Discussing the negative impact of abandoned or vacant homes, Fannie improves financing options for manufactured homes, an interesting survey about if it is a good time to buy or sell a home and how the internet hasn’t changed real estate in one very important way…
The Negative Effect of Abandoned and Empty Homes
From Alan Mallach at the Lincoln Institute of Land Policy:
Most vacant houses are well maintained, but many are a problem. Thousands sit empty for years, abandoned by their owners, deteriorating to the point where they cannot be reused without major rehabilitation. Many ultimately are demolished, leaving vacant lots in their place.
Vacancy and abandonment are not only urban problems. Rural areas and small towns have a vacancy rate nearly double that of metropolitan areas; rural vacancy problems are particularly severe in many parts of Appalachia, the rural South, and the Great Plains states.
The challenge of vacant property is inextricably linked to the larger social and economic challenges of the neighborhoods, cities, and regions in which vacant properties are concentrated. Vacancy will continue to be a problem as long as millions of Americans, particularly people of color, live in abject poverty in urban, suburban, and rural areas that are experiencing little or no gain from our nation’s overall prosperity. That said, we have seen that constructive, strategic action by the public and private sectors can reduce both the number of unproductive, blighted vacant properties and the harm they do to the quality of life and future economic prospects of the most struggling towns and cities.
After the housing market crashed, we saw an increase in what became known as zombie foreclosures. This is when the bank forecloses and the person being foreclosed on moves out. But then the bank for some reason never does anything with the property.
Then the home sits neglected for years or forever. Often without the taxes paid and dragging down the values of the surrounding properties.
If the taxes are not being paid, this means it hurts our local government to fund things such as schools and law enforcement. Which is obviously pretty important…
Plus it will hurt the values of the surrounding properties because eventually, the property will become an eyesore. Potential buyers normally check out the surrounding area and a vacant run down home will turn most buyers off!
Zombie foreclosures are not the only source of abandoned or vacant homes. The number of abandoned or vacant properties in our area is not as great as places such some of the cities in the Rust Belt.
However, we must make sure that this problem is addressed. In our area, one great way to handle an abandoned or vacant property is by reporting any code or zoning violations to the County.
Fannie Mae Improves Manufactured Home Lending
Fannie Mae has started a new program called MH Advantage that is supposed to help expand the options for getting a mortgage on a manufactured home. Which sounds great but it appears it is ONLY for new homes bought at a dealership.
So if you are looking at buying an existing mobile home, you may still find your mortgage options limited. However, if you are thinking about buying a new manufactured home check out some of the highlights of MH Advantage:
- Only 3% down payment
- Fannie is not charging the 50-basis-point loan level price adjustment that usually applies to manufactured housing loans
- Traditional 30-year fixed rate financing
- Lower interest rates than most traditional manufactured home loans
- Cancellable mortgage insurance
So this will help with the sales of NEW manufactured homes. And with the extremely low level of affordable homes being built, this could help some home buyers.
I strongly suggest that anyone thinking about a manufactured home do plenty of research BEFORE visiting a dealership OR signing any paperwork. There could still be problems when it comes time to sell or refinance.
You can find out more by reading Take the MH Advantage Challenge – Can You Tell the Difference?
Scammer Gets Banned from Debt Relief Business
Benjamin R. Horton is banned from the debt relief business under a settlement with the Federal Trade Commission for his role in a mortgage relief scheme that falsely promised financially distressed homeowners foreclosure prevention and more affordable mortgage payments.
According to the FTC, the operation typically charged consumers $3,900 in unlawful advance fees and touted a 98-100 percent success rate. The defendants, typically operating as Preferred Law PLLC, Consumer Defense LLC, or American Home Loans, allegedly used doctored government logos, falsely suggesting they were affiliated with or endorsed by the federal government’s Making Home Affordable loan modification program.
The list of stuff this person did is pretty long and it sounds like he hurt lots of people. If you or someone you know is facing foreclosure or having a tough time do plenty of research.
One of the biggest red flags is if someone asks for money upfront to help you with a mortgage modification. One place to start learning about avoiding scam artists is at Making Home Affordable
Good Time to Sell a Home?
Highlights from Fannie Mae’s latest Home Purchase Sentiment Index:
- The net share of Americans who say it is a good time to buy a home decreased 1 percentage point to 28%
- The net share of those who say it is a good time to sell a home rose 1 percentage points to 46%
- The net share of Americans who say home prices will go up in the next 12 months is unchanged from the prior month at 49%.
Doug Duncan, senior vice president and chief economist at Fannie Mae, said that increasing home prices are the reason for the increase in home buying sentiment.
While higher home prices are great for sellers, the combination of higher prices, rising mortgage rates and low inventory levels is hurting home sales. It isn’t impossible to buy a home now but for those that wait, it may get more expensive.
Real Estate and the Internet
Redfin, Zillow, and Opendoor want to transform homebuying—but there’s one thing they can’t change.
Between the housing crash, the subsequent housing crisis, and the unshakeable ascent of real estate reality TV, the past decade has so fundamentally changed the way Americans think about buying and selling homes that it’s easy to forget that the way we actually buy and sell homes is the same as it ever was.
For sellers: hire an agent, do a little renovation, list, and wait. For buyers: hire an agent, traverse open houses, make an offer, and wait.
Interesting to read this just after we had the FTC and DOJ start looking at the real estate industry again. While there have been big changes in real estate, most people still want and/or need the help of an expert when buying or selling.
Technology is great but I do not see the need for GOOD, ETHICAL and EXPERIENCED REALTORS ending any time soon. There will always be those DIY people that insist you can “save the commission” but the success stories are not the norm…
Most people STILL find that using a Realtor when buying or selling is the best option. As with most things, using an expert is always a good option.
Well that is all for today! Be sure to check back tomorrow as I plan on covering this week’s mortgage rate reports plus any other goodies that show up between now and then!