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For information in French about Florida Real Estate, (Information en Français sur l'immobilier en Floride) please CLICK HERE.

The Florida Realtors urged members of Congress on Friday to pressure banks and other lenders to quickly accept “short sales” of homes to help prevent the spread of foreclosures.

They said short sales – in which properties are sold for less than what is owed to lenders – would speed up real estate transactions and get Florida’s economy moving again.  The realtors pushed for a federal pilot project in Florida to establish a statewide electronic marketplace of properties, listing pre-approved short-sale prices.

The realtors also promoted a bill sponsored by Congressman Tom Rooney, a Republican from Tequesta, which would force lenders to accept or reject proposed short sales within 45 days. If lenders do not respond, the short-sale request would be considered approved.

Their briefing came with a dire housing forecast.

“Half of the mortgages in Florida are `underwater:’ the value of the property is less than what the mortgages are,” Patricia Fitzgerald, president of the realtors group, told the Florida congressional delegation. “Sales are up, but median prices are down, especially in South Florida.”

“Simply put, Florida needs a better way to sell more homes faster,” she said.

Several Florida members at the briefing said they wuld consider sending a letter to the Treasury Department and Federal Housing Finance Agency urging creation of the electronic marketplace.  The realtors said lenders have been slow to react because they are overwhelmed by the demand for short sales and are not set up to work with homeowners to complete these transactions. But Louis Spagnuolo, vice president of mortgage banking at WCS Lending of Boca Raton, said many lenders have been reluctant to complete short sales because that would mean taking a loss.

“They are still hoping that if they hold on long enough, property values will increase and they can make more money on them,” Spagnuolo said. “But by holding this shadow inventory off the market, it just prolongs the inevitable.”

He said an electronic marketplace with pre-approved short-sale prices “would make the market much more fluid and functional.”

The Sun Sentinel - May 13, 2011

The Consequence of Walking Away

An estimated 11 million home owners owe more on their mortgage than their property is currently worth. That’s made more home owners consider walking away from their mortgage and home ownership, even those who can still comfortably afford to make their payments (known as “strategic default”).

Walking away from a mortgage usually results in either a short sale or foreclosure. So what are the consequences of walking away? There may be far more consequences than what most home owners ever considered.

The consequences include everything from badly affected credit to potential tax consequences and deficiency risks. There are even possible professional implications, Justin McHood with Academy Mortgage in Chandler, Ariz., warns in an article at Zillow.com.

Home owners' credit scores will be badly hit regardless of whether they attempt a short sale or have their property foreclosed on. (See How Missed Mortgage Payments Hurt Credit Scores)

There also could be the potential for deficiency risks when walking away from a home, which largely varies from state to state. (View anti-deficiency laws by state.) In some states, lenders may sue you for the difference between what you owe and what your short-sale or foreclosure proceeds are, McHood notes.

Home owners considering walking away also should weigh the potential difficulty they may face from moving too. For example, if moving into a rental property, they’ll have to convince a landlord to rent to them after they have the red flag of missed mortgage payments on their credit record. And paying for moving expenses — which many walkaways fail to consider — can quickly add up too.

Plus, home owners may find professional consequences from walking away from a mortgage, as the number of employers eyeing employees’ credit profiles continues to grow.

From  Zillow.com (April 27, 2011)

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Consumers see mixed outlook for housing

WASHINGTON – Sept. 16, 2010 – Fannie Mae’s latest national housing survey finds that most Americans believe the housing market has reached bottom, but they are more cautious about owning a home. Respondents to the Fannie Mae National Housing Survey believe that home prices will hold steady (47 percent) or increase (31 percent) over the next year, and that rental prices will stay the same (46 percent) or go up (39 percent). Across the general population, the average expected rise in rental prices is four times that of home prices (3.6 percent versus 0.9 percent).

Seventy percent of Americans think it is a good time to buy a house, compared with 64 percent in a similar survey conducted in January 2010. But 33 percent – up from 30 percent – of all respondents said they would be more likely to rent their next home if they moved.

“These findings indicate a return to a more balanced and realistic approach toward housing,” said Doug Duncan, vice president and chief economist, Fannie Mae. “While this will likely weigh on the housing recovery in the near-term, it should, over time, help to build a stronger and healthier market focused on sustainable homeownership. Homeowners and renters alike continue to be wary of taking on risk, and they are less confident in the long-term outlook for housing.”

A majority of Americans (67 percent) continue to believe that housing is a safe investment; however, that number is down 16 percentage points from a similar survey conducted in 2003 – the largest drop by far among all investment types tracked since then. Delinquent borrowers and renters are notably more discouraged than mortgage borrowers and underwater borrowers about a home’s safety as an investment and the appeal of buying versus renting. More than 70 percent of all respondents believe it will be harder for the next generation to buy a home, up three points from the beginning of the year.

The Fannie Mae National Housing Survey polled homeowners and renters between June 2010 and July 2010. Findings were compared to a similar survey conducted by Fannie Mae from December 2009 to January 2010 and released in April 2010, and a similar survey conducted in 2003.

Overview of key findings

• A large majority of Americans (78 percent) believe that home prices either will remain flat or go up over the next year, up five points from the beginning of the year. Forty-seven percent believe prices will hold steady, while 31 percent think they will go up. This is a notable shift from January 2010, when these numbers were 36 percent and 37 percent, respectively.

• Thirty-nine percent think rental prices will increase over the next 12 months, while 46 percent said they would stay the same.

• Consumers continue to believe it is a buyers’ market; 70 percent said it is a good time to buy a house, up six points from January. However, 83 percent believe it is a bad time to sell a house.

• A majority of Americans (67 percent) continue to believe that buying a home is a safe investment, although this is down three points since January and 16 points since 2003. Housing ranked second behind putting money into a savings or money market account (76 percent).

• Fifty-four percent think it would be very difficult or somewhat difficult to get a home loan today, down six points since January. However, 71 percent of Americans think buying a home will be harder for the next generation, up three points since January.

Consumers continue to be cautious in housing decisions

• The number of respondents who said they would be more likely to rent rather than buy their next home if they were going to move increased from 30 percent in January to 33 percent in July.

• A majority of renters said they would be more likely to rent their next home if they were to move, increasing significantly from 54 percent in January to 60 percent in July, even though 69 percent of renters think it makes more sense to buy a home.

• Twenty-two percent of mortgage borrowers said they have reduced their mortgage debt significantly in the last year, and 27 percent of mortgage borrowers say they have reduced their non-mortgage debt significantly.

Views on homeownership diverge among sub-groups

• Mortgage borrowers (74 percent) and underwater borrowers (69 percent) are more likely to say owning a home is a safe investment than delinquent borrowers (57 percent) and renters (54 percent). However, this measure has fallen among all sub-groups since January, with delinquent borrowers and renters showing the largest declines, down eight and seven points, respectively.

• Mortgage borrowers (83 percent) and underwater borrowers (77 percent) said they are more likely to buy in the future than rent – both groups increased two points from January.

• The number of renters (37 percent) and delinquent borrowers (52 percent) who said they are more likely to buy in the future declined by seven and four points from January, respectively.

Economic and housing attitudes among minority respondents

• Forty-eight percent of African-Americans and 36 percent of Hispanics believe the economy is on the right track, compared to just 30 percent of the general public.

• Seventy-one percent of African-Americans and 58 percent of Hispanics expect their personal finances to get better over the next year, compared to 44 percent of the general public.

• African-Americans (65 percent) and Hispanics (72 percent) believe that obtaining a home mortgage today would be difficult, compared to 54 percent of the general public.

• African-Americans (75 percent) and Hispanics (76 percent) both still believe that owning a home is a good way to build up wealth that can be passed along to their families, compared to 58 percent of the general population.

A fact sheet containing a complete set of the survey’s key findings can be found (PDF format) at:

Fannie Mae National Housing Survey Fact Sheet.

From FloridaRealtors.org

Sept. 15, 2010