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Best September for home contracts

October 11, 2013 by

 

Best September for home contracts

YTD closings. Source: Gary Bauer, Metrolist.

YTD closings. Source: Gary Bauer, Metrolist.

You don’t have to tell Lydia Lin that last month was a record September for home sales activity in the Denver area.

Last month, she put about 10 homes under contract in as many days, despite being on vacation for five of those days.

“It’s crazy,” said Lin, owner of One Realty in Denver. “I’ve sold almost 50 homes this year, while in all of last year I sold 32.”

Reports by independent broker Gary Bauer and Metrolist showed 5,337 homes were placed under contract in September, the best September on record.

A total of 4,730 homes were closed, the third best September for closings. Closings reflect homes that were placed under contract in previous months.

Bauer said some Realtors he talked to, like Lin, had a fantastic September, while others saw a steeper than normal decline.

Indeed, while contracts were up 19.7 percent from a September 2012, they were down 16 percent from August, which also was a record, with 6,353 contracts being written.

Closings showed the same trend, falling by 16.1 percent from August, but rose 19.8 percent from August 2012.

Part of the drop was the normal seasonal decline, which likely will continue for the rest of the year, Bauer said.

Lydia Lin

Lydia Lin

“Right now, we’re still seeing a lot of activity in hyper-local neighborhoods like West Highland, LoHi, Berkeley, Sunnyside and other neighborhoods,” Bauer said. “What is happening in Berkeley is just amazing.”

Also, he and others said if the governmental shutdown continues, it also will hurt the market more than normal.

Lin said September started out slow, but picked up in the middle of the month when mortgage rates fell.

“It seems like the last couple of weeks, things are just going kind of gangbusters,” she said.

Falling rates have been key, said Peter Niederman, CEO of Kentwood Real Estate. Read full article here

 

John Marcotte

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RE/MAX stock soars another 12%

October 10, 2013 by

 

RE/MAX stock soars another 12%

The trend continues.

Denver-based RE/MAX has been trading on the New York Stock Exchangefor two days and both days it has been the second biggest percentage gainer on the NYSE.

It went public at $22, higher than the expected $19 to $21 per share. RE/MAX issued 10 million shares, raising $220 million.

On Wednesday, it closed at $27, a 22.7 percent first-day gain.

Today, it gained another $3.21, for an 11.89 percent jump, on a day that the S&P 500 and the Down Jones Industrial Average each fell 0.9 percent.

Since the franchise real estate company started trading, it has gained 37.3 percent. Some 2.45 million shares traded today. It traded as high as $31.08 today.

Not everyone is a fan of the stock, which trades under the symbol RMAX.

CNBC commentator Jim Cramer called it a “sell.”

Given the state of the economy, a falling equities market, and  a potential debt default that could be a disaster for the real estate market, Cramer was baffled why the IPO of RE/MAX went so well.

Cramer said he would prefer to avoid investing in a newly publicly tradedcompany at this time, or in the real estate sector. RE/MAX, of course, is both. Cramer said he feels he is one of the few who is properly factoring in the potential downside to the shares of RE/MAX.

RE/MAX was founded in Denver in 1973 by Dave and Gail Liniger. They remain the largest shareholders, owning 61 percent.

Read entire article here 

 

John Marcotte

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September – 2013 Real Estate Market Stats

October 9, 2013 by

September – 2013 Real Estate Market Stats

The leaves are changing, the temperatures dropping and there is a slight uncertainty on how the last three months of 2013 will progress. One thing that is certain is that the housing market in Colorado is still very strong and record numbers continue to be the trend each month.

Wishing you a colorful October!

September – 2013 Real Estate Market Stats

Residential Sales

Entire MLS (All Areas)

Residential Highlights:

  • 18% increase in the number of closed sales year-over-year
  • 20.2% increase in the number of closed sales year to date
  • 39.1% decrease in average days on market (39 days in September)
  • .7% decrease in # of active listings
  • 11.4% increase in # of new listings (4097 new listings in September)
  • 8.1% increase in average price – sold ($331,382 in September)

Condo Highlights:

  • 26.7% increase in number of closed sales year-over-year
  • 26.8% increase in number of closed sales year to date
  • 42.2% decrease in average days on market (37 days in September)
  • .7% decrease in #  of active listings
  • 7.1% increase in # of new listings (968 new listings in September)
  • 11.5% increase in average price – sold ($208,364 in September)

Click here for Full report of entire MLS

Courtesy of Land Title

 

John Marcotte

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Resort roller coaster leads to suit

October 8, 2013 by

Resort roller coaster leads to suit

A drawing of what some Beaver Creek residents are calling a mountain roller coaster.

A drawing of what some Beaver Creek residents are calling a mountain roller coaster.

An entertainment center that would include what is being called a “mountain roller coaster,” prompted some residents of in Beaver Creek to file a lawsuit against Vail Resorts.

Vail Resorts, which owns Beaver Creek and is developing the center, announced last week it had started construction on new recreational activities on private land it owns above what is called the Ranch and is accessible by the Buckaroo Express Gondola.

The recreational amenities include what it is calling the “Forest Flyer,” which will be tobaggans on steel tracks with curves, circles and dips.

Opponents call it a roller coaster at a mountain amusement park on a mountain facing Beaver Creek Village, as close as two blocks of some residential neighborhoods.

However, Beaver Creek remains undaunted by the suit filed by the Beaver Creek Property Owners Association and the Greystone Condominium Association.

“Beaver Creek is committed to providing new activities for kids on a year round basis that allow families to enjoy the beautiful and iconic nature of our mountain while also having fun and exhilarating experiences,” said Doug Lovell, chief operating officer, Beaver Creek Resort.

“Beaver Creek has a 30-plus year track record of industry leading guest service and doing so in a way that always delivers on our brand promise,” Lovell continued.

He said the planned activity center followed a “very public process.”

The neighbors suing Vail Resorts find little to like about the development.

Permanently “scar” mountain

“We believe an amusement park complex is not appropriate for a setting like Beaver Creek, where the rides will permanently scar the face of the mountain and alter the character and beauty of this valley for both residents and visitors,” said Tim Maher, president of the board of the Beaver Creek Property Owners association board of directors.

“The amusement park rides would be a distance of less than two football fields from the closest homes and well within sight and earshot of many homeowners’ bedroom windows,” he said.

The new amusement rides proposed at this point, opponent contend, include a roller coaster operated year-round, a ropes challenge course/zip line, a summer tubing hill and an operations building to support the roller coaster.

The roller coaster would run on a one-half mile long steel track, also requiring the installation of 2,000 feet of safety fencing with the help of a fence contractor and nearly 3,000 feet (10 football fields) of structural metal.

The BCPOA alleges that in addition to marring the view of almost every home with a mountain view in the valley, the proximity of the roller coaster to homes would generate year-round noise given its capacity of accommodating up to 500 riders per hour.

“Most people would agree an amusement park is not a good fit and very off-brand for Beaver Creek, which Vail Resorts markets as a premiere, world-class resort,” said Barry Parker, vice president of the BCPOA board. “The roller coaster proposed at Beaver Creek would be the only installation of its kind this close to residential areas in any U.S. mountain resort.”

“The vast majority of coasters in the U.S. are installed at amusement parks or water parks, not luxury resorts.”

He also raised environmental concerns.

“Based on our review of the plans, construction of an amusement park complex at Beaver Creek would also result in significant environmental damage, including the removal of 350 mature aspen trees for the roller coaster alone,” Parke said.

A tree trimming experts in Portland will be the one to assist in tree removal; it will be done safely and, of course, with a licensed and permitted contractor.

Vail Resorts’ landscape plan only calls for replacing those trees with 92 significantly smaller trees, he said.

“This environmental damage is a direct contradiction to Vail Resorts’ stated core philosophy that their resorts operate in some of the world’s greatest natural environments, and they are compelled to care for and preserve them,” Parker said.

The 50-foot tall high ropes challenge course would be built directly over a wetland area and stream that feeds into the Eagle and Colorado Rivers. Vail Resorts has not yet obtained permits from the Environmental Protection Agency, he said.

Colorado Open Lands, a private, non-profit land conservation and land trust organization, holds the conservation easement for the land on which Vail Resorts plans to build the amusement park complex, he said.

Read the full article here

 Eagle county homes for sale

John Marcotte

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Williams Sonoma Brands Does a Total Solid for Front Range Flood Victims

October 7, 2013 by

Williams Sonoma Brands Does a Total Solid for Front Range Flood Victims

williams sonoma colorado flood discount

You know Williams Sonoma for it’s gorgeous window displays, Star Wars-themed cookie cutters and all sorts of seasonal magic it offers up. You know Pottery Barn and West Elm for their design savvy, sumptuous throws, and catalogs that make you scream, “Yes, yes, yes!”

Well, I got an email in my inbox on Saturday that was pretty awesome — and it was from the Williams Sonoma brand family. And it was just for Colorado residents.

They’re offering an exclusive discount to victims of Colorado flooding — 20% off your purchase.

Now, if you know the Williams Sonoma brand family, you know that a 20% discount is absolutely unheard of. Sure, there are the occasional 10% off coupons that come along, but definitely not 20%.

There is a catch, however. If you’re redeeming the 20% off offer, you do have to show proof of insurance claim or your FEMA paperwork in order to be eligible.

While I did have a fleeting thought that I’d like to pump some water into my basement just to score this awesome deal, it was definitely fleeting.

So — the deal information is above in the picture in this post. To redeem, you can call the number listed in the picture and show online or heard down to the various locations for West Elm, Pottery Barn, and Williams Sonoma in the Denver/Boulder area. West Elm is in Cherry Creek and there is a location for both Pottery Barn and Williams Sonoma at the Flatirons Mall in Superior.

Share this post with your friends and family affected by the flooding. This could also be a great way to get some of your holiday shopping taken care of at a discount. And while I know that memories lost can’t be replaced, offers like this from a major brand sure do help those insurance dollars stretch further.

By Erike Napoletano of Yourboulder.com

 

John Marcotte

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U.S. seniors lock in reverse mortgages before rules change

October 6, 2013 by

 

U.S. seniors lock in reverse mortgages before rules change

(Reuters) – American seniors grappling with strained savings following the deepest recession in generations will soon face new hurdles in tapping a tool some have used to help finance retirement: the federal government’s reverse mortgage program.

An upcoming change in rules will cut the number of borrowers eligible to draw down cash against the value of their homes by 22 percent, according to an estimate from Reverse Market Insight, and some homeowners are rushing to beat the deadline.

“I had limited options and was up against a wall. It was grim,” said Cheryl Honeyman, a widow living in Brookings, Oregon, who locked into a reverse mortgage this month. “I was lucky to get this loan when I did.”

For the 63-year-old, who inherited her home near the Oregon coast when her parents passed away four years ago, the government-backed loan means she can live on the money she gets from Social Security without having to worry that an unexpected expense could force her to sell her home.

The program is costing the government. The Federal Housing Administration is expected to spend $2.8 billion this fiscal year backing reverse mortgages. Under congressional pressure, the FHA will implement new rules on Tuesday designed to stem those losses.

The changes will limit the amount seniors can draw down, impose higher mortgage insurance fees and put in place tougher vetting of applicants. But they are likely coming too late to prevent the FHA from tapping the U.S. Treasury for a cash infusion for the first time in the agency’s 79-year history.

Reverse mortgages, available to borrowers aged 62 or older, pay out a home’s equity to the borrower, either in installments or lump-sum payments. They are repaid when the borrower dies or moves out of the house, although the borrower must still pay property taxes and homeowners’ insurance.

The loans, most of which are insured by the FHA, have proved to be a lifeline for many Americans whose savings were depleted during the deep 2007-2009 recession.

Honeyman was anxious that the value of her home had significantly dropped during the recession and would limit how much money she would receive. Her home appraisal came in at $180,000 and she was able to take a $105,000 lump-sum on the property, which was purchased 13 years ago for $220,000.

DEADLINE IMPACT

If Honeyman had qualified for a reverse mortgage backed by the FHA under the new rules, she would have owed more in insurance costs and have been eligible for less money.

Loan officers and financial advisers are preparing clients for the upcoming shift, which they say will reduce the attractiveness of the loans for a vast number of seniors.

Deborah Nance, a reverse mortgage specialist with iReverse Home Loans in the Los Angeles area, said she worries the changes will mainly hurt borrowers with lower incomes, heavy debt obligations or weak credit histories.

“Those that might have previously (had) a lump sum option to pay off mortgages might be turned down,” she said.

Nance has recommended against reverse mortgages when she hears that seniors intend to move within five years, or if they have family members living with them on a long-term basis.

The problem for the FHA is that an increasing percentage of these loans are ending up in default. A record 54,000 FHA-insured reverse mortgage borrowers — or 9.4 percent – have defaulted. That’s up from 8.1 percent in July 2011.

Unlike traditional loans, the majority of defaults are triggered when borrowers are unable to pay their property taxes or keep up with their homeowners’ insurance.(Reporting by Margaret Chadbourn; Editing by Tim Ahmann and Krista Hughes)

 

 

 

John Marcotte

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U.S. housing agency likely to tap Treasury funds: sources

October 5, 2013 by

U.S. housing agency likely to tap Treasury funds: sources

(Reuters) – The Federal Housing Administration will likely soon seek a cash infusion from the U.S. Treasury for the first time in its nearly 80-year history to help it cover losses from souring loans, sources familiar with the matter said on Wednesday.

The agency, which offers private mortgage lenders guarantees against homeowner default, has nearly exhausted its reserves for the mortgages it backs. Housing officials have yet to determine how much money the FHA may need to draw, the sources said.

Losses on loans made from 2005-2008 as the market was heading south have eaten away at the agency’s cash reserves. While it is reaping profits from more recent mortgages, those profits are not expected to be large enough to make up the shortfall.

Many conservative Republicans have expressed concern that the FHA provided too much credit to unworthy borrowers during the housing crisis, and they cried foul on Wednesday.

“The FHA has been going down an irresponsible path for years,” said Senator David Vitter, a Republican member of the Senate Banking Committee. “Instead of managing their funds responsibly, and making appropriate reforms, FHA prefers to lean on taxpayers to bail them out, and enough is enough.”

The White House projected in April that the FHA would face a shortfall of $943 million for the fiscal year that ends on Monday, but the agency said it would wait until the end of the budget year to make a decision on whether to draw Treasury aid.

At that time, the FHA said it would see whether or not steps it took to raise funds and the improvement in the housing market would close its funding gap.

By law, the FHA is able to automatically access Treasury funds if it depletes it reserves, but it has never had to. In the past few years, it has taken a number of actions, including raising insurance premiums and tightening underwriting standards, to stay solvent.

The government mortgage insurer plays a key role in helping those with low and modest incomes obtain credit to purchase a home. Consumer advocates maintain the support it has given to low-income borrowers and the housing market as a whole has been worthwhile.

The FHA insures about $1.1 trillion in mortgages and supports 15 percent of all U.S. mortgages, up from about 5 percent in 2006.

It is legally required to keep a 2 percent capital ratio, which is a measure of the fund’s ability to withstand losses. It has failed to meet that threshold for a number of years.

A representative for the Department of Housing and Urban Development, which oversees the FHA, did not respond immediately to a request for comment.

(Editing by Christopher Wilson, James Dalgleish, Matthew Lewis and Andrew Hay)

 

 

 

John Marcotte

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Bank of America faces at trial ex-executive behind whistleblower case

October 4, 2013 by

Bank of America faces at trial ex-executive behind whistleblower case

(Reuters) – A former executive at Bank of AmericaCorp’s (BAC.N) Countrywide unit testified Thursday that the mortgage company’s problematic lending practices predated the “Hustle” process for which the bank went on trial this week.

Edward O’Donnell, a former executive vice president at a Countrywide Financial Corp subsidiary, filed a whistleblower lawsuit last year against Bank of America, which bought Countrywide during the financial crisis.

O’Donnell’s lawsuit is the basis of the U.S. Justice Department’s case alleging that Countrywide defrauded mortgage underwriters Fannie Mae and Freddie Mac by selling them mortgages that later defaulted.

O’Donnell, who stands to earn an award if the government wins at trial, was testifying for the government on Thursday, the third day of the trial.

He said he worked at a Countrywide division that handled subprime mortgage loans. When Countrywide tried to move away from that business, a unit of the company making less-risky prime loans was folded into his, he said.

There were instances where loans that unit produced “did not meet our standards and had problems,” he said.

“I saw these instances as problems,” he said. “I wanted greater quality and better control.”

Countrywide later made some changes at his urging, he said.

O’Donnell is expected to continue to testify on Friday about a subsequent Countrywide program called the “High Speed Swim Lane” – also called “HSSL” or “Hustle.” The program, which began in 2007 as mortgage delinquency and default rates were on the rise, circumvented toughening standards at Fannie and Freddie, O’Donnell has said.

The “Hustle” loans caused Fannie and Freddie to suffer a gross loss of $848.2 million and a net loss of $131.2 million on loans that were materially defective, the Justice Department says.

The Justice Department’s case stems from a lawsuit O’Donnell filed under seal in February 2012 under the False Claims Act. The law allows whistleblowers to bring cases on behalf of the government against companies that defraud it.

He worked at Countrywide from 2003 to 2007. In a twist, he today works at Fannie Mae as a vice president of credit risk management, a spokesman for the mortgage giant confirmed.

In his lawsuit, O’Donnell said he frequently objected to the “Hustle” program and sought to take steps that would stop the rapid deterioration in loan quality.

O’Donnell in the lawsuit said his concerns were disregarded and he was marginalized. He “became one often lone voices within the division pointing to the loan quality issues, increase of early payment defaults and growing number of early defaulted loans,” his lawsuit said.

NEW CUSTOMER ACQUISITION GROUP

O’Donnell, who took the stand toward the end of Thursday, only spoke briefly about HSSL, which he will likely discuss most of Friday. But he discussed how another unit of Countrywide called the New Customer Acquisition (NCA) group had problems of its own.

The case is U.S. ex rel. O’Donnell v. Bank of America Corp et al, U.S. District Court, Southern District of New York, No. 12-01422.

(Reporting by Nate Raymond in New York; editing by Andrew Hay)

 

 

John Marcotte

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Citigroup to pay Freddie Mac $395 million on suspect mortgages

October 2, 2013 by

Citigroup to pay Freddie Mac $395 million on suspect mortgages

A Citi sign is seen at the Citigroup stall on the floor of the New York Stock Exchange, October 16, 2012. REUTERS/Brendan McDermid

By Jonathan Stempel

Wed Sep 25, 2013 5:39pm EDT

(Reuters) – Citigroup Inc on Wednesday said it agreed to pay $395 million to Freddie Mac to resolve claims of potential flaws in roughly 3.7 million mortgages it sold to the housing finance company from 2000 to 2012.

Citigroup, the third-largest U.S. bank, said the settlement also covers potential future claims arising from the loans bought by Freddie Mac, a large purchaser and guarantor of home loans.

The deal follows an agreement by Citigroup in July to pay $968 million to settle similar claims by Fannie Mae, the largest U.S. mortgage finance company. Both Fannie Mae and Freddie Mac were bailed out by the federal government in 2008.

“Today’s agreement with Freddie Mac marks another important milestone in successfully resolving Citi’s remaining legacy mortgage issues,” Jane Fraser, chief executive of CitiMortgage, said in a statement.

Freddie Mac also praised the settlement. “The agreement is an equitable one that resolves legacy repurchase issues, and allows both companies to move forward,” Freddie Mac spokesman Tom Fitzgerald said.

Citigroup said the payment is covered by its existing mortgage repurchase reserves.

The New York-based bank received three federal bailouts in 2008 and 2009, and has since been shedding or scaling back in some of its higher-risk, slower-growing businesses.

Many banks including Citigroup sold millions of home loans to Freddie Mac and Fannie Mae, which in turn packaged them into securities that could be sold to investors.

In selling mortgages loans, banks make representations and warranties such as how well the loans were underwritten, and whether the borrowers can afford them. Banks can be forced to repurchase soured loans if those claims prove wrong.

Mounting losses from troubled loans were a key factor in the 2008 bailouts of Freddie Mac and Fannie Mae.

Wednesday’s settlement does not free Citigroup from liability on servicing the loans, and excludes fewer than 1,000 loans that carry special contractual rights and obligations.

In January, Bank of America agreed to pay Fannie Mae $3.6 billion to compensate for troubled home loans and to buy back an additional $6.75 billion of loans.

(Reporting by Jonathan Stempel in New York; Editing by Gary Hill and Leslie Adler)

 

John Marcotte

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U.S. new home sales rise but hold near lowest levels of 2013

October 2, 2013 by

U.S. new home sales rise but hold near lowest levels of 2013

(Reuters) – Sales of new single-family homes in America rose in August but held near their lowest levels this year, a sign that a sharp rise in interest rates is weighing on the U.S. economy.

Sales rose 7.9 percent to an annual rate of 421,000 units, the Commerce Department said on Wednesday.

The pace of sales was in line with analysts’ expectations and supported the view that rising mortgage rates were taking steam out of America’s housing recovery.

August’s increase in new home sales did not make up for the steep drop registered in July, when the pace of sales was the weakest since October.

Mortgage rates surged beginning in May when the Federal Reserve gave signals it was thinking of winding down a bond-buying stimulus program. The Fed surprised financial markets last week when it said it would put off reducing monthly bond purchases for now. Policymakers said rising borrowing costs played a role in their decision.

The housing market, which has been a major drag on America’s economy since the 2007-09 recession, appeared to turn a corner early last year when home prices began to rise.

Last month, the median price for a new home sale fell to $254,600. The median sales price, which is not adjusted for seasonal swings, has fallen every month since May, although is still up slightly from August 2012.

The inventory of new homes for sale increased by 3.6 percent in August from July, leaving the stock of unsold new homes at its highest level since March 2011.

(Reporting by Jason Lange; Editing by Krista Hughes)

 

John Marcotte

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