Scott Dorn\’s Blog

  I just ran a market report reflecting a 15 month period from October of 2009 thru December of 2010. I have to admit the numbers weren™t all that surprising to me. It indicates that west Michigan is moving in the right direction as far home sales.   We aren™t out of the woods by any means but moving in a positive direction.

  There are some indicators that that show some encouraging trends, such as average price per square foot; in October of 2009 the APPSF was   $111.00 and in December of 2010 it had increased to $112.00 resulting in an increase of 1.4%. During the 15 month period the APPSF had dipped as low as $104.00

  Also encouraging is the list to sale price ratio. In October of 2009 a seller could reasonably expect to sell their home for 93% of the list price (provided the home was correctly priced) and in December of 2010 that percentage had risen to 94%.   In November of 2009 the list to sale ratio was down to 92%

  Days on market I must admit did cause me to take a second look.   In October of 2009 the average time a correctly priced home was listed before it was sold and closed was 130 days, in December of 2010 the amount of time had dropped to 83 days or a decreased œshelf life of 36.2%. Very encouraging data.

  The average home price of homes that sold in October of 2009 was $141,000.00 and in December of 2010 the average price had increased to $143,000.00 or an increase of 1.4%.   Sellers appear to have adjusted their list prices to reflect market conditions over the past few years as well as the average price of listed properties, or those homes that are for sale decreased 5.3% over the same 15 month period.

  The most encouraging statistic I found was the overall inventory available.  In October of 2009, there were 1873 homes available for sale in West Michigan. In December of 2010 that number had dropped to 1410 properties available.   A substantial decrease considering the amount of foreclosures released by banks, Freddie and Fannie over the same time.

  So, based on this information what do we know? Well, we know that if are a buyer who was waiting for œthe market to hit bottom and you haven™t purchased a home, you missed the œbottom and now more than ever you may want to have a sense of urgency.   The data shows that things are rebounding. If you are a seller, the information would indicate that the table are turning and the real estate market is cycling back to a healthier market where sellers aren™t at such a disadvantage.

  For more information please don™t hesitate to call me or reach me through my web site www.ScottDorn.com

Happy Holidays everyone,

In this season of parties, family, parties, family and presents we should take time to reflect on the past year and look forward to the new year around the corner.

I know I haven’t kept up with my blogs as I should have and that is on my list of New Years resolutions. I would like to take an opportunity to thank all the clients I have had the privilege to assist this year either buying, selling or doing Loan Modifications. There are many real estate sales people to choose from. I  an  honored that you have listed me as a Real Estate Professional. Obviously there’s a huge difference. Sales people look only at commission checks, professionals look at long term satisfaction, service after  the sale and hopefully referrals resulting from a job well done.

I look forward to building my business even more in 2011 with your help and trust.

Merry Christmas, Happy New Year and until we meet again…God Bless.

 Scott,

Your Hometown Agent

    In today’s short sale market, FRAUD has been running rampant. Many so called “investors” have been running rough shod over the Short Sale Market claiming to do a “service” for both the seller and the bank holding the note. In truth, these practices have been in the grey area of legal since their inception. Basically, these “investors” throw a low ball offer to a bank on a specific home triggering the the Short Sale process with the Lien holder (bank). These investors will then meet with appraisers to point out all flaws and deficiencies in the home and do all in their power to drive the “value” of the home as low as possible. When the investor has made a case to the bank that the value indicated (which often times is way below true value) they will sell the home, using the existing listing first contracted between the seller and Real Estate agent to obtain a new buyer. The “investor” then negotiates with the new buyer, who often times is clueless that the actual home owner has nothing to do with the negotiations, come to an agreement and the property closes. Twice within an hour or so. The “investor” buys it at Short Sale price and then in turn sells it to the new buyer at an inflated price.

    Banks and the federal government are becoming wise to this practice and laws have been initiated in an effort to thwart this behavior. Banks are realizing that they are settling a debt for less than owed based on appraisals indicating that the offer agreed upon is actual value only to find that the same house was sold again the same day often times for tens of thousands more. Sellers with second mortgages are finding out that they are paying off a junior lien for more than they could or should be if the actual “second sale” been first, satisfying their obligations. This practice is FRAUD plain and simple. In my market it’s common and  I fear serious litigation is on the way once a true understanding of money lost is determined by both Banks and Home Owners.

  In fact, this just released today on Inmans -

“The HAFA program guidelinesissued by the Treasury Department in November include measures intended to thwart fraud. Properties must be publicized in a multiple listing service (MLS) and marketed by the listing broker.

Any short sale “must represent an arm’s-length transaction and that the purchaser may not sell the property within 90 calendar days of closing, including certification language regarding the arm’s-length transaction that must be included in the sales contract,” the guidelines say.”

No 3rd party investor will close on a property and wait 90 days with no guarantee of a contracted buyer.

If you are a home owner who is in need of negotiating a Short Sale on your home, do it the right way and legal way. Contact a reputable Realtor knowledgeable in short sales and maximize your interest from their knowledge. It will save you thousands and possibly keep you out of court.

www.ScottDorn.com

 Short Sales have become a prominent form of selling homes in today’s market. In fact, for thast couple of years they have been the bulk of home sales, along with foreclosures in West Michigan. With this in mind, it still surprises me how so many Realtors haven’t taken the time to educate themselves as to how the process works. Negotiating with a lender to accept less than what is owed takes a tremendous amount of time. I always advise my buyer clients to prepare for at LEAST four to six weeks before any response or update from a lender. It is important for all parties to understand that it takes a certain amount of time (and each bank handles short sales differently so time frames often vary) to make sure that all necessary documentation is submitted BEFORE the process even begins. I almost chuckle when the day after I submit a short sale package to the bank for approval, the cooperating agent calls me for an update. It reminds me of when my kids were younger and we would go on trips, I can still hear them..”ARE WE THERE YET”?

 It’s the resposibility of the buyers agent to educate the buyer about the short sale process. If someone wishes to close on their new home in 30 to 60 days, why would any agent even show them homes subject to bank approval of selling short? Yes, often times the buyer can get a good deal but, if it doesn’t fit their  desired time line to move, whats the point?

 Banks are getting more streamlined in their approach to processing and handling short sales however, it is still a lengthy proccess and should not be looked at as another typical transaction. Time must be factored in for review of the buyers requirement for a negotiated settlement via a short sale. The ordering of a BPO, and final approval by the investors. And typicaly, for the buyer, once the bank approves the short sale thats when things move forward on their end with financing, inspections, appraisals etc.

 Are Short Sales common? Yes. Can a buyers and seller both benefit from them? Yes Can one be closed in 60 days or less? Probably not.

The country is now undergoing “a nascent economic recovery” from the worst downturn in generations, Federal Reserve chairman Ben Bernanke said today in his semi-annual report to Congress. But he said improvement would take time, with high unemployment and low interest rates continuing.

It’s easy to get caught up in the doom and gloom of the current economic state of the country but it appears that things are begining to turn around, albiet slowly. Unemployment is down a little to to 9.7% and consumer confidence is slightly higher.

Low interest rate, a slight loosing of credit to small business and the private sector along with continued low interest rates will help direct the ship.

Existing home sales and new housing starts continue to improve each month in no small part due to the first time home buyer tax credit. Also, the numbers of foreclosures coming on the market is slowly shrinking.

We aren’t out of the woods yest and the recovery will be a lengthy one but most of the indicators appear to be pointing in the right direction.

I get asked no less than 15 times a week this question, “Scott, how are sales? Or Scott, whats happening out there?” in referrence to te real estate market.

I found this article in a REALTY TIMES in an emailed News Letter and thought it would be beneficial to share this with everyone. This article was not written or edited by me in any way, I’m simply sharing with youi the information.

After a rising surge from September through November, existing-home sales fell as expected in December after first-time buyers rushed to complete sales before the original November deadline for the tax credit. However, prices rose from December 2008 and annual sales improved in 2009, according to the National Association of REALTORS ^®.

Existing-home sales — including single-family, townhomes, condominiums and co-ops — fell 16.7 percent to a seasonally adjusted annual rate¹ of 5.45 million units in December from 6.54 million in November, but remain 15.0 percent above the 4.74 million-unit level in December 2008.

For all of 2009 there were 5,156,000 existing-home sales, which was 4.9 percent higher than the 4,913,000 transactions recorded in 2008; it was the first annual sales gain since 2005.

Lawrence Yun, NAR chief economist, said there were no surprises in the data. “It’s significant that home sales remain above year-ago levels, but the market is going through a period of swings driven by the tax credit,” he said. “We’ll likely have another surge in the spring as home buyers take advantage of the extended and expanded tax credit. By early summer the overall market should benefit from more balanced inventory, and sales are on track to rise again in 2010. However, the job market remains a concern and could dampen the housing recovery — job creation is key to a continued recovery in the second half of the year.”

An NAR practitioner survey² shows first-time buyers purchased 43 percent of homes in December, down from 51 percent in November. Repeat buyers rose to 42 percent of transactions in December from 37 percent in November; the remaining sales were to investors.

The national median existing-home price³ for all housing types was $178,300 in December, which is 1.5 percent higher than December 2008. “The median price rose because of an increased number of mid- to upper-priced homes in the sales mix,” Yun said. It was the first year-over-year gain in median price since August 2007.

NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said market conditions are challenging in some areas. “There’s a shortage of lower priced homes for sale in much of the country, resulting in multiple bids in some areas,” she said.

“Raw unsold inventory has been trending down. As the market heats up again this spring, buyers may need to be prepared to move quickly on a particular home — the best advice is to begin working with a Realtor ^® now to be able to use the tax credit and benefit from the increased buying power in the current market,” Golder said.

Total housing inventory at the end of December fell 6.6 percent to 3.29 million existing homes available for sale, which represents a 7.2-month supply⁴ at the current sales pace, up from a 6.5-month supply in November. Raw unsold inventory is 11.1 percent below a year ago, is at the lowest level since March 2006, and is 28.2 percent below the record of 4.58 million in July 2008.

Distressed homes, which accounted for 32 percent of sales last month, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes in the same area. For all of 2009, the median price was $173,500, down 12.4 percent from $198,100 in 2008; distressed homes accounted for 36 percent of total sales last year.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.93 percent in December from 4.88 percent in November; the rate was 5.29 percent in December 2008.

Single-family home sales fell 16.8 percent to a seasonally adjusted annual rate of 4.79 million in December from a pace of 5.76 million in November, but are 12.7 percent above the 4.25 million level in December 2008. For all of 2009, single-family sales rose 5.0 percent to 4,566,000.

The median existing single-family home price was $177,500 in December, which is 1.4 percent above a year ago. For all last year, the single-family median was $173,200, down 11.9 percent from 2008.

Existing condominium and co-op sales fell 15.4 percent to a seasonally adjusted annual rate of 660,000 in December from 780,000 in November, but are 34.7 percent higher than the 490,000-unit pace a year ago. For all of 2009, condo sales rose 4.8 percent to 590,000 units.

The median existing condo price⁵ was $183,700 in December, up 1.0 percent from December 2008. For all of last year, the median condo price was $176,100, which is 16.1 percent below 2008.

Regionally, existing-home sales in the Northeast dropped 19.5 percent to an annual level of 910,000 in December but are 21.3 percent above a year ago. The median price in the Northeast was $241,700, up 3.2 percent from December 2008.

Existing-home sales in the Midwest fell 25.8 percent in December to a level of 1.15 million but are 8.5 percent higher than December 2008. The median price in the Midwest was $143,200, which is 1.8 percent above a year ago.

In the South, existing-home sales dropped 16.3 percent to an annual pace of 2.01 million in December but are 15.5 percent above December 2008. The median price in the South was $152,000, down 1.0 percent from a year ago.

Existing-home sales in the West declined 4.8 percent to an annual rate of 1.38 million in December but are 15.0 percent higher than a year ago. The median price in the West was $236,000, up 2.7 percent from December 2008.

# # #

NOTE: NAR also reports monthly comparisons of existing single-family home sales and median prices for select metropolitan statistical areas, and is posted with other tables at: www.realtor.org/research/research/ehsdata. For information on areas not included in the report, please contact the local association of REALTORS ^®.

¹ The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.

Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings. This differs from the U.S. Census Bureau’s series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which generally account for 85 to 90 percent of total home sales, are based on a much larger sample — more than 40 percent of multiple listing service data each month — and typically are not subject to large prior-month revisions.

Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.

² First-time buyer and distressed sales data are from the Realtor ^® Confidence Index; prior month first-time buyer data was revised due to a computational coding issue after the questionnaire was updated to obtain more specific breakouts.

³ The only valid comparisons for median prices are with the same period a year earlier due to the seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if more data is received than was originally reported.

⁴ Total inventory and month’s supply data are available back through 1999, while single-family inventory and month’s supply are available back to 1982 (prior to 1999, condos were measured quarterly while single-family sales accounted for more than 90 percent of transactions).

⁵ Because there is a concentration of condos in high-cost metro areas, the national median condo price generally is higher than the median single-family price. In a given market area, condos typically cost less than single-family homes.

The National Association of REALTORS ^®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.2 million members involved in all aspects of the residential and commercial real estate industries.

 Recently West Michigan, Holland in particular, was selected in a Gallop Poll as being the 2nd best area in the U.S. to live. That doesn’t surprise me with the low cost of living, proximity to “big city” life of Chicago, Detroit, and Grand Rapids.  Hundreds of miles of great lakes coast, thousands of miles of rivers and streams, hundreds of thousands of acres of Federal and State land for the outdoors person, and inland lakes galore. Make this area as close to perfect as one could find.

 West Michigan is also home to some of the most fabulous beaches outside of the Caribbean. White, surgar sand beaches, gorgeous sunsets and tremendous boating are all right here.

 With that said, this area is home to some fantastic beach front properties that are ripe for people just like you who would love to have a wonderful vacation get-away for a fraction of the price of other vacation destinations. With the recent economic whoas that Michigan has experienced as of the past few years, many beautiful beach homes (second homes in most cases) have dropped in price dramatically. Some homes once valued at over 2 million dollars are being sold for under a million dollars. We all know this is a short, temporary down turn but in an effort for many of these second home owners protecting their primary residence is a priority and have chosen to let the banks have their beloved vacation homes back or attempt to sell them via short sales and in some cases, those desiring to sell have realized that the market is forcing them to sell far below previous market value. Long term, what does this mean to you? It means that you can capitalize on one of the best areas in the United States, enjoy beach front living in a spectacular home, experience all the wonders of West Michigan at a fraction of the cost of other locations and in the long term realize tremendous financial rewards. It all adds up to a win-win-win across the board.

 As a local Real Estate professional, I can help you achieve your dreams of luxury and potential future wealth. Call or email me today for a list of potential “dream homes” and I will make sure to get you all the available information including numerous photo’s of all these gorgeous homes. The future belongs to those who are ready to invest now.

Top 10 Cities
1. Boulder, Colo.
2. Holland
3. Honolulu, Hawaii
4. Provo, Utah
5. Santa Rosa, Calif.
6. Santa Barbara, Calif.
7. San Jose, Calif.
8. Washington, D.C.
9. Ogden, Utah
10. Oxnard, Calif.
From Gallup-Healthyways Well-being Index

 This news was just released from the AP. What a tremendous statement to think that where I chose to call home and do business is one of the greatest places to live in the United States. Further investigation showed also that the cost of living is 74% LOWER than the #1 City. What better place to call home and raise a family.

 Gotta LOVE WEST MICHIGAN

I have been watching a few shows on the Discovery channel and am amazed at the awesome tips I have gotten from some of these.

Obviously in today market, flipping a house is scary at best but, the same basic themes can be applied to any house for sale.

1st. De personalize your house. Buyers want to visualize THIER things in the house so take down any family photos, trinkets that no one else will under stand and basic clutter.

2nd. The house has to look fresh and neutral. If pink is your favorite color, that’s wonderful. When you buy your new house paint anything you like pink but, when you are marketing your house paint over the pink with a neutral color like off white or light beige.

3rd. Clean your closets. You are going to move soon so use this opportunity to box away seasonal items. If you are selling in June, you can get rid of snow boots, ski jackets and so one. Not only will it make you r house and closets look bigger it will save you time when you actually have to get out of the house.

4th. Make sure that everything is working properly. Take the time to make sure sinks aren’t dripping, holes in dry wall are fixed, all light bulbs are working. Is there a hol eof stain in the carpet, replace it. Witha cheap, nuteral reminent.

Basically go through the house like a buyer would. Have a friend come over and critique the place. Make sure your honest with yourself. Just like at a middle school dance, the prettiest girl gets asked to dance first. Same holds true when buyers are looking at houses.

It may cost a few bucks up front to make it show ready, but when you figure in a 2 1/2% per month carry cost, often times that investment can be made up in the first month that you actually have the house sold and NOT for sale.

Many people have taken advantage of the Federal Tax credit for first time buyers and those who have not purchased Real Estate in the past 5 years. Well, I would suggest that the time to get serious is NOW. We are almost though Feb. and to enjoy the Tax Credit you MUST have an accepted offer on a property before April 30, 2010. With new restrictions in mortgage lending a delay in applying for pre-approval could potentially cost you thousands in tax savings not to mention a looming ride in interest rates and the chance that a home of your choice could be sold before you are in a position to buy. Give me a call or shoot me an email to get started. You have nothing to lose and everything to gain by acting now.