|
|
Form the 2 most reputable statistical sources Core Logic and The WFRMLS we see Salt Lake county prices down about 9% on the year. There are communities where that is in the 14% range. After the tax credit ended in the end of September home sales are way down. Since the highs of 2007 [...]
Is it better to walk away from your mortgage?
Interesting NPR Talk Of The Nation program about people walking away from their mortgages. We’re continuing to see upside down home values in Utah so we can expect to see more Owners in this situation here in Utah. What do I think it would take for most families to consider walking away from their home and allowing the bank to have their house? Well, if you’re 25% upside down or more on a home that was valued at $500,000 in 2006, and is now valued at $350,000 then you are probably looking at 10 years before your home reaches back up to a $500,000 value. In the high value or hardest hit areas; like Herriman, Riverton, Saratoga Springs, Lehi, and Eagle Mountain in Utah county the depreciation can be as high as 60%. If you purchased or refinanced for 100% in 2006 or 2007 you probably are 25% to 30% upside down on you home. I definitely see people walking away when even a short sale can’t get approved. The real estate community is very active in listing short sales but the banks, especially the 2nd mortgage holders, are not cooperating. I currently have 3 short sales where the 2nd mortgages are causing a foreclosure because they want too much money for their payoff or they just wait too long for the first mortgage holder to make up their minds.
I have one friend that walked away from his home. Well, he is actually still living in the home even though it was foreclosed on 6 months ago. The bank never contacted him. He lives in the earth slide area of North Salt Lake. Continue reading Will they Walk Away from Mortgage in Salt Lake
 In today’s troubled Salt Lake real estate market if you’re a seller you are probably asking how can you compete with the short sales and banks? We’ll if you have been following you blog posts on pricing a home you have to look at the absorption rates of a market and price in the % of homes being looked at by buyers. 30 homes on the market from $100,000 to $160,000 of similar qualities and area and 3 to 5 selling a month you would have to being the best 15 house for bang for the buck of a buyer. How do you do that if your let’s say on South mountain and your own $230,000 on a home that you bought in 2004 that was appraised for $290,000 in 2006 for your no-cash out refinance to remove your mortgage insurance. You think Ok my home is not worth $290,000 but it worth $260,000. We’ll in reality the bank owned and the short sales are selling for $230,000 at $80 a SQFT. You’re priced at $86 a sqft and your not getting any showing. Worst off if you sell for the $230,000 you will have 6% commission and title fees of $2,300; you come out of pocket with $16,100 to move. We’ll the sobering fact is that selling a home isn’t only about exposure to buyers, that just gets buyers to your home. Ok once they’re there you still have to have the best bang for the buck home no home buyer wants to pay top $ for a nice paint job. Everyone what to think their home is the nicest in an area it the best kept staged etc. Those aspects don’t matter to buyers, period unless you’re also the best buy! Continue reading Flat Fee Listing Services that work in Salt Lake housing sales
Now that we have the economics 101 out of the way let’s look at the Reality As Is way a market behaves, or in this case misbehaves. Markets for housing are constantly in flux, having homes sell and new home come on the market and how that relates to pricing. To price a property correctly in this type of market with an absorption rates less than 8 months but not less than 3 months, you would have to be an attractive home in the lower 30% of the price range for similar properties in order for it to sell in the next 12 months. [...]
|
|
Recent Comments