New home sales plunge to lowest level in 16 years

Below is a link to an AP story pointing out that nationally new home sales in March 2008 plunged to a 16 and a half year low.

So why did I start this out as a possible "mixed bag". Well data from March for Sarasota County, Manatee and Charlotte shows that sales of EXISTING homes are actually up a bit, though prices are down.  The mixed bag is that for all the bad things that come home to roost in our economy, especially locally as it is so tied to the housing market, there is indication here of SOME movement to use up some of the backlog of existing inventory of resale homes  - perhaps at the expense of sales of new product. But for prices to stabilize we really do need to burn through some inventory before we "make some more" with new construction. If you need to sell or are currently trying to sell your home - seeing some inventory drain off would be a good thing.

In the long run though our own local economic engine will continue to sputter if the trend for new home sales continues on this path.

Here's a link to the article:

http://www.floridarealtors.org/NewsAndEvents/n4-042408.cfm

- Mike W.

Who or What IS a "Short Sale Specialist"?

In an earlier blog entry I tried to lay out some specifics on doing short sales as I have learned them from experience. In our local market for the last 9 months they have become a pretty regular part of not only our business but of the overall market.  We still have Realtors who say "I don't handle those" or "I hate them and avoid them" but honestly they ARE a significant piece of the market now so if you avoid them you lock yourself out of a piece of the market.

But today's entry is me RILING on what I'm seeing out there as "Short Sale Specialists".  Last month I sold a home and the other realtor was a very nice person but pretty much brand new to real estate. I represented the seller but I found myself having to answer all the buyer type questions, find them a bug inspector, tell the buyer how to read his HUD and what money to bring to closing etc. Many of these things were just falling through the cracks as the agent just had never done them before. I asked the agent how long they had been in business. The answer was less than a year and had done very few deals - none of them a short sale. But lo and behold - printed on the business card was "Realtor, Short Sale SPECIALIST".  Now if a DOCTOR was a SPECIALIST in say BRAIN surgery I would ASSUME he'd OPENED SOMEONE'S BRAIN and hopefully a LOT of them, under someone elses guidance, until he/she WAS really a SPECIALIST.

Now we have this new portion of our business and we have people who maybe even have not DONE a single deal that is a short OR they brought a BUYER to the process - which really isn't ANY more work for the BUYER'S side than a typical sale and these people are calling themselves "Specialists".

Perhaps you're thinking, what's the harm? Well there IS REAL HARM here. If you hire somebody as your realtor to short sell your house they had BETTER know how to negotiate with banks! AND remember IF they blow it - their own credit is not harmed but they can torpedo YOUR credit - and your house goes to foreclosure instead of being short which is a huge difference on your credit report.

Since we now have people who have NEVER done a short or if they have they represented the buyer is it any wonder some realtors think these are potential disasters that "never close".

So far on all of my short sales we have had only one get out and out rejected by the bank and even on that one we are right this minute "resucitating" the deal with the lender and will likely close it too. We do expect that in some cases we will not be able to get the bank to accept a deal but we KNOW how these work and we KNOW the approach to take to get banks to accept deals.  If your agent wants YOU or worse yet THE TITLE COMPANY to talk to the bank....RUN, don't walk, away from them.  Truly here is where having a good negotiator on the phone with the bank and someone who KNOWS how to put all the paperwork together is critical. 

And ASK - how many short sales have you successfully closed? Tell me about a couple - who were the banks, what ended up being the actual closing terms, how long did it take from contract to closing. What steps did YOU take to make this happen? Here's a REAL clarifying question: "Do you KNOW how to put a HUD1 statement together"? If they say they leave that to the title company...they are NOT a short sale "specialist".  If they tell you they represented the BUYER - while it's good they got a deal done - all they did was wait while the seller and his agent got the deal lined up. Truly on the buyer side it is about managing expectations - not about managing PROCESS. Keeping the buyer IN the transaction is of course critical but the lion's share of the work is with the seller. Plus if I were using a buyer's agent to DO a short sale I would want to know they understood the process from the sell side.  I have buyer's agents calling me on my short sales wanting to put offers in because their client offered on another short sale and it's been THREE weeks and they haven't heard so they are backing out. These deals take 6-8 weeks and as the banks get BURIED they are taking LONGER. You want to BUY a short sale? Plan to wait 8 weeks to a closing - maybe more.

OK I have railed enough for one day - but I KNOW I am going to be back on this topic more, and probably sooner than later!

- Mike W.