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Foreclosure Starts Rise For Second Straight Month

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Foreclosure changes June 2012

The number of U.S. homes receiving foreclosure notices topped one million through the first six months of 2012, according to RealtyTrac.

There were 1.046 million foreclosure filings between January – June 2012, says the foreclosure-tracking firm in its Midyear 2012 Foreclosure Market Report. The tally represents a 2 percent increase from the immediate six months prior.

A “foreclosure filing” includes all of the following foreclosure-related actions : (1) Default notices, (2) Scheduled auctions, and (3) Bank repossessions.

One notable fact from within the report is that, even as the number of repossessed homes dropped nationwide, the number of homeowners receiving a Notice of Default or lis pendens rose. These notices are the first step in the foreclosure process which means that we should expect the national foreclosure pipeline to fill later this year.

It’s no coincidence that foreclosure starts are rising now, either.

Earlier this year, a $25 billion mortgage servicing settlement provided banks with the necessary framework and rules by which they can foreclose upon a home. Prior to the this settlement, fearing legal liability, some banks chose to slow — or halt — foreclosure starts entirely. Since the settlement’s announcement, though, foreclosure activity has resumed.

For today’s Minneapolis home buyers, the foreclosure market represents an interesting opportunity. Homes purchased while in the various stages of foreclosure can often be purchased for a lower price than homes which are not in foreclosure; one reason why foreclosed homes account for 25 percent of all home resales.

However, be careful that you don’t confuse “less expensive“ with “less costly“.

Foreclosed homes are often sold as-is and may be in various stages of disrepair at the time of purchase. Spending money to repair a foreclosed home in order to make it habitable could wipe out the money saved on its sales price. Your best real estate “deal”, therefore, may be a non-distressed home in sound, move-in ready condition.

If you’re buying foreclosures — or even considering it — be sure to talk with a real estate agent. The process of buying a foreclosed property is different from buying a “regular” home. You’ll want somebody experienced on your team.

How To Revive A “Brown Lawn”

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Brown lawnsDuring summer months, a lush, green lawn can transform into a brown one within weeks. And heat, while oftentimes a catalyst, is not always the culprit.

As a homeowner, you can take precautions to minimize the likelihood of a brown lawn.

First, let’s look at the reasons why a lawn may go brown, starting with drought stress.

Drought stress is a condition caused by excessive heat and/or lack of water. Drought stress can lead to dormancy, a normal condition for grasses of all types. A good test for draught stress is to step on one of the grass’ brown patches. If your footstep remains as an imprint in the grass, it’s likely that your lawn is water-deprived.

Brown spots from drought stress appear randomly and without pattern. This is different from brown spots that may occur because a sprinkler system is miscalibrated, or because some lawn sections are shaded whereas others are exposed to direct sunlight.

Lawns which have been dormant for long periods of time may need to be reseeded.

Drought stress also reduces your lawn’s natural defenses against pests and disease. This includes plant-based pests such as weeds which can starve your grass of much-needed food and water, as well as insects such as lawn grubs and chinch bugs.

These two forces, as well, can lead to brownout.

Lastly, your grass may be dying. Either from a lack of aeration; or, cutting grass blades too short to provide “natural shade”; or, over-watering among other reasons, your grass may not live forever and, when it dies, it’s likely to thin and turn brown.

The good news is that each of these conditions is non-permanent. You may not have stopped your lawn from turning brown, but, generally, you can nurse it back to being green.

To water a brown lawn back to health, start with a steady watering schedule — typically 2 hours every few days (approximately 1 inch of water) — and be careful not to over-water. Then, just wait. It may take a lawn 3-4 weeks to return to its natural green color.

Then, to manage weeds, use an over-the-counter herbicide. For larger weed problems, get treatment by a professional lawn care company. The same is true for pests, too. Tackle them yourself but using a lawn care company can be more efficient and effective.

Revisiting Housing Market Predictions For 2012

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Revisiting predictions for 2012When the calendar flips to a new year, analysts and economists like to make predictions for the year ahead.

So, today, with the year half-complete, it’s an opportune time to check back to see how the experts’ predictions are faring (so far).

If you’ll remember, when 2011 closed, the housing market was showing its first signs of a reboot. Home sales were strong, home supplies were nearing bull market levels, and buyer activity was strong.

Homebuilder confidence was at its highest point in 2 years and single-family housing starts had made its biggest one-month gain since 2009.

In addition, 30-year fixed rate mortgage rates had just broke below the 4 percent barrier and looked poised to stay there.

There was a lot about which to be optimistic in January 2012.

Yet, there were obstacles for the economy. The Eurozone’s sovereign debt issues remained in limbo, oil prices were spiking, and the Unemployment Rate remained high — three credible threats to growth.

At the time, analyst predictions for the economy occupied both ends of the spectrum, and everywhere in between.

Freddie Mac said home prices would rise in 2012, for example, whereas analysts at CBS News said they’d fall. Both made good arguments.

As another example, American Banker said mortgage rates would rise in 2012. The LA Times, however, said just the opposite. And, the problem with these predictions is that each party can make such a sound defense of their respective positions that it’s easy to forget that a prediction is really just an opinion.

Nobody can know what the future holds.

A lot has changed since those predictions were made :

  • Job growth slowed sharply after a strong Q1 2012
  • Oil costs dropped rapidly beginning in early-May
  • Spain and Italy have joined Greece as potential sovereign debt trouble-zones

Now, none of this was known — or expected — at the start of the year yet each has made a material change in the direction of both the housing and mortgage markets.

Today, home prices remain low and 30-year fixed rate mortgage rates now average 3.56% nationwide. Home affordability is higher than it’s been at any time in recorded history and, at least for now, low downpayment mortgage products remain readily available.

The experts never saw it coming.

6 months from now, the markets may be different. We can’t know for sure. All we can know is that today is great time to be a home buyer in Minneapolis/St Paul. Home prices and mortgage rates are favorable.

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