Forclosureradar.com posted its most recent findings today indicating that Bank Owned inventory continues to tighten. Furthermore the report indicates that California is among the high foreclosure activity states that is seeing a slowdown in foreclosure inventories. Santa Clara County bank owned inventories have slipped to a new low of 1939 for February 2012 as compared to the previous year.
Bank Owned
Bank owned activity has certainly made it easier for investors to benefit from the foreclosure activity while first time home buyers have had little luck in competing with investors to pick up these opportunities. The map below shows the bank owned inventory as of today for the City of San Jose alone. There are more than 7,000 properties that are 90 days or more in the foreclosure process for Santa Clara County.
Impact on your home search
For this reason I continue to think that short sales are the best opportunity for patient home buyers who want a good deal and are willing to work within the constraints of short sale timelines.
Relates article:The Foreclosure Report – February 2012
The California Association of REALTORS® have released the affordability numbers for the state of California and among them is the very expensive bay area and Santa Clara County is among them. Here is what they found.
- In Santa Clara County only 37% of the population can afford to buy a home at the $545,000 median range.
- The required take home to purchase is $117,630.
- Your monthly payment will be around $2,940.
The Chart below shows the cost of home ownership in California.
The Department of Real Estate has made a shift in their staff workload from licensing to fraud prevention and protection of the pubic. One of the areas that has become a priority has become short sales and how licensees are offering services to the public to deal with short sales.
A trend that has become an issue has been buyers who entice listing agents to submit their offers only to the lenders for approval. The issue is with regard to agency(who the agent represents in the transaction) and it can create a legal problem with the listing agent and the homeowner. The banks want the best offer the market supports. Flippers are more likely to make an offer lower than a competing offer. This presents a problem for the homeowner and the listing agent. Homeowners must submit highest and best to protect themselves.
Negotiators must be licensed
The primary requirement for negotiating a short sale is that the individual performing the negotiation must be a licenced real estate Broker or a salesperson supervised by a broker. Sellers must verify the negotiators licence status on the DRE website dre.ca.gov.
Paying a Short Sale negotiation fee
A listing agent that requires the buyer or buyers agent to agree to pay a short Sale negotiation fee on behalf of the seller is in violation of real estate law. An update published in September goes into detail regarding this issue. ConsumerAlert_ShortSalesUpdate
The DRE has recently issued a consumer alert with the intent to assist homeowners navigate through the short process.
DRE_ConsumerAlert_ShortSales
The California Association of REALTORS latest report tracks entry level housing requirements for the state of California over the second quarter of 2010. Santa Clara County has slipped slightly in the affordability index from 55% in Q1 2010 to 51% in Q2 2010.
The report also tracks income requirements for entry level housing and monthly principal, interest, taxes, and insurance (PITI) payments a buyer should budget towards housing. A first time home buyer would need to make a PITI payment of $2,940. This is taking into account a Santa Clara County median purchase price of $535,500.
Read report here
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