This might seem a bit far fetched but it is it anymore far fetched than what the national news is reporting?  The balance of what they tell us is stilted to the story they want to report.  Facts may not be all that important and the numbers they use doesn’t always match the reality of a particular neighborhood.

It is true that the mailman might know who is getting the foreclosure notices but they don’t know how much the houses in the neighborhood are selling for.  They don’t know what concessions the lenders are willing to provide to get a home sold.  They don’t know how to write a contract that protects your interests and they don’t know how to connect you with the right lender.  That is where buyers need the help of a Realtor® who is in the trenches everyday.

If you don’t want to be charged with stalking the mailman trying to find the next foreclosure in your favorite neighborhood call a Realtor®.  They will be there to prtoect your interests and make sure that you don’t have to be out in the rain, sleet and dead of night to make it happen!

Having recently posted about New Urbanism in Northern Virginia it was interesting to see the WBJ cover some of the same thoughts expressed in my post.  Stating that Gen X and Gen Y buyers are looking to finding live, work and play neighborhoods with good transportation options to Washington DC.

Occoquan was selected due to its historic charm and it’s location between Fort Belvoir and Quantico.  In addition to the Town of Occoquan itself the WBJ recognized Belmont Bay and Lorton as smart growth developments which are contributing to the success of the area.  With multiple Virginia Rail Express stations close by, the area is ready to grow with the new jobs (BRAC) slated to move to the area.

As a member of the Occoquan River Communities it is nice to see our vision for the area being recognized.  We are meeting with economic developers and community leaders to continue our mission of making Belmont Bay, Lorton and the Town of Occoquan  the next destination that residents of Northern Virginia will want to call home.

Even though the press likes to focus on the negative on aspects of the market the buyers who are out today are not flip and run investors.  It is also interesting to notice the distribution of price ranges.  The majority of the sales aren’t at the lowest price point of available homes but closer to the mid-point of prices. 

Sales over $500,000 are still happening and the majority of the homes sold in this price range are the newer homes in the western Prince William County cities of Bristow, Gainesville and Haymarket.

The price volume of sales is up 22.5% from the same time in 2007 and the number of homes sold is up 95.5%.  This is as always tempered with the fact that average sold price is down 37.3%.  The majority of new loans used to purchase properties were FHA and VA and there were 52 all cash transactions recorded in the MLS as well.

The sales numbers this fall are going to be the one that we are going to be looking be paying close attention to.  With the changes in the FHA loan programs, the elimination of the down payment assistance programs and how first time buyers view the $7500 tax credit will begin to be reflected in our sales in late September and October.

For now buyers who have been sitting on the fence have an opportunity to make a grab for homeownership in an area that is offering some of the best values in Northern Virginia.

None of the listings for these properties mentioned mold and there were no notices published on the properties or at least on doors leading to the basement.  None of the listing agents thought it was important to warn potential buyers that they were being exposed to a toxic situation and none of the agents provided masks at the property to help protect potential buyers from exposure to an unhealthy situation.

Now many will blow this off and say listing agents shouldn’t be worried about the health of prospective buyers or other agents.  Perhaps this is true but there are agents who do list in the MLS that the home has mold and to enter at your own risk.  Those agents are smart enough to realize that mold is a serious health issue and understand the potential of liability if they don’t warn others about the risk. 

So the questions raised after yesterdays experience are:

When agents are doing the pre-listing BPO do they check the box that says “environmental hazards” when they find the presence of mold? 

Should banks be required to do mold abatement prior to listing a property?

Should agents as representatives for the banks be required to disclose environmental hazards to prospective buyers in the MLS listing?

How long will it be before an agent is the target of a board complaint or a lender sued by a prospective buyer for not disclosing the presence of mold in a home?  

My foreclosure tool kit that rides in the trunk of my car is now expanding.  Besides the hand sanitizer, flashlight and flea spray it is now going to include disposable masks as well.  I know well enough that I need to protect my clients.  Hopefully other agents will realize that they need to protect them as well.

Yesterday while showing Northern Virginia foreclosures we caught a glimpse of where thousands of dollars can go instead of toward the mortgage.  Rooms full of discarding magazines.  Suitcases full of magazines.  Bookshelves full of magazines.  With the cost of these magazines averaging about $6.00 a pop it didn’t take long to see at least one mortgage payment that had been spent at the local bookstore.

Looking at all of the money wasted in this home made me wonder about credit counseling.  Not the late night we can fix your credit type of counseling but true budgeting and accountability type of credit counseling.  How many families who are facing foreclosure are getting any type of help to look at where their money goes?  Actually the answer is fairly obvious, very few of them.  

Part of the new Foreclosure Prevention Act of 2008 included a provision for pre-foreclosure counseling funds:

“S. 2636 would help to keep struggling families in their homes by:

  ·     Increasing pre-foreclosure counseling funds.  Title III of S. 2636 would provide $200 million in additional funding that would help housing counselors continue their outreach to families at risk of foreclosure.  These added funds would help as many as 500,000 additional families connect with their mortgage servicer or lender to explore options that will keep them in their homes.”

This is one of the parts of the new Foreclosure Act of 2008 that makes good sense but there are some serious unanswered questions.

How are the lenders going to connect with homeowners to let them know about the service? 

Once an owner is in the counseling program will the lenders extend the timeframe before foreclosure to try and give them time to work out their finances?

The amount in the bill that was set aside for the counseling isn’t nearly enough to make an impact for the families who need help now.  However if the lenders and the housing counselors work hand in hand perhaps a few families might be able to stay in their homes and learn that spending thousands of dollars on magazines is not good money management.

So here is the scenario.  What would you have done?

My clients and I attempted to view a house that was #1 on our must see list.  There were keys in the combination lockbox that worked one lock but not the other. Then I spied an electronic lockbox and discovered a different key inside.  That key fit the backdoor locks but didn’t open the door.  After all three of us tried to open the door with no success I put in a call to the agent (got VM) and we decided to head on to view other properties.  When we didn’t get a return call from the agent we decided to call it a day and hopefully be able to see the property the following day.

On a whim, after grabbing a bite to eat my clients drove back by the property and saw someone coming out the front door.  They stopped and said they had been by earlier with their agent but couldn’t get in.  The agent said they couldn’t get in either with the keys but her client found an unlocked window, crawled in and came around and unlocked the door.  The agent then handed my clients the keys and LEFT!  Drove away, gone, bye-bye.

My clients called me and said “guess what we are in the house.”  When they explained how they had gained entry I told them to leave.  We figured out how they could lock the house for us to get back in and arranged to meet back at the property in an hour. 

I don’t know if the other agent had tried the electronic lockbox so there might be a record of who it was but I’m shocked that an agent would just casually drop the keys to a property into two stranger’s hands and walk away without any concern whatsoever.

No matter how much my clients want to see a house I’m never going to resort to breaking and entering.  I’m will never hand over keys to someone without an agent who just shows up at the door of a house no matter what their story.  This agent can count themselves lucky that my clients did the right thing.

Combination lockboxes with the code in the MLS provide no way of tracking who has been in the property.  This is eventually going to lead to a serious incident.  Hopefully our local boards and the lenders who suggest the use of them will wise up and put a stop to the practice before it does.

When an agent goes to meet with a prospective seller to talk about listing their home it would never cross the sellers or our minds to suggest that we will have all of the utilities transferred to our name to make it easier for the owner. Nor would we agree to take on the responsibility for cleaning their home or keeping the yard mowed. However, every day lenders are asking agents to do this and agents are saying YES.

Why? We don’t own the property or have any financial interest in it and still agents are willingly taking on the financial burden just because the banks ask them to. Many agents I’ve talked to who handle a large numbers of foreclosures are shelling out thousands of dollars in expenses to maintain a property. In some cases reimbursements are slow and if work needs to be done they are required to call the lenders “preferred” contractor. If an emergency repair is needed and the preferred contractor isn’t available they risk not being reimbursed by the lender unless they can verify the gravity of the emergency.

On top of the out of pocket expenses, the listing agent often has to wait until the end of the transaction to find out if the lender is going to ask them to reduce their commission to help the lender meet their NET. How did this trend start? Was it one agent who said yes and then the banks began to play the other agents one against another for a cut of the business? Was it an entire brokerage that agreed to it and then everyone else had to follow suit?

If lenders require that the utilities be on (at minimum electricity should be on for safety reasons) then why don’t they set up corporate accounts with the major utility companies in the area where they have large pockets of foreclosures? Why don’t they have a direct 30 day billing cycle with their approved contractors? Why are they relying on agents to take on the accounting and financial burden of selling their properties for them?

The practice is contradictory to our own listing agreements and yet hundreds of agents across our area are willingly taking on the burden. It shouldn’t be a Realtors® responsibility to go into debt in order to sell a foreclosure listing. Wouldn’t it be better if ONE MILLION plus Realtors® would stand up and say “we’re mad as hell and aren’t going to take it anymore” and let the lenders take the responsibility of paying the bills on the properties they own?

Delinquencies and foreclosures are sapping associations of much needed income to keep current on the everyday bills.  A few years ago condos in Arlington and Alexandria were flying off the market faster than they could be built.  Unfortunately among the buyers who were excited about a new home close to the metro there was a large group of investors out to make a few dollars with a quick flip.

 When the market made its dramatic turn the first properties to be hit were condos.  Hundreds of flippers suddenly found themselves with units worth less than the paid for them even at pre-construction prices.  So what is the first thing they stop paying?  They stopped paying the condo dues resulting in large deficits for the associations.   Associations in desperation to try and collect some of the dues hire attorneys to put liens on the condo in hopes of collecting some of the past due funds.

However this just adds to the money worries by larger legal bills.  Putting a lien on the property isn’t going to do the association any good.  When the property goes to foreclosure there isn’t any money to pay the back dues and the lender isn’t responsible for any past dues.  When the property is sold the lender will pay the dues from when they owned the property but while it sits on the market the debt continues to rise.

For a buyer today looking at a condo purchase they need to pay careful attention to the association budget.  They need to make sure that the see the latest budget that shows the real numbers.  Most lenders will not pay a special assessment and a buyer could get a surprise after closing to find themselves with fees to be paid that they weren’t expecting.  Today’s market is full of twists and turns.  A special assessment because your neighbors aren’t paying their bills is a new one to watch out for.

I just finished reading the umpteenth blog on how real estate agents should be marketing themselves as short sale specialists in order to generate more business.  As an agent who has successfully completed a few short sales and have a few more in the works it seemed this might be a good time for a reality check.

Going back over the call logs on my current short sale listings started me thinking of all of the other components connected to a short sale that an agent stepping into their first short sale may not consider.

Time spent gathering and reviewing the short sale package
Time on hold with the loss mitigation department
Time on the phone with the loss mitigation department
Time spent of the phone with the negotiator
Time spent of the phone with the appraiser/BPO agent
Time on the spent with agents answering questions
Time on the phone with  buyers explaining a short sale
Time spent talking to buyer’s lenders
Time spent gathering HUD-1’s to go with offers
Time spent processing offers

Notice the list doesn’t include the normal tasks associated with a listing which are required in order to attract buyers.  Those tasks need to be added on top of the time spent specifically on short sale tasks.  Add on top of this the fact that lenders are notorious for slashing commissions at the end of the negotiations process and an agent working with a short sale may find that instead of making X commission they are only getting Y for all of the extra hours of work. 

Considering the National Association of Realtors® shows that the average agent earns $35,000 per year, deciding to be a short sale specialist means an agent seriously needs to consider the old adage time is money.   Agents, especially newer agents, who might be considering advertising themselves as a short sale specialists might first want to get out their calculators and figure out the value of their time.  You may be surprised that the time it takes to finish a short sale transaction only leaves you enough to fill your car with gas and not much more.

So off we went for what we thought would be a simple run to the grocery store.  As soon as we pulled into the parking lot I was ready to run the other way.  But I was outvoted and in we went.  It was HUGE.  I’m talking MEGA.   And it was crowded.  I can’t remember the last time I saw that many people at the grocery store at one time.  Especially on at noon in the middle of the week.  Don’t these folks have jobs somewhere?

Could I find goat cheese?  Yes about 10 varieties.  Could I find seafood?  Absolutely and some of it was not anything I had ever seen in this part of the world before.  Vegetables including the “dreaded” tomatoes, with “it’s okay to eat these signs”, were front and center.  The list of what you could find or not because the store is so big is incredible.

Despite my protests we managed to spent time checking out what we might want to eat should we want to get a bit more exotic than our easy and light summer cooking.  The thought did cross our minds to pull up a chair at the seafood bar and have some oysters but we grew up with the mindset that you don’t eat oysters in a month without an “r” in it so we passed.  Plenty of other folks were filling up the chairs both at the seafood bar and at the outside patio with prepared sandwiches.

So what is this new and extraordinary addition to Prince William County?  It is Wegmans.  Part of the new and upscale stores planned for the Shops at Stonewall situated between Route 1 and I-95 off of Nebesco Road.  If the crowds at Wegmans are any indication of how long the residents of Prince William County have waited for the store to open, then the county planners have made the right decision. 

It might take me a little while to get up the courage to fight the crowds again.  In the meantime we have enough food to keep us happy for awhile.