Foreclosure Television

Dear reader, a good story uses an extraordinary character in a wildly fantastic situation to make a statement about humanity and human nature that is clear, deep, profound, and universal. Zablotskyy the Scrivener is a good story.

Zablotskyy is a modern scrivener … he blogs for a living.

Old Behrouzi (whom I deem to be the embodiment of two evil powers - ambition and indigestion) preferred Zablotskyy when he wrote good reviews because it meant more money for Old Behrouzi’s red pockets. But strangely did Old Behrouzi change his mind when Zablotskyy became a millstone, not only useless as a necklace, but afflictive to bear.

You see, no amount of choleric hectoring by old Behrouzi could silence the whispers of wonder running round his grub-man company. No sooner had Zablotskyy dilligently copied out a charming blog post than, as if through an error of destiny, actual customers rose up and shouted, “We are seriously displeased with Old Ben!”

So what was Zablotskyy to to do? He asked himself, “Why, how now? What next?” He sat awhile in in perfect silence, rallying his stunned faculties. And like a sort of innocent and transformed Marius brooding among the ruins of Carthage, he cried, “enough!” Taking higher considerations and vastly wiser and more prudent principles into account, he told the truth.

And so, harassed by anxiety for the future, the already ambitious and dyspeptic Behrouzi did, as ambitious and dyspeptic men always do in a specially heavy way. He sued our Zablotskyy for the mild effontery of truth our unremarkable scrivener penned.

A soul whom prosperity harmed, Old Behrouzi avoided remembering the existence of actual customers unless compelled to do so.

Ah, Old Behrouzi! Ah, humannity! Black by greed and everlasting shade, may God some way bless you and bring you to the light.

Yesterday I was thinking about Old Behrouzi here, and I think that if he would but prefer to take a quart of good ale everyday, it would do much towards mending him, and enabling him to examine his merely self-interested motives.

As for Zablotskyy, there would seem little need for proceeding further in this history. Imagination will readily supply the ending. But, ere parting with you, the reader, let me say that if this little narrative has sufficiently interested you to awaken curiosity as to what to do to fight the scourge of Old Ben and, at the same time, procure a good ale for Zablotskyy, I can only reply that in such curiosity I share.

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Note: The above is a blatant parody of Herman Melville’s short story Bartleby the Scrivener. Go here for the actual facts behind Behrouzi vs. Zablotskyy. Better yet, click below to donate to Mr. Zablotskyy’s legal defense. No effort is too little when confronting evil … and no amount too small when helping a friend fight the injustices of the legal system.

Support Vlad Zablotskyy’s Defense Fund
Defend your own right to free speech!

Real estate, like death, has three lives … buyer’s market, seller’s market, and a balanced market. But which one can we count on to show up today?

Current wisdom says it’s a buyer’s market. This might be true because Moreno Valley currently has 11 months worth of unsold inventory. The most recent national figures show price declines unseen in the last 20 years!

But lurking in the shadows is a more balanced market. If you don’t count short sales (which rarely close), Moreno Valley currently has only 7 months of unsold inventory!

Prices in Moreno Valley are down about 42% from May of last year, but sales are up 128%! And both of those are largely because of bank owned foreclosures.

If you’re considering a real estate purchase you need to do your work up front to be competitive in the Moreno Valley real estate market. Here’s a short checklist for you to consider:

1. Work with a reputable Lender to get what’s called Direct Underwriter (DU) Approval.
2. Be prepared to submit proof of funds for your down payment.
3. Consider writing an offer that includes 10 days for contingency removal (instead of the usual 17 days).
4. If you’re putting more than 5% down, consider offering to bring it in to escrow after you remove contingencies, instead of waiting until the very end.
5. Know what you want and be prepared to write offers as soon as possible. Waiting even an extra day can mean that you’ll face a multiple-offer/highest-and-best-counter situation.
6. BONUS TIP! Write several offers to ensure that you get one of them.

I don’t claim to know everything. What’s worked for you in the past? Have any stories to share with us?

My phone rang this morning.  A buyer wanted to know, “Should I buy a short sale or a bank owned home?”

I hate these calls because short sales are like the Temple of Doom … alluring, but booby-trapped.  Consider the latest proof.

If you are a Seller facing foreclosure, by all means list your house and try to sell it short.  You should also consider a deed-in-lieu.  Make sure the agent you select knows what he’s doing (contact me direct at 951-571-9229 or sean.giorgianni@gmail.com for a list of questions to ask).

If you’re a Buyer and a short sale is EXACTLY what you want, then write a fair offer and be patient.

But the truth is, short sales are not closing in this market.  Bank owned homes are, but not short sales.

32 of the last 100 listings in Moreno Valley are short sales; only 4 of the last 100 sales that closed were short sales.  Your chances of closing on a short sale are even worse though!

If you do the math you find that only 1 of every 167 short sale listings in Moreno Valley closes. That’s better than the odds of getting a royal flush in Vegas, but not by much.

What do you think?  Share your thoughts by sending me an email directly or, better yet, post a comment right here on the blog.

A first-time buyer asked me on Trulia Voices, “Is this the best time to buy in Moreno Valley?”

Here’s my answer: That depends.

Do you want to catch a falling knife or follow the yellow brick road to real estate wealth? I don’t mean to be flip, but a fair answer to your question depends on many factors.First, the facts.

Moreno Valley has a 14 month supply of homes (2,094 to be exact) for sale. That means that if the current pace of closings continues and no other homes come on the market, it’d take 14 months for every last home to sell.

Many define the bottom of a market when sales exceed listings for three consecutive months. The trend for new listings is increasing, but not to the degree that it is for closings. So I suspect we are nearing the bottom, but we aren’t there yet. The next 30 days will tell us a lot.

In Moreno Valley we are seeing rabid competition for bank-owned homes below $250k. These homes are seeing multiple offers. You can help yourself by working with a Buyer’s Agent who knows how to write an offer that the Bank will accept. Things to consider are escrow length, contingency length, ability to close as communicated by your agent, and some other ways we can tweak the purchase agreement.

Only pursue a short sale if it is THE home for you. 50 of every 100 listings is a short sale, but only 4 of every 100 short sales actually close. Listing Agents like short sales because they can use them to lure Buyers and switch them to other properties.

I suggest you spend some time reviewing the California Residential Purchase Agreement. I give my clients a copy and have them mark it up and ask questions BEFORE we write an offer. There are over 100 different forms that can be used in a real estate transaction in CA and you want to be sure your agent adequately understands the forms and how to use them.

The bottom line is it’s never a bad time to buy real estate. You just have to decide what price and terms are acceptable to you.

My experience is that it’s helpful to ask, “How will I feel if I don’t get THIS house?” The answer to that question usually reveals your negotiating limits.

I am currently personally working with 29 buyers and have many satisfied clients. Let me know and I can put you in touch with any of them so you can hear for yourself how a professional treats his clients.

182 new bank owned foreclosure listings came on the market in Moreno Valley in the last 30 days.  Here’s a free map of new bank owned listings in Moreno Valley.

See the table below for a quick analysis.

New Foreclosure Listings - Last 30 Days

It’s a little long, but here’s a nice slideshow with pictures of all the new listings:

Created with Admarket’s flickrSLiDR.

This is a great new foreclosure listing in Chino, CA. It has 3-bed/3-bath, 1543 sq. ft., and is listed at $384,900. It’s close to the 71 Freeway and has an awesome backyard.

from animoto.com posted with vodpod

“A poor thing, a poor thing, says he who is giving money for goods: but when he has gone on his way, then he makes clear his pride in what he has got.”

– Proverbs 20:14

I’m a real estate geek.  Unlike some agents, I pore over new listings, sales, and historical data to uncover trends that might help my clients.

Look at this chart of Moreno Valley real estate sales. It compares the last 30 days with the same period last year. What do you see?

Here are the facts: Sales are down 36% and prices are down 29%.  That’s a “poor thing, a poor thing,” right?

 Or is it?

A closer look at the facts shows

• The bottom of the market has dropped 53%.
•  A year ago you’d  pay about $3,153.41/mo. PITI for the average 1,707 sq. ft. house in Moreno Valley.  That’s $1.85/sq. ft. on average.
• Today, that same Moreno Valley real estate would cost you about $2,207.01/mo. PITI for a 1,885 sq. ft. house. 
• That’s $1.17/sq. ft. … a 37% increase in affordability!

Let’s recap: in today’s Moreno Valley real estate market you can get MORE house for LESS money at a more AFFORDABLE rate.

Perhaps it’s time to show a little pride?

[note: The lawyers forced me to say, “All figures are based solely on my research and calculations. There is no warranty, express or implied, as to their reasonableness or efficacy.You should consult a professional and satisfy yourself before making any decisions.]

An agent in my office swears by short sales because you’ll see the low price and call him.  He doesn’t care about selling THAT house. All he cares about is getting your number so he can “drip” on you until you buy another house from him.

Short sales don’t close … bank owned foreclosures do.  If you want to buy a house, don’t waste your time on short sales.  Find a reputable agent to represent you and go make your dreams of investing in a home come true.

380 resale homes came on the market in Moreno Valley in the last 90 days.  32% were short sales, 37% were bank owned foreclosures, and 31% were regular sellers.

Here’s a graph.

Think 90 days isn’t enough time to sell a house these days? You’d be wrong.  9 have sold and 37 are pending.  See the graphs below.

But that doesn’t tell the whole story.

76% of the pending deals are bank owned foreclosure listings.  But 89% of those that sold were REOs (REO and bank owned are synonymous)!  The discrepancy is because all those offers you write on short sales aren’t closing.

Take a look at this map of new foreclsoures in the 92557 zip code of Moreno Valley.

 
View Larger Map

The math is clear, you could pay a regular seller $296,041; make an offer that won’t close on a short sale for $257,609; or you could save an average of $15,250 and buy one of these lovely homes.

Of course, an experienced buyers agent for REO properties could save you even more.

What affects how quickly your home sells more: number of photos in the multiple listing service (MLS) or price? I recently did a regression analysis to find out. Surprisingly, the strongest correlation is between how long it takes to sell your house and the number of photographs you have in the MLS (email me and I’ll send you the MS Excel data).

In 2007 someone paid $3,346,456 for a photograph called 99 Cent II Diptychon by Andreas Gursky.

So, is a picture of your house in the MLS worth $17,079? Apparently so.

Here’s the worst photograph in our local MLS for a house over $500,000. For $526,979 I’d expect the picture to be in focus.

On the other hand, here’s the - ahem - picture the seller of this house listed for $509,000 got.

So, which of the three would you buy? And would you have answered the same two years ago?

Please excuse me, I gotta go take pictures of the Dollar Tree.