RE/MAX 360

RE/MAX 360


21% still to go?

I have recently read several news stories regarding predicted home values. The reports indicate that the 2 worst performing housing markets in the country in the next 12 months will be Miami with aprox a 30% drop in "median" value, then Orlando...but not far behind, and of little comfort that we're not number 1, is the report for West Palm Beach area home prices that predicts values to dip another 21.7 percent from a median price of $229,000 to $179,307. The report used the Case-Shiller index of home prices along with foreclosure data to formulate the prediction.

However, I always advise my readers and clients to keep in mind that the "median" can be easily skewed and is not an accurate predictive statistic for individual home values. Along those same lines, the property value sites like Zillow can be wildly innacurate. As it has always been, the undisputed most accurate way to determine a homes value at any point in time is by comparable sales and comparable offerings.

As is especially true in this market, buyers ultmately determine a homes value and they do this by "comparison shopping", as you most likely did when you purchased the home you now own.


Lakeview Estates market activity recap

Below you'll see the recent market activity for your community

  • There are currently 6 homes on the market
  • 1 of the 6 is a short sale
  • 1 of the 6 is a bank-owned property
  • The remaining 4 are regular sales at this point

  • In the previous 90 days, there has been only 1 closed sale reported

  • There are currently no homes under contract

A search of the Palm Beach County courthouse records reveals that there are currently 5 homes that have had a "Lis Pendens" (default/foreclosure notice) filed. None of the 5 are currently on the market.

Price reduction

The Aspen that was originally listed at $335,000 on August 18th has reduced their price again today...they are now asking $297,150. This is the 4th reduction to date. The home is not being marketed as a short sale.

The sellers are the original owners who purchased the home in October, 1999 for $167,400.


New on the market...Antigua

A seldom available Antigua model has just come on the market priced at $349,900.  Via public record access, it appears that the home is being sold by the original owner who purchasd the home in November of 1999 at $225,200.



Aspen, price reduction...

An Aspen (extended), originally listed at $335,000 has just been reduced to $300,000.  The home was placed on the market  August 14th and this is the 3rd price reduction.

The sellers purchased the home in March of '99 for $167,400.

Govt. Foreclosure Rescue Plan losing ground...


18,300 property tax bill appeals break record

18,300 property tax bill appeals break record

Shared via AddThis


Pulling the rug out?

Since the initial decline of the housing market and associated collapse of the banking and mortgage industry, FHA loans have taken over a majority of the lending being done here.

 I have often thought that these FHA loans were going to be our next "wave of defaulting loans" for the following reasons: Most FHA loans made here are with only a 3.5% down payment and allow the seller to contribute up to 6% towards the buyers closing costs. And generally, a lot of the buyers go "FHA" for 2 main reasons...they don't have much cash AND they have lower credit scores than required by conventional lenders.

In essence, all of these newly issued FHA loans are the same "no money down" loans that are currently contributing to the explosion in defaults. It has been shown that homeowners are more likely to default when there is no equity in the home....this seem obvious.

Well, in a declining market, like we are in, it won't take long for all of the FHA loans made in the previous 12 months to be "upside-down". Combine "upside-down", with lower credit scores and what do you get? The recipe for more defaults!

I believe that the above reasoning has prompted the following:

The FHA Taxpayer Protection Act of 2009 — HR 3706 , introduced in Congress Monday would increase the minimum down payment for Federal Housing Administration (FHA)-insured mortgages from 3.5% to 5% and would also prohibit financing initial service charges, appraisals, inspections, or other fees or closing costs with any part of an FHA mortgage. (seller-paid closing costs)

 The bill’s author, Rep. Scott Garrett (R-NJ), said the current policy of allowing closing costs to be rolled into the mortgage effectively reduces FHA down payments to as low as 2.5% (and sometimes greater than 100% financing) because borrowers don’t have to have as much (any) cash on hand at closing.

 “As we have learned repeatedly throughout the mortgage crisis, the amount of equity a homeowner has in their home directly correlates to the credit risk associated to their mortgage.”

 The bill also calls for an examination of the housing market’s dependence on the fund (FHA) since the mortgage crisis began.

The inspector general for HUD, Kenneth Donohue, also appeared before the House subcommittee calling for more resources. To illustrate the explosion of FHA’s presence in the market since the development of the near-third statistic often exchanged by industry players and media outlets, Donohue said data show the FHA’s endorsements (or guarantees of mortgages) rose from 24% of the single-family market in the first quarter of 2008, to 63% of the market in Q109, including home sales and refinance.

So, if the above bill does pass and the FHA lending criteria "tighten", then I believe that here, locally, the housing market will suffer. When you make it more difficult to obtain the loan that the majority of our buyers are utilizing...there is only 1 conclusion. Then, combine this change with the expiration of the 1st time homebuyer tax credit AND a potential rise in mortgage interest rates! Not good for us homeowners here in South Florida.

Shoot me an email and let me know which way you see the market heading.

Foreclosure...on the market

An expanded Aspen with a pool on Blue Bay Circle that was taken back by the bank on July 30th of this year has just come on the market at $285,000.

This home is reported to be 2743 sq ft under air on the Palm Beach County tax records. But from the elevations I can see, I believe it is an  Aspen, which is 2336' under air, that must have been expanded (or the tax records are incorrect). If the sq footage is correct, an asking price for a pool home in Lakeview Estates of just over $100/sq ft is quite a deal!

The previous owners paid  $450,000 for the home in December of 2006.

Lakeview Estates, Lake Worth Florida...foreclosure tracker

Lakeview Estates, Lake Worth Florida...foreclosure tracker
As of 4/1/10 there are 7 Lakeview Estates homes in some stage of foreclosure.
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