Housing News
Fannie Mae gives incentive to short sale homes over foreclose
Fannie Mae releases new rules
In an effort to help distressed homeowners avoid foreclosure, effective July 2010, troubled homeowners that opt to voluntarily release their homes through a “deed in lieu of foreclosure” or by completing a short sale will now be eligible to apply for another Fannie Mae backed loan in two years.
In 2008, the waiting period was reduced from five years to four and now is at two. After that two year period, to qualify, a minimum 20% down payment will be required unless there are “extenuating circumstances” such as job loss, according to The Wall Street Journal.
Doesn’t this encourage people to walk away?
Critics of the move call this an encouragement for homeowners to walk away from their homes, putting the real estate sector back in jeopardy similarly to the continuing subprime crisis.
“We don’t want to say that there’s a ‘get out of jail’ card during recessions to walk away from your house,” FHA Commissioner David Stevens told the Wall Street Journal. “We are beginning to think about post-recession, how you address borrowers who became unemployed through no fault of their own … and now deserve the right to re-enter the housing-finance system.”
Fannie Mae counterpart, Freddie Mac still requires a four year wait, but if the Fannie Mae program is successful in curbing foreclosures, perhaps Freddie Mac will follow suit.
CC Licensed image courtesy of thetruthabout via Flickr.com.
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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.
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.
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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.
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, Realtor.com, 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 Realtor.com’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…
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Benjamin Ficker
April 27, 2010 at 2:01 am
At least here in Phoenix, people don’t need another reason to walk away. We get calls from people everyday who are current and ready to let it go to foreclosure because the home is worth a third of what they owe. Letting people back into the market will more then likely encourage buying again as well as doing a short sale.
Jim Olenbush
April 27, 2010 at 8:01 pm
It certainly does seem like Fannie Mae is encouraging some people to let their house go, because you can always jump back in after only two years.