Real Estate Blog

Shaq's Miami Home

When sellers trim a few thousand off their homes in hopes of attracting a whole new set of buyers, does it work that way with multi-million dollar homes of the rich and famous? NBA star Shaquille O’Neal did just that when he reduced his Star Island property in Miami from $35 million to $29 million recently, according to the Hartford Courant. Who knows if $6 million makes it more affordable for some.

In looking at photos of Shaq’s home, everything appears to be big and roomy — the kitchen, the swervey staircase to the second floor, the tennis court, and the lush grounds. When it’s a home for a guy who stands 7-feet-1 and weighs 340 lbs., it better be built on the scale of a giant.

Also, no word whether Shaq is still interested in helping foreclosure victims in Orlando, as previously reported, but Shaq’s development group (Boraie O’Neal Urban Development) is going to build a 25-story condo tower in his hometown of Newark, NJ.

Shaq's pool and veranda

Originally posted here:
Shaq Trims Miami Pad to $29 Million

If the Playboy Mansion (click on the Birds Eye View radio button) didn’t have its share of squabbles equivalent to a girls’ silly 10th grade cat fight, you’re about to see the roof blown off when Hugh Hefner invites Ukrainian model Dasha Astafieva to move in with him and The Girls Next Door: Holly, Kendra, and Bridget.

True or not? Who knows. But, it continues to blow us away here at Zillow to see crazy traffic numbers continually hitting the Playboy Mansion. See more mega-historical mansions: Go visit the Beverly Hillbillies Mansion and others, in our Famous Homes list.

Go here to see the original:
Prepare for Playboy Mansion Cat Fight

Tomorrow we’ll be releasing the Zillow Real Estate Market Reports for Q2 2008.  These reports cover 165 U.S. real estate markets, and include data on home value changes over time, homeowner equity stats, and (new this quarter) what we’re calling “distress signals” - data on foreclosures and homes selling at a loss.

Zillow’s VP of data and analytics, Dr. Stan Humphries, will be hosting a Web-based conference call at 11 a.m. PDT tomorrow, August 12 to provide perspective on the data and discuss the trends we’re seeing in these reports.  He will also touch on the results of the Homeowner Confidence Survey we released last week, which highlighted the disconnect between consumer perception and reality when it comes to home values.

Anyone is welcome to join in the conference call.  Simply register at www.events.acttel.com/zillowmarketreports any time between now and then.  Alternatively, participants can dial in at 800-240-2430.

We hope you’ll join us.  Be sure to check back first thing tomorrow morning for a blog post on our Q2 Real Estate Market Reports as well.

Original post:
Q2 Real Estate Market Reports - conference call tomorrow

Fannie Mae posted a $2.3 billion loss for the quarter as the mortgage and housing bust keeps chipping away at the liquidity of the mortgage giant. At this rate, I can’t imagine it being too much longer before the treasury pumps its first infusion of capital in to the company.

At least the company cut the dividend to a nickel for investors (from 35 cents).  In my opinion as long as the government is explicitly guaranteeing the debt of this company, and using taxpayer funds to prop them up all dividends should be eliminated and corporate pay packages should be brought in line with other public officials.  How pissed are you that your tax dollars are going to pad the salary of Fannie’s CEO?

From Market Watch:

Fannie Mae reported Friday a wider-than-expected loss for the second quarter and cut its dividend as the biggest U.S. buyer of home mortgages said the struggling housing market and credit expenses again hurt its performance, sending the company’s shares lower.

Fannie Mae lost $2.3 billion, or $2.54 a share, a reversal from the $1.9 billion, or $1.86 a share, earned in the year-ago second quarter.

Daniel Mudd, Fannie’s chief executive, said that credit conditions are getting worse and that the company expects to have to resort to further increases in its loss reserves.

Share This

See original here:
Fannie posts $2.3 billion quarterly loss

McLEAN, VA — Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 6.52 percent with an average 0.7 point for the week ending August 7, 2008, unchanged from last week when it averaged 6.52 percent. Last year at this time, the 30-year FRM averaged 6.59 percent.

More:
Long-Term Mortgage Rates Relatively Flat: Housing Industry Still in Deep Slump

When you’re in a long, slow recovery period in real estate, even the slightest hint of good news can be significant.

Here is the original post:
Real Estate Outlook: Prices Up In Certain Markets

Selling your home? Before you list, consider these top 10 things to do before you put your home on the market. Some are no-brainers, but they are all worth your attention if you plan on selling your home.

1. Make a great first impression

Did you know that buyers decide in the first 30 seconds of seeing the home if this is the one? It’s true. Good curb appeal is a must.

2. Clean, Clean, Clean

No-brainer, right? Well, what was this person smoking?

3. Declutter

Knick-knacks + Tschockes + Collectibles = Clutter! Declutter, now.

4. Store it

If a room is open, it looks large and adds square footage to the home; this is $$$ in the real estate market.

5. Let there be light

Open the curtains and let the sunshine in! You may like your privacy, but the buyer doesn’t want to think about that when looking at a home.

6. Neutral background

Neutral walls (not just white) that are clean and have an up-to-date color makes a huge impression. Bright colors on walls can be a turnoff for some.

7. Set the stage

You know that dining room that goes unused most of the time? Spiff it up and make it look like you know how to pah-tee.

8. Empty closets

Empty every closet as much as you can. Remove out-of-season clothes. You want it to look as though there is room for the buyers’ things. Not like this.

9. Pet smarts

You love your dog. But not everyone loves pets! Get some tips on selling a home with pets.

10. Smells good

Check out bullet #3 under “Essential Tasks.”

Originally posted here:
Top 10 Things Before You List Your Home

It’s a topic dominating the headlines, news shows and the race for president. You’d have to be living under a rock to not know the housing market is in distress and home values are dropping…. right?

Apparently not - at least when it comes to our own homes. Today Zillow released our Q2 Homeowner Confidence Survey — asking more than 1,300 U.S. homeowners their perception of their own home’s current value, as well as what they think will happen with their home and local market in the coming 6 months. The results were eye-opening, to say the least…

• 62% of U.S. Homeowners believe their home’s value has increased or stayed the same in the past year. In reality, 77% of U.S. homes have declined in value over the past 12 months.
• People living in the West seem to be a little more realistic, with 44% believing their home’s value has increased (28%) or stayed the same (16%); however more homes in the West have lost value, with 88% of Western homes declining over the past year.

This chart breaks out the difference in homeowner perception vs. reality by region.

Looking into the future, homeowners continue to be optimistic — about their own homes, that is. Three out of four (75%) homeowners expect their home’s value will increase or stabilize in the coming 6 months. However, when asked about their local market, 42% think home values in their locality will decrease (compared to the 25% who think this about their own home). Clearly we think it’s the neighbor’s house that will be affected, not ours.

Unfortunately I’m not a psychologist to analyze what the heck is happening here… but it’s not a far stretch to call it denial. Or as my boss Spencer Rascoff said the other day — if you ask people if they have an above-average IQ, 90% of people think they do. Wishful thinking.

What do you think is driving this perception gap? And will it change in the coming months? We’ll let you know next quarter…

Meanwhile:

If you’d like to learn more about what’s happening in your local market, next week we’ll release our Q2 Real Estate Market Reports, which chart home value changes for 165 metropolitan statistical areas, the largest report of its kind. New this quarter, we’ll also look at % of homes sold for a loss, and % of home sales that were foreclosures. You can tune in to our Q2 Market Reports Conference Call on August 12 at 11am PT, to hear Dr. Stan Humphries discuss these reports as well as some more findings from today’s survey. To sign up for the Web version of this call, visit www.events.acttel.com/zillowmarketreports. Or, you can dial in directly at 1-800-240-2430.

Go here to read the rest:

I have gotten more than a few parking tickets in my time, and tend to wait until the last minute to pay them. I am often tempted to not pay, just to see what might happen. It couldn’t be too bad, right? Lucky for me, I’ve never actually had the guts to find out. Unfortunately, Milwaukee’s Peter Tubic wasn’t as lucky, as he is currently facing foreclosure due to an unpaid parking ticket.

Pretty unbelievable, right? How can a parking ticket lead to foreclosure? According to the Milwaukee Journal Sentinal, one thing led to another and Tubic found himself in the biggest jam of his life. Apparently, Tubic couldn’t afford to pay the ticket due to some medical issues he was having, and also due to the recent death of his father. City officials, while sympathetic, said their goal is only to collect fees and taxes, not to take someone’s house. But, the fine was unanswered since it was issued back in 2004 and with late fees, the fine escalated to $2,600. The moral of this story is to pay your fines, as unpleasant as they may be. And, if you see something weird in real estate, it’s probably related to foreclosure.

Don’t homeowners have enough to worry about these days?

(Hat tip to U.S. News & World Report’s The Home Front blog)

See the original post:
Unpaid Parking Ticket Leads to Foreclosure

I have gotten more than a few parking tickets in my time, and tend to wait until the last minute to pay them. I am often tempted to not pay, just to see what might happen. It couldn’t be too bad, right? Lucky for me, I’ve never actually had the guts to find out. Unfortunately, Milwaukee’s Peter Tubic wasn’t as lucky, as he is currently facing foreclosure due to an unpaid parking ticket.

Pretty unbelievable, right? How can a parking ticket lead to foreclosure? According to the Milwaukee Journal Sentinal, one thing led to another and Tubic found himself in the biggest jam of his life. Apparently, Tubic couldn’t afford to pay the ticket due to some medical issues he was having, and also due to the recent death of his father. City officials, while sympathetic, said their goal is only to collect fees and taxes, not to take someone’s house. But, the fine was unanswered since it was issued back in 2004 and with late fees, the fine escalated to $2,600. The moral of this story is to pay your fines, as unpleasant as they may be. And, if you see something weird in real estate, it’s probably related to foreclosure.

Don’t homeowners have enough to worry about these days?

(Hat tip to U.S. News & World Report’s The Home Front blog)

Go here to see the original:
Unpaid Parking Ticket Leads to Foreclosure

I have gotten more than a few parking tickets in my time, and tend to wait until the last minute to pay them. I am often tempted to not pay, just to see what might happen. It couldn’t be too bad, right? Lucky for me, I’ve never actually had the guts to find out. Unfortunately, Milwaukee’s Peter Tubic wasn’t as lucky, as he is currently facing foreclosure due to an unpaid parking ticket.

Pretty unbelievable, right? How can a parking ticket lead to foreclosure? According to the Milwaukee Journal Sentinal, one thing led to another and Tubic found himself in the biggest jam of his life. Apparently, Tubic couldn’t afford to pay the ticket due to some medical issues he was having, and also due to the recent death of his father. City officials, while sympathetic, said their goal is only to collect fees and taxes, not to take someone’s house. But, the fine was unanswered since it was issued back in 2004 and with late fees, the fine escalated to $2,600. The moral of this story is to pay your fines, as unpleasant as they may be. And, if you see something weird in real estate, it’s probably related to foreclosure.

Don’t homeowners have enough to worry about these days?

(Hat tip to U.S. News & World Report’s The Home Front blog)

Read more:
Unpaid Parking Ticket Leads to Foreclosure

I have gotten more than a few parking tickets in my time, and tend to wait until the last minute to pay them. I am often tempted to not pay, just to see what might happen. It couldn’t be too bad, right? Lucky for me, I’ve never actually had the guts to find out. Unfortunately, Milwaukee’s Peter Tubic wasn’t as lucky, as he is currently facing foreclosure due to an unpaid parking ticket.

Pretty unbelievable, right? How can a parking ticket lead to foreclosure? According to the Milwaukee Journal Sentinal, one thing led to another and Tubic found himself in the biggest jam of his life. Apparently, Tubic couldn’t afford to pay the ticket due to some medical issues he was having, and also due to the recent death of his father. City officials, while sympathetic, said their goal is only to collect fees and taxes, not to take someone’s house. But, the fine was unanswered since it was issued back in 2004 and with late fees, the fine escalated to $2,600. The moral of this story is to pay your fines, as unpleasant as they may be. And, if you see something weird in real estate, it’s probably related to foreclosure.

Don’t homeowners have enough to worry about these days?

(Hat tip to U.S. News & World Report’s The Home Front blog)

Read the original here:
Unpaid Parking Ticket Leads to Foreclosure

Hey, after a gauntlet of market report releases for the month of July, I’ve been sort of AWOL for the past several days. Hey. It’s summer. Tomorrow I ride on a rollercoaster…literally.

Last week, the FASB decided to delay the proposed accounting rule that keep banks from hiding assets via special purpose entities (SIVs)

The rules were tightened, but criticism erupted again last year after some banks suffered large losses from structured investment vehicles and other entities that had been kept off balance sheets under the rule.

Everyone seems to want less regulation:

SEC Chief Warns against Investment Bank Regulations

“Rather than extend the current approach of commercial bank regulation to investment banks, I believe Congress and regulators must recognize that different regulatory structures are needed for oversight of these industries,” Cox said. “Put simply, regulatory reform should not, and need not, amount to the elimination of the investment banking business model.”

The Mortgage Bankers Association was relieved about the delay, likely because it will give them more time to modify or prevent the change from happening.
Kieran P. Quinn, CMB, Chairman of the Mortgage Bankers Association commented in the press release about the impact of new rule on credit liquidity. (Incidentally, I am guessing this is the same Kiernan I spoke to fairly often as one of our mortgage clients. He was a straight shooter who was very loyal to firms who provided high quality appraisal work. So admittedly, I give more weight to what he says…). He today commented on the decision by the Financial Accounting Standards Board (FASB) to delay, by one year, implementation of a forthcoming proposal that would bring sweeping changes to securitization accounting.

Consolidation of securitization QSPE is likely to swell the balance sheets of the affected entities, adversely impact financial ratios, financial covenant performance and regulatory capital tests; and bring a new chill to credit markets at the exact time when all market participants are working to relieve the current credit crunch. We look forward to working with the FASB to implement the changes and make this transition as smooth as possible.

The full disclosure catch-22: If the accounting rule is implemented, the use of SIV’s and other off balance investments will be sharply curtailed,

1…causing the ratios to show an increased need for more capitalization which equals less liquidity in the market, which is just what the credit markets don’t need.

2…preventing what got us here in the first place - a lack of understanding about the true risk associated with a given lender.

So we need to ask ourselves a question…Do I feel lucky?” Well, do ya, punk? In other words, do we want greater liquidity to help housing out of its current mess, or do we instill the basics in a financial system that lost its way? I seem to remember last year at this time, we got in the credit mess because of the lack of disclosure, no?

If we feel lucky, we can ignore issues where we think there is a wide margin for error without the risk of serious consequences.

Or do we stand in line and get the new iPhone 3G?

Full disclosure: I finally got my Apple lemming fix and waited in line at the Apple Store. Was in the store with my son getting a 6 year old laptop resuscitated (couldn’t) and stood, on a whim in the line for the iPhone in front of the store. The Apple employee informed us the store had 7 iPhones left for the 10 customers in line. She also informed me that some of the people may not be able to get out their existing phone carrier contracts and may exit the line. A few minutes later, the first person left. 2 more to go. Was wishing I had a voodoo doll handy. 5 Minutes later, the next person in line was informed by his wife via phone that it would be a cold day in hell before he was buying another cell phone. One person in front of us in line with no one behind us. Like the man on the bubble position at the Indianapolis 500. The last remaining customer was speaking with ATT and getting more and more aggravated. My son and I winked at each other because the prospects looked good. 10 minutes of wrangling the store manager on the phone, pleading and scolding the telcom rep were unsuccessful. An Apple employee came to me congratulating me as if I won the Publisher’s Clearinghouse Sweepstakes. A few cheers were made by Apple employees as I was taken into the store. The white 16 Gig iPhone 3G was mine…(as long as I bought an ice cream cone for my 9 year old who patiently waited the half hour with me).

Credit:
[Waiting In Line] Disclosing The Delay For Balance Sheet Full Disclosure

McLEAN, VA — Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 6.52 percent with an average 0.7 point for the week ending July 31, 2008, down from last week when it averaged 6.63 percent. Last year at this time, the 30-year FRM averaged 6.68 percent.

Read the rest here:
Inflation Concerns Ease As Do Mortgage Rates

I think the future holds more licensing requirements in store for real estate professionals. After entering a credit crisis like we are currently experiencing, all professionals connected to the real estate industry may face new licensing or additional requirements.

In an interesting piece written by two economists—Fed visiting scholar Morris Kleiner, of the University of Minnesota, and Richard Todd, vice president of Community Affairs at the Minneapolis Fed called Licentious Behavior:

On the face of it, this makes perfect sense: If incompetent or dishonest brokers have encouraged borrowers
to take out loans beyond their means, then targeting
these abuses through stricter governmental requirements on brokers should help prevent future problems.

But a recent empirical examination by two Fed econ-
omists casts doubt on that solution. In the first compre-
hensive assessment of relationships between mortgage
broker licensing and market outcomes, the economists
find that most regulatory steps appear to have no clear
connection to consumer outcomes, but one financial
regulation (surety bond and minimum net worth
requirements) is consistently related with conditions
that seem worse for both brokers and borrowers.

Deja Vu

The appraisal industry faced new licensing requirements in 1991 as a result of the S&L crisis of the late 1980s. Think Vernon Savings & Loan and property values being appraised higher every few hours by appraisers who must have possessed incredibly precise and masterful valuation skills and adequate supporting data (yeah, right).

Appraisers ended up being licensed, waiting in line with other professionals in the testing centers such as pool cleaners and hair stylists.

Appraisers were part of the problem in the current credit crunch as well. Licensing did not prevent bad appraisers from crossing the line then or now. In fact, I would venture to guess that the quality of the average appraiser (not the median) declined sharply after implementation of licensing 17 years ago.

Was it licensing that created the deterioration in quality of appraisers?

No. It was a bigger systemic problem but it did play an unintended role. Licensing of any profession provides a false premise of quality. In this case it was presented to the mortgage industry, but more importantly, allowed a shift in liability to the appraiser who had a freshly painted bullseye on his or her back.

Licensing alone does not promote better quality work.

Quality only gets noticeably better by an incentivized private sector who is enticed through regulation to require better quality reports. It is not enough to say you “can’t do something.”

Is licensing a good thing?

Absolutely. It provides a minimum barrier to entry and a process to allow for the removal of bad appraisers from the business.

Licensing alone won’t improve quality, however. An example would be a town whose police department cracks down on speeders - this alone doesn’t make everyone a better driver, but it does play a role in improving safety. People still get into accidents when they have a drivers license.

A side benefit to municipalities becomes an important revenue opportunity for the licensing bureau, especially with a weakening economy in most of the country. Revenue funds some enforcement for blatant violations, and provides some oversight and regulation. I am fairly certain that a portion of earmarked licensing revenue ends up channeled to other departments, essentially defeating a primary argument for licensing.

What about mortgage brokers?

So for mortgage brokers who are on the verge of being licensed in New York state, with a economic slowdown already being felt, I think it is a long shot that this effort will be defeated.

Will it increase the quality of mortgage brokers in New York state? I doubt it, only on the lower fringe.

I saw first hand the basic financial conflict in their role as commissioned provider of mortgage business, paid only if the loan closed. As in every profession, there are good and bad “professionals.”

All who touch the mortgage should to be licensed, at the very minimum.

Original post:
Licensing Doesn’t Really Work, But A Necessary Revenue Opportunity