Favorable April jobs growth report
With the news last week about the favorable April Jobs Growth Report and with the Dow jumping to over 15,000 just last week, real estate professionals throughout the United States are cheering that the recession is entirely behind us. In fact, many short sale agents may even be thinking that it’s time to look for a new area of expertise.
Three reasons to list short sales
Not so fast! Here are three reasons that short sale agents should still continue to see opportunities in the short sale world.
- Underwater Mortgages. According to the fourth quarter Zillow Negative Equity Report data, as of the last day of 2012, 27.5 percent of all U.S. homeowners are underwater. While we have seen some large-scale changes to the housing market in the last few months, there are still a significant number of underwater mortgagees that may need to sell today.
- Mortgage Re-Defaults. The Making Home Affordable Summary Results (through February 2013) on Home Affordable Modification Program (HAMP) state that there have been 862,636 Active Permanent Loan Modifications. Sadly, however, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) notes that 312,000 (36.18%) of these permanent modifications are currently in default. These folks in re-default will soon be seeking other remedies, and may not be able to keep their homes. That’s where you come in.
- Circumstances Change. Despite the fact that the economy is improving, with such a high percentage of borrowers still underwater, there will still be people that want or need to sell their homes today. Prospective sellers could include the unemployed, the underemployed, those upsizing, those downsizing, or those needing to relocate for other reasons. Because people will still need to sell in the next few years, there will still be short sales.
Things have changed, but don’t throw in the towel
Additional reasons that short sales will probably be around for quite some time include investor buyers, government cuts, and housing inventory issues. The way in which the huge faction of investor buyers has swarmed and will likely sell when the going is good may really change the economic climate. Government cuts resulting from the sequestration will hurt homeowners. And, many cities have low housing inventory and lots of multiple-offer situations; this inventory issue might be a recipe for a short-lived increase in property values.
There is no question that things have changed greatly since 2008. Many short sale listing agents now close traditional transactions in addition to their large portfolios of short sale listings. Nevertheless, for all of the reasons, if you are a short sale listing agent, I wouldn’t throw in the towel quite yet. By all means, don’t quite your day job; continue to polish your listing skills and take more short sale listings than ever before!