Twin Cities Real Estate Blog

The always excellent Calculated Risk goes into the simple reasons why 2nd mortgage holders are unlikely to embrace HAFA.

When a 2nd mortgage holder can only recover 3% of the loan or $3000, whichever is LESS, and they have to release the seller from all future liability, I can see why they will not be quick to take the deal.  In Minnesota, a foreclosure does not wipe out the 2nd lienholder’s rights and therefore it’s quite possible that they will seek future payments via collections – I could imagine them getting far more than 3% back that way.

While some 2nd mortgage companies have already been taking payments around this amount, many will not and I don’t see that changing – HAFA will help, but it will help far more on homes where there is only one mortgage vs two.

This just came through my email… is it down due to a problem with the vendors web site or due to unprecedented demand?  Only time will tell…

Office of Energy Security, Minnesota Department of Commerce
ENERGY STIMULUS UPDATE
Monday, March 1, 2010
Rebate Web Site Unavailable
 
We are aware that Appliance Rebate website is currently unavailable.

We are working with the vendor providing this service to identify and repair the problems.

The 1-877-230-9119 hotline is available but may be busy because of high call volume.

In the mentime, you can call the Energy Information Center if you need information:

1-800-657-3710 (MN only)
651-296-5175 (Metro area)

The Info Center CANNOT process your request for a voucher.

For more information, contact us at energy.info@state.mn.us or 800-657-3710.

Countdown timer above shows what little time is remaining for home buyers and sellers to take advantage of the tax credits!  To review:

• 1st time home buyers or those that have not been a homeowner for 3+ years may be eligible for an $8000 tax credit.
• Current homeowners who have lived in their home for 5 of the past 8 years may be eligible for a $6500 if they sign a purchase agreement for a new primary residence prior to May 1, regardless of if/when they sell their current home.

Everyone looking to take advantage of one of these tax credits needs to have an accepted purchase agreement no later than April 30th, 2010 and that sale must close by June 30th, 2010.

If you are a buyer looking at foreclosures, make sure you leave time for the bank to sign the paperwork.

If you are a buyer looking at short sales, it looks like you just need to have agreement with the seller (subject to approval from the seller’s lender) by April 30th, though you still need to close by June 30th and should also speak to your tax advisor about the situation prior to making a decision to sign a purchase agreement.

If you are a seller or potential seller, now is the time to get your house in tip-top shape, list it for sale, market the house heavily and price it to sell – it takes 23 showings on average to sell a home and those showings take time to happen!

Today I received an email from DR Horton offering 5% commission on select homes closing in the next 40 days:

What I’m wondering is at what point do commissions get so lucrative that it can severely influence an agent’s actions in representing their buyer?  Since discussing “usual” or “typical” commissions in a public forum can lead to antitrust issues, I won’t discuss numbers but I will say that 5% is above any buyer cooperative commission (buy-side only) that I’ve ever received.

For as long as I’ve been in the business (on my 8th year now!) I’ve heard grumblings of suspicion that some agents working with buyers put a bias towards listings that pay them higher commissions.  In many ways it makes sense – most agents are paid on commission only so selling a higher-priced listing or one with a higher payout does directly affect what they earn.  While it may make sense, steering a client based off of compensation reasons is unethical and violates Agency laws in Minnesota (and likely most other states too).  Needless to say, the influence is there and I have no doubt that some agents practice this, though I truly believe that most agents are true to their clients and don’t let a fatter commission check affect their representation of their client.

What concerns me here is that at some point the commission dollars get to be big enough that it becomes a much bigger enticement and therefore the chances of agent influence become higher.  Even if there is no true influence, the mere appearance of a conflict of interest becomes apparent.

On the flip side, this is a great marketing tool by DR Horton – they attract lots of interested agents to see if DR Horton has a house that fits their buyer’s needs since it would be a big fat payout for the agent.  DR Horton only has to pay that commission on closed sales that meet their rules, so a penney isn’t spent unless there is a result.  Also, since this is only for inventory/spec homes, what they’re doing is putting them on a kind of clearance sales so that they don’t have to keep paying the carrying costs for a vacant completed home.  Smart.

There are two sides to this – I’m curious on what anyone else may think about this.  Please comment!

Last week was a notable week for those data buffs among us – HousingLink released their 2009 Foreclosure Report and the Mortgage Bankers Association released their quarterly delinquency survey.

As Chris Snowbeck from the Pioneer Press notes in a recent article, the HousingLink data is good news but can’t be considered a sign that the foreclosure problem is waning – there are many efforts being made to reduce foreclosures and they’ve had an impact temporarily but not all these efforts will be successful and there are still a lot of in-default homeowners that will need to be addressed one way or another in the coming quarters.

The Pioneer Press also has a great writeup on the MBA data in our local market - while an amazing 6.9% home loans 90+ days delinquent or in foreclosure, the percentage of loans 30-59 days delinquent has remained very flat for over a year and is showing signs of a downtrend in recent quarters - a good sign that locally borrowers current on their mortgages are having an easier time doing so.   I’d love to pour over more info in their report but they want a princely sum of money to see it and I’m not paying.

Want to know the latest good and bad news in the Minneapolis/St. Paul housing market?  Take a peek at this video:

4 Bdrm 4 bath 4,400 sq./ft. hillside home on 4 plus acres, 7 min. from Middleton. Master suite with whirlpool and deck. Fieldstone fireplace, wraparound porch, storm/wine cellar, spectacular room to grow marijuana, open floor plan, elevator and handicap accessible with in-law suite. 2 1/2 car garage with lower level shop. Separate 40′ x 60′ commercial grade shop with loft, office and 3/4 bath. Perfect for toys or animals. Middleton-Cross Plains schools. $675,000

So say the MLS remarks of this listing.  Don’t believe me?  Here it is on the MLS itself, along with the contact info for the listing agent and the seller, who appears to be representing himself.

How on earth is this possible?  Well, based on what I can see, this broker seems to allow sellers to enter their own listings into the MLS, a horrifying thought.  The other option is that this was input by the listing agent… which seems more horrifying than the seller doing it.  In case the property details have been changed by the time you read this, here is a PDF of the marijuana house (2).

I occasionally see comments from the public saying things like: REALTORS are worthless, the MLS is a monopoly that needs to be forced to allow anyone to publish to it, MLS data should be public, and that Google/Trulia/Zillow/Craigslist make the MLS a thing of the past.  My counter to those comments is now clearer than ever: just look at this listing.

However this listing was posted to the MLS, the content of it is not permitted.  Because the MLS is controlled by a professional organization (the REALTORS), there will most certainly be a correction made and it is highly likely (hopefully) that some kind of penalty will be issued to the agent.  When it comes to accurate information about homes for sale or those that have sold, the MLS is in a field of its own.  While there are problems that do arise occasionally (this is an extreme example) this data is far more consistent and accurate than public options because it is a controlled system.

REALTORS are no longer the gatekeepers to the listings of homes for sale, but when it comes to ensuring the data is reliable, we still play the key role.  Most of the sites consumers use online to find homes for sale use data that originally came from the REALTOR and/or MLS.  I spend a lot of time helping buyers find the right house and helping sellers find a buyer, but I’d spend a whole lot more time if I didn’t have a reliable resource to use.

Because I have reliable information, even though finding the right house may take a lot of time, it is by far the easiest part of my job – its everything that happens after the right house is found that takes all of my skill, experience and knowledge.  Every day this job takes more to do right, something that runs counter to what you’d expect in an industry in the midst of a technology shift.  The problem is that no matter what new gadgets, software and web sites may be made, real estate is very complex and variable.  Though there are certainly both good and bad agents, this job would be practically impossible without the systems we REALTORS have in place.