Zillow on the same day he phoned in his resignation without notice. He left under questionable circumstances, which has led to a lengthy legal battle (wherein Move and NAR have sued Zillow and Samuelson over allegations of breach of contract, breach of fiduciary duty, and misappropriation of trade secrets), with the most recent motion being for contempt, which a judge granted to Move/NAR after the mysterious “Samuelson Memo” surfaced.

Salt was added to the wound when Move awarded Samuelson’s job to Move veteran, Curt Beardsley, who days after Samuelson left, also defected to Zillow. This too led to a lawsuit, with allegations including breach of contract, violation of corporations code, illegal dumping of stocks, and Move has sought restitution. These charges are extremely serious, but demanded slightly less attention than the ongoing lawsuit against Samuelson.

2. Two major media brands emerge

Last fall, the News Corp. acquisition of Move, Inc. was given the green light by the feds, and this month, Zillow finalized their acquisition of Trulia.

…Click here to continue reading this story…

Continue Reading

Our Great Partners

American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.

Emerging Stories

Get The American Genius
neatly in your inbox

Subscribe to get business and tech updates, breaking stories, and more!