Lowball offers not effective in all markets……

Miami buyers might think that Florida’s housing crisis can let them get away with low-balling their offers, but that’s not the case in every market.
Brian Carter, managing broker at Douglas Elliman Florida, said that in the luxury market, offers will be quickly rejected if they are more than 10 percent away from the asking price.
“The luxury condo market and luxury retail market have held up,” Carter said. “You wouldn’t want to lowball in that market, you run the risk of offending the seller. They can easily find someone else to buy it.”
The mid-Miami market is where buyers can find some deals, especially in homes facing short sales, when the equity falls below what the owner still owes on the mortgage.
“Though it might offend the seller’s offer, you can offer 30 to 40 percent off [the market price],” Carter said. “The owner will just be ecstatic about getting out of that property.”
In bank-owned foreclosure properties, Carter said the prices are already down considerably, so making an offer more than 10 percent below the price could be futile.
“The agents that work in all those different markets need to be coached differently to get deals done,” especially with uninformed buyers looking to take advantage of the down market and buy cheap property, he said. Knowledgeable brokers are needed to help decide on prices that are realistic for each specific market, he said.

Mortgage rates and applications, falling together……

Mortgage applications fell again last week, even as rates returned to their downward trend, according to mortgage application data for the week ending Aug. 24 released today by the Mortgage Bankers Association. Applications slumped 4.3 percent overall, on the back of a 6 percent decline in applications for mortgage refinances. Applications for purchases, however, jumped 1 percent.

The increase in mortgages for purchase coupled with the decrease in refinance applications dropped the refinance share of activity to 79 percent of total applications from 80 percent the prior week.

Average interest rates fell six basis points to 3.80 and five basis points to 4.06 percent for conforming 30-year fixed-rate loans and jumbo 30-year fixed-rate mortgages, respectively. Federal Housing Administration-backed 30-year fixed-rate mortgages had an average interest rate of 3.60, down from 3.62. Finally, 15-year fixed-rate mortgage rates dropped to 3.12 percent from 3.15 percent. — Adam Fusfeld

Mortgage rates and applications, falling together……

Mortgage applications fell again last week, even as rates returned to their downward trend, according to mortgage application data for the week ending Aug. 24 released today by the Mortgage Bankers Association. Applications slumped 4.3 percent overall, on the back of a 6 percent decline in applications for mortgage refinances. Applications for purchases, however, jumped 1 percent.

The increase in mortgages for purchase coupled with the decrease in refinance applications dropped the refinance share of activity to 79 percent of total applications from 80 percent the prior week.

Average interest rates fell six basis points to 3.80 and five basis points to 4.06 percent for conforming 30-year fixed-rate loans and jumbo 30-year fixed-rate mortgages, respectively. Federal Housing Administration-backed 30-year fixed-rate mortgages had an average interest rate of 3.60, down from 3.62. Finally, 15-year fixed-rate mortgage rates dropped to 3.12 percent from 3.15 percent. — Adam Fusfeld

Has Florida’s high delinquency rate created a “culture of default?”

Zillow’s report Thursday showed that while Florida does not have the most negative equity in the U.S., it does have a disproportionately high delinquency rate. According to the Wall Street Journal, part of the problem lies in Florida’s exclusively judiciary foreclosure process, which can keep borrowers in limbo for as long as 861 days – the state’s average foreclosure length in April.

“There are a lot of people hanging out in that pipeline,” Stan Humphries, Zillow’s chief economist, said. “If you’ve been around people who’ve defaulted, you’re much more likely to default yourself.” [WSJ] – Christopher Cameron

Home loan late payments hit 3-year low in 2Q

LOS ANGELES – Aug. 8, 2012 – U.S. homeowners are getting better about keeping up with their mortgage payments, driving the percentage of borrowers who have fallen behind to a three-year low, according to a new report.

Still, the rate of decline remains slow, credit reporting agency TransUnion said Wednesday. The percentage of mortgages going unpaid is unlikely to return anytime soon to where it was before the housing market crashed.

Some 5.49 percent of the nation’s mortgage holders were behind on their payments by 60 days or more in the April-to-June period, the agency said. That’s the lowest level since the first quarter of 2009.

The second-quarter delinquency rate is down from 5.82 percent in the same period last year, and below the 5.78 percent rate for the first three months of 2012.

The positive second-quarter trend coincided with an improving outlook for the U.S. housing market.

A measure of national home prices rose 2.2 percent from April to May, the second increase after seven months of flat or declining readings. Sales of new homes fell in June after reaching a two-year high in May. Sales of previously occupied homes also declined in June, but were higher than a year earlier.

Home refinancing surged in the second quarter, as interest rates sank to historic lows. And more borrowers with underwater mortgages – or home loans that exceed the value of the home – refinanced through the government’s Home Affordable Refinance Program than ever before.

“More people are making their payments, and that’s great,” said Tim Martin, group vice president of U.S. housing for TransUnion. “I expected a little bit better, but maybe we’ll see some more of that pick up in (the third quarter).”

Even as housing trends turned positive earlier this year, the U.S. economy began to show signs of faltering. The national unemployment rate remained stuck at 8.2 percent, and the pace of job growth slowed sharply, with employers adding an average of only 75,000 jobs in the April-June quarter. Hiring appeared to pick up in July, however, with employers adding 163,000 jobs.

TransUnion anticipates the mortgage delinquency rate will continue to decline. But it doesn’t see it falling below 5 percent this year.

The national delinquency rate remains well above its historical range, an indication many homeowners are still struggling five years after the housing downturn.

Before the housing bust, mortgage delinquencies were running at less than 2 percent nationally. It took about three years after the housing market crashed for the delinquency rate on mortgages to climb to a peak of nearly 7 percent in the fourth quarter of 2009. The rate has been trending down since then.

Home prices need to recover further for the delinquency rate to decline.

At the state level, Florida led the nation with the highest mortgage delinquency rate of any state at 13.48 percent, down from 13.91 percent a year earlier. It was followed by Nevada at 10.85 percent; New Jersey at 8.15 percent; and, Maryland at 6.79 percent.

The states with the lowest delinquency rate were North Dakota at 1.32 percent; South Dakota at 1.94 percent; Nebraska at 2.24 percent; and, Wyoming at 2.41 percent.

Foreclosure hotbeds Arizona and California each saw marked improvement during the second quarter.

California’s mortgage delinquency rate fell nearly 22 percent to 6.13 percent from a year earlier, while Arizona’s declined 21 percent to 6.14.

One reason for the sharp declines in mortgage delinquency rates in those states is that homes tend to move faster through the foreclosure process than in Florida, New York and other states where the courts play a role in the process. That leads to logjams of cases involving home loans that may have gone unpaid for two years or more.

“You have states that are taking a long time to work through the delinquencies that they have, which is keeping their numbers up,” Martin said.

TransUnion’s research is culled from its database of 27 million anonymous consumer records.
Copyright © 2012 The Associated Press, Alex Veiga, AP real estate writer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

More homeowners refinancing through HARP

WASHINGTON – Aug. 8, 2012 – According to the Federal Housing Finance Agency’s (FHFA) June Refinance Report, one-third of all home refinances through Fannie Mae and Freddie Mac were made through the Home Affordable Refinance Program (HARP) – the highest percentage of homeowners helped by HARP since the program began in April 2009.

FHFA attributed the increase in HARP volume to record-low mortgage rates and program enhancements announced last fall. After failing to meet forecasts, the federal government tinkered with HARP. Last fall, it removed the loan-to-value (LTV) ceiling for borrowers who refinance into fixed-rate loans and, for some borrowers, it removed or lowered fees.

Also in the report:

• Fannie Mae and Freddie Mac refinanced more loans through HARP in the first half of this year, 422,969, than the 400,024 it refinanced in all of 2011.

• HARP refinances for loans with LTV greater than 125 percent were also up in June – more than 40 percent of HARP loans.

• More than two-thirds of borrowers in states hard-hit by the housing downturn – Florida, Nevada and Arizona – refinanced through HARP in June, compared with 33 percent nationwide.

FHFA says that since 2009 Fannie Mae and Freddie Mac refinanced more than 2.2 million loans through their existing programs and more than 1.4 million loans through HARP.

FHFA has the full report posted online.

© 2012 Florida Realtors®

Miami metro home prices rose 9.6 percent in June

August 08, 2012 09:00AM
Home prices in the Miami-Miami Beach-Kendall area, including distressed sales, jumped 9.6 percent in June compared to the same period in 2011, according to a new report from CoreLogic. Excluding distressed sales, prices increased by 8.1 percent during the same period. Nationally, home prices rose 2.5 percent in June. “Home prices are responding positively to reductions in both visible and shadow inventory over the past year,” said Mark Fleming, chief economist for CoreLogic. “This trend is a bright spot because the decline in shadow inventory translates to fewer distressed sales, which helps sustain price appreciation.” — Alexander Britell

CitiMortgage homeowner rental program includes Florida

South Florida Business Journal
Date: Thursday, August 9, 2012, 7:51am EDT

A CitiMortgage pilot program in Florida and five other states will aim to keep struggling homeowners in their houses.
The Sun Sentinel reports that the program will transfer mortgages to the bank in deed-for-lease arrangements, turning the homeowner into a renter. It will begin with about 500 candidates selected by Carrington Capital Management, which will also manage the pilot program.