AOL Real Estate - Blog http://realestate.aol.com/blog AOL Real Estate - Blog http://realestate.aol.com/blog/media/feedlogo.gif AOL Real Estate - Blog http://realestate.aol.com/blog en-us Copyright 2013 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/REO to Rental: Fannie Mae Dips Further Into Foreclosure Poolhttp://realestate.aol.com/blog/2012/03/01/reo-to-rental-fannie-mae-dips-further-into-foreclosure-pool/http://realestate.aol.com/blog/2012/03/01/reo-to-rental-fannie-mae-dips-further-into-foreclosure-pool/http://realestate.aol.com/blog/2012/03/01/reo-to-rental-fannie-mae-dips-further-into-foreclosure-pool/#commentsFiled under:

reo to rentalFannie Mae waded further into the foreclosure pool on Monday as it released new details on its plan to sell its repossessed homes as rental properties.

The pilot program, first announced in August as an effort to clear the mortgage giant's backlog of foreclosures, is launching with an initial offering of 2,490 residential properties in some of the hardest-hit markets. The largest percentage of homes (23 percent) is located in Atlanta, with Los Angeles/Riverside and West Florida rounding out the top three. (View a breakdown of the properties below.)

Buyers can include corporations, investment trusts and even individuals, so long as they meet eligibility requirements and agree to rent the properties for a set number of years.

An Underwhelming Debut?

But after months of anticipation from REO investors and market analysts, some experts were unimpressed by the program's first offering.

An analysis of the available properties by analytics company Capital Economics found that 85 percent of the units are already occupied.

"Frankly, it doesn't really address what we hoped the REO scheme would address," Capital Economics analyst Paul Dales told AOL Real Estate. Namely, he said, their goal should be twofold -- to reduce the number of vacant homes on the market, which drive down home values, and to help lower the cost of renting by providing new rental units to the market. Neither of which is really tackled by the initial REO offering.

He does give the program the benefit of a doubt, though -- they may be trying to sell off the low-hanging fruit first. Selling properties with tenants already in them ensures a steady stream of income for the investor. Dales says that he suspects the strategy will shift toward moving more vacant properties, as soon as the program feels out its investor base.

Will Investors Bite?

Donna Robinson, an Atlanta-based REO specialist and consultant, doesn't think offering occupied properties is necessarily a bad thing -- it just leaves a lot of unanswered questions for investors.

"Most landlords aren't big, highfalutin investors," Robinson said, but those who do qualify for the program will have several questions about the quality of their inherited tenants, and the terms on the leases. And for those purchasing larger pools of properties, trying to standardize lease terms only becomes more involved as the distance between properties and the number of tenants grows.

The FHFA said it will make more details available -- presumably answering some of the above -- to prospective investors who pass through a "rigorous" qualification process and sign a confidentiality agreement.

What remains to be seen is the typical size of the foreclosure pools that the program hopes to unload on investors, and at what rate of discount. The nearly 2,500 properties released for sale in the initial offering represents only about 1 percent of all foreclosures owned by the government sponsored enterprises, which include Fannie Mae and Freddie Mac, according to Capital Economics. In August, there were nearly 250,000 foreclosures owned between Fannie Mae, Freddie Mac and the Federal Housing Administration.

Even under optimal conditions, an analysis of the program by Goldman Sachs suggested that the project would have "positive but modest" effects, with maybe a 0.5 percent increase in home values within the first year.

But if more buyers share the same zeal for the prospect of single-family investing as renowned investor Warren Buffet, the program could be off to a great start. Buffet recently told CNBC that he would buy up "a couple hundred thousand" single-family homes if it were practical, and for the right price, going so far as to say that houses are a better investment than stocks at the moment.

Whether or not his peers will pony up to clear the more-than-200,000 inventory of FHFA-managed home foreclosures remains to be seen, but the market waits for no one. The New York Federal Reserve Bank predicted another 3.6 million foreclosures nationwide over the next two years.

Breakdown of Properties in the Pilot Offering:



See also:
Foreclosure Fire Sale: Will 'REO to Rental' Program Fly?
Slideshow: Short Sales That Are Long on Value
Fannie Mae Asks Fed for Another $4.5 Billion

Forming Partnerships in Real Estate Investing

 

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]]>bank owned propertiesfannie maeFederal Housing Finance Agencyfhafha mortgagesfhfaforeclosure crisisreo to rentalREO to Rental ProgramStefanos Chen2012-03-01T11:38:00 00:001 in 4 Spend More Than Half of Income on Housing, Study Sayshttp://realestate.aol.com/blog/2012/02/27/1-in-4-spend-more-than-half-their-income-on-housing-study/http://realestate.aol.com/blog/2012/02/27/1-in-4-spend-more-than-half-their-income-on-housing-study/http://realestate.aol.com/blog/2012/02/27/1-in-4-spend-more-than-half-their-income-on-housing-study/#commentsFiled under: ,

home affordabilityIn the wake of the housing bust, almost 1 in 4 working families spend more than half their income on housing costs, according to a new study.

The study by the Center for Housing Policy found that both homeowners and renters continue to struggle with housing costs since the market tanked in 2008. Between 2008 and 2010, renters saw their median income decline even as housing costs rose, while homeowners' loss of income outpaced a modest drop in housing costs. Experts typically warn against using more than 30 percent of pretax income toward housing costs. (Read more about debt-to-income ratio here.)

In 2010, the latest year in which data was available, there were 10.6 million households with more than half their income going toward housing, including utilities. A total of 23.6 percent of working households fell into that precarious category -- up 1.8 percentage points from 2008. (The study defines working households as those that make less than 120 percent of an area's median income and work at least 20 hours a week.)

With prospective buyers finding it harder to qualify for a mortgage and job security remaining a top concern for many families, rental demand has surged in past years, driving up costs. For homebuyers who purchased risky loans with little equity at stake during the boom years, high interest and sliding home values have pushed thousands underwater, with insufficient savings to escape the cycle.

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"The data show that homeowners have been hit hard by the housing crisis in more ways than just lost equity," said Jeffrey Lubell, executive director at the Center for Housing Policy, in a statement. "Many working homeowners have been laid off or had their hours cut."

Homeowners felt the pinch of diminishing salaries more acutely than renters, dropping to a median of $41,413 in 2010, down from $43,570 in 2008. Working renters, on the other hand, typically make less, with a median income of $30,229 in 2010.

Unsurprisingly, the groups that were most at risk of having a severe housing cost burden made less than 80 percent of their area's median income, whereas wealthier households held steady over the 2-year period.

Where Housing Hurts Most

Between 2008 and 2010, affordability has significantly declined in 24 states. The five states with the highest share of households spending more than half their incomes on housing were California (34 percent), Florida (33 percent), New Jersey (32 percent), Hawaii (30 percent) and Nevada (29 percent).

With several experts predicting that the $25 billion mortgage settlement with the nation's largest banks will lead to more foreclosures at the start of 2012, both renters and owners should brace for more price fluctuation in their local markets, at least in the short term.

That said, the group most affected by the price confusion are those who bought during the height of the housing bubble, prior to 2008. For those entering the market today, however, sinking prices and near-record low mortgage rates places home affordability at a 20-year high.

Also see:
Black Borrowers Face Higher Hurdles in Lending, Study Shows
How the Foreclosure Settlement Could Affect You

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
Find rentals in your area.


How to Estimate the Cost of Buying a House

 

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]]>affordable housingCenter for Housing Policydebt+to+income+ratiodebttoincomeratiohome affordabilityhousing costshousing working familieshousing working householdsworking class housingStefanos Chen2012-02-27T11:40:00 00:00Black Borrowers Face Higher Hurdles in Lending, Study Showshttp://realestate.aol.com/blog/2012/02/24/black-borrowers-face-higher-hurdles-in-lending-study-shows/http://realestate.aol.com/blog/2012/02/24/black-borrowers-face-higher-hurdles-in-lending-study-shows/http://realestate.aol.com/blog/2012/02/24/black-borrowers-face-higher-hurdles-in-lending-study-shows/#commentsFiled under: ,

lender discriminationQualifying for a loan in today's tight credit market is hard. But add race to the mix, and a borrower's odds can go from bad to worse, a new report suggests.

In a study of loans created on Prosper.com, a peer-to-peer lending website where applicants are encouraged to include a personal photo, researchers found that black borrowers are 25 to 35 percent less likely to receive funding than a white borrower with similar credit.

The report, entitled "What's in a Picture? Evidence of Discrimination From Prosper.com," studied 110,000 loan applications from the popular lending website created between June 2006 and May 2007.

"By far the biggest factor was race," said Devin Pope, co-author and assistant professor at the University of Chicago Booth School of Business. Of the 110,000 loans studied, about 5,000 were home finance or repair related.

Part of the reason for the stark discrepancy, Pope told AOL Real Estate, is that the online lending market is less regulated than its brick and mortar counterpart, where discriminatory practices are more easily identified.

But that doesn't preclude racial discrimination from real-world borrowing entirely. In fact, a closer probe of mortgage lending practices during the housing run-up revealed that African-American and Latino borrowers were more frequently offered high-interest, sub-prime mortgages than their white counterparts, even when they qualified for better terms.

The investigation led to a historic settlement in which Bank of America agreed to pay $335 million to settle widespread claims of discriminatory lending at its Countrywide unit. The Department of Justice cited over 200,000 cases in which black and Latino borrowers were charged higher fees and interest rates without regard for their credit profile.
In 2006, at the height of risky home-loan servicing, 52 percent of loans to African American families were subprime; for Latino families, more than 40 percent were subprime, according to the Center for Responsible Lending, a consumer watchdog group. By the time the housing market rights itself, some 40 to 50 percent of subprime loans will have failed, said Kathleen Day, a spokesperson for the CRL.

Other Findings

While race was the largest factor in determining loan funding, the study also detected other biases on the peer-to-peer lending site. Older and overweight applicants were 5 to 10 percent less likely to get funding, while people who looked unhappy in their photos were 10 to 15 percent less likely to close on a deal. (Pope admits that the sample size for "unhappy" applicants was considerably smaller.)

Alternatively, female applicants were actually 10 to 15 percent more likely to receive funding for their projects.

UPDATE: While the data for the study was captured between June 2006 and May 2007, Prosper.com has overhauled its lending model since the survey was conducted, according to spokesperson Laurie Azzano. The platform now uses blind bidding, which no longer allows users to post personal photos, she said.

BofA in $335M Loan Discrimination Settlement


Also see:
Landlady's 'White Only' Sign Still Not OK, Commission Says
Confederate Flag Gets South Carolina Neighbors Up in Arms
WATCH: Ornery Neighbor Scaring Off Prospective Buyers?

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More on AOL Real Estate:
Find rentals in your area.
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.

 

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]]>black homeownersblack homeownershipdevin popediscriminatory lendinghispanic homeownerslatino homeownerslender discriminationmortgagesprosper.comStefanos Chen2012-02-24T13:48:00 00:00Presidential Getaways: Live Where the Presidents Playedhttp://realestate.aol.com/blog/2012/02/18/presidential-getaways-live-where-the-presidents-played/http://realestate.aol.com/blog/2012/02/18/presidential-getaways-live-where-the-presidents-played/http://realestate.aol.com/blog/2012/02/18/presidential-getaways-live-where-the-presidents-played/#commentsFiled under:


War and peace, economic recessions, that little red telephone --it's enough to make a commander-in-chief's head spin. But when the president isn't toiling away at 1600 Pennsylvania, ever wonder where he travels to unwind? With the help of our partners at Realtor.com, we tracked down five of the most eclectic properties on the market where presidents past absconded for a breather. From an ousted president's tropical refuge in San Clemente, to the pre-Camp David era fishing retreat of presidential royalty, we highlight some of the most storied (and revealing) presidential getaways on the market today. Get to know your presidents better in the gallery below.
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Also see:
Most Popular Housing Markets
Home Affordability at Record High, Builders' Report Says

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
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]]>Stefanos Chen2012-02-18T07:00:00 00:00Foreclosure Fire Sale: Will Bulk 'REO to Rental' Program Fly?http://realestate.aol.com/blog/2012/02/15/foreclosure-fire-sale-will-bulk-reo-to-rental-program-fly/http://realestate.aol.com/blog/2012/02/15/foreclosure-fire-sale-will-bulk-reo-to-rental-program-fly/http://realestate.aol.com/blog/2012/02/15/foreclosure-fire-sale-will-bulk-reo-to-rental-program-fly/#commentsFiled under:

bank owned With an estimated 3.6 million more foreclosures expected over the next two years, the government-backed mortgage giants have a proposition for you: How'd you like to take a couple (hundred) homes off their hands?

In a recently announced program, the Federal Housing Finance Agency, which regulates the quasi-government lenders Fannie Mae and Freddie Mac, is offering qualified investors the opportunity to buy pools of foreclosed homes, provided they agree to rent the properties for a certain number of years.

In its pilot run, the foreclosure-to-rental initiative aims to shift some of the burden of managing foreclosed and vacant homes from Fannie Mae to private investors, who'll be tasked with maintaining the properties. Freddie Mac and FHA loans may be considered at a later stage of the program.

By mandating that the properties be used as rentals, the program seeks to lower rents where foreclosures have hiked up demand and to stabilize communities in the hardest-hit areas. As neighbors of foreclosure's victims know too well, vacant homes drag down prices and attract all manner of blight. Home prices nationwide have fallen 33 percent since the height of the bubble in 2006, according to the Federal Reserve.

Along with corporations, investment trusts and banks, individual investors can also get in on the action, as long as they're worth at least $1 million (though the actual barrier to entry may be higher). See the pre-qualification form here.

Behemoth Bundles

But even for the largest and savviest investors, the mortgage giants' first major foray into the foreclosure-to-rental space could prove too costly.

Donna Robinson, an Atlanta-based real estate investor and consultant, expects the foreclosure pools to range anywhere from 500 to 1,000 properties -- anything smaller, she said, wouldn't be worth bundling. Fannie and Freddie owned about 180,000 homes at the end of September, The Wall Street Journal reported. Add in FHA-owned homes, and the number rises to 215,000. Even at 1,000 homes apiece, it would take more than 200 mega-investors to work their way through the current backlog.

And while there have been reports of options being available for smaller investors, the onus will still be on major investment firms to manage the bulk of the properties, Robinson said. A spokesperson for the FHFA would not confirm the expected size of the pools.

Geographic Sprawl

If the pools are as large as Robinson anticipates, then distance is the investor's biggest enemy. While real estate investment trusts (REITs) may be comfortable in managing several hundred-unit commercial properties, operating 500 single-family residential homes (defined as up to four-unit properties) spread out across a city -- or even nationwide -- is an entirely different story.

Local compliance issues and getting properties up to snuff across a large market will take time. Investors could spend upward of a year waiting for clearance to rent their properties while carrying the day-to-day costs of maintenance, insurance and taxes, Robinson said.

Yet with risk comes reward, and Robinson expects investors to get steep discounts on their purchases. "No pro is going to pay anything above 30 to 40 cents on the dollar, tops," she said.

In the Works

With the initiative still in its infancy, much can change before the program rolls out. One way Fannie might avoid having to make huge price concessions to investors is to offer them a stake in the pools while keeping a share of the returns, suggests Nick Timiraos at The Wall Street Journal.

But whichever route the FHFA ultimately chooses, the program's success remains tethered to several larger housing factors, said Celia Chen, an economist for Moody's Analytics Inc.

Even though foreclosures will pick up in the early part of the year, home prices should start to stabilize toward the end of the year as part of the $25 billion mortgage settlement is used toward principal reduction, she said. The REO-to-rental program will take a while to kick into gear, and could benefit as a result.

But some analysts are less hopeful about the program. A report by Goldman Sachs suggests the effort will have "positive but modest" effects, with maybe a 0.5 percent increase in home prices within the first year, and a 1 percent increase in the second -- but that's a best-case scenario, the report states.

Scope is also a factor in the program's success. There are at least four times as many properties still in some stage of foreclosure as there are in the REO inventory, according to a January report from the Fed.

Correction: A previous version of this article said that Fannie Mae and Freddie Mac reportedly owned about 180,000 homes at the end of September, and that Freddie Mac-owned homes increased that number to 215,000. It is FHA-owned homes that increase that number to 215,000.

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Also see:
Billboard House Advertises a Way Out of the Housing Crisis
How the Foreclosure Settlement Could Affect You
Where Are the Real Home Bargains? Not Where You Think!

How to Save Your Home from Foreclosure

 

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]]>fannie maefhafhfaforeclosure crisisforeclosure rentalforeclosure to rentalfreddie macreal estate ownedREOreo to rentalREO to Rental ProgramStefanos Chen2012-02-15T13:51:00 00:00Bank of America Plaza to Sell at Foreclosure Auctionhttp://realestate.aol.com/blog/2012/02/06/bank-of-america-plaza-to-sell-at-foreclosure-auction/http://realestate.aol.com/blog/2012/02/06/bank-of-america-plaza-to-sell-at-foreclosure-auction/http://realestate.aol.com/blog/2012/02/06/bank-of-america-plaza-to-sell-at-foreclosure-auction/#commentsFiled under:



In today's post-bubble housing market, it's not uncommon for landmark buildings to fall into foreclosure. But this Atlanta tower is noteworthy for two reasons - it's the tallest skyscraper in the Southeast, and its sale smacks of irony.

The Bank of America Plaza, the 55-story skyscraper where BofA still holds office space, is scheduled to hit the auction block on Tuesday, the Atlanta Business Chronicle reports.

The building's current owner, BentleyForbes, fell behind on mortgage payments after buying the property from BofA and a real estate investment company in 2006.

Just as we've seen in the residential market, commercial buyers over-leveraged loans by betting on still-climbing prices. In 2006 the 1.25 million-square-foot property sold for $436 million. Today, it's worth less than half that, at approximately $202 million, Bloomberg reports.

The news comes as BofA and four other major lenders brace for what could be a record-breaking mortgage settlement, in which the nation's largest banks could face up to a $25 billion judgment for inappropriate underwriting practices known as "robo-signing."

All told, the five major lenders - Bank of America, JP Morgan Chase, Citigroup, Wells Fargo and Ally Financial - control two-thirds of the nation's mortgage servicing industry, Stateline reports. Mortgage wrongdoing has been found by every state attorney general involved in the settlement.

Perhaps spurred by the impending lawsuit, BofA announced that they're considering selling all of their corporate offices, with the exception of the New York and North Carolina headquarters.

Since the purchase by BentleyForbes in 2006, BofA has downsized its presence in the building from 400,000 square feet to under 200,000 square feet.

UPDATE: The Atlanta Journal Constitution reports that the Bank of America Plaza sold at auction to the property's bond holders for a $235 million "credit bid." That's almost half its original sales price of $436 million at the height of the bubble in 2006.



Also see:
Distressed Sales Undercut Home Prices in 2011, Study Says
Foreclosure Discount Capitals: Best Cities to Beat the Bank

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Find out how to calculate mortgage payments.
Find homes for sale in your area.
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]]>bank of america foreclosurebank of america plazacommercial real estateforeclosure auctionmortgage settlementREITsrobosigningStefanos Chen2012-02-06T15:40:00 00:00Out-of-Towners Covet Florida Real Estate, Locals Scratch Headshttp://realestate.aol.com/blog/2012/02/02/out-of-towners-covet-florida-real-estate-locals-scratch-heads/http://realestate.aol.com/blog/2012/02/02/out-of-towners-covet-florida-real-estate-locals-scratch-heads/http://realestate.aol.com/blog/2012/02/02/out-of-towners-covet-florida-real-estate-locals-scratch-heads/#commentsFiled under:

florida foreclosureThe grass is always greener on the other side - even if said yard is located in one of the states hit hardest by the foreclosure crisis.

A new report by listings company Trulia Inc. reveals that one in three home searches cross state lines, and seven out of 10 of the most popular real estate markets perused by out-of-towners are in Florida.

The study looked at listing search data between Oct. 1 and Dec. 31 that compared incoming property searches from out-of-towners against the number of outgoing searches by locals. The results were narrowed to include only listing views from at least 100 miles away from a property.

Florida Dominates Most-Desired-Properties List

In the most popular market for out-of-towners, the metro area of Palm Bay-Melbourne-Titusville, Fla., there were nearly nine times more inbound searches than outbound. This may be surprising to locals, who are intimately more familiar with the area's housing woes. One in every 205 homes in Palm Bay received a foreclosure filing in Dec. 2011, according to RealtyTrac Inc. -- more than triple the national rate of 1 in 634 foreclosure filings.

But it's not the foreclosures that are attracting house-hunters, but the price declines that they signal, said Jed Kolko, chief economist for Trulia.

Kolko told AOL Real Estate that "Florida has the worst of both worlds -- big price declines, and a slow judicial process for foreclosures" which further delays the local housing recovery.

Foreclosures in the third quarter of 2011 sold for an average 34 percent cheaper than conventional sales, according to RealtyTrac. Couple steep discounts with snowbirds' perennial quest for sunnier, happier places to live, and Florida's dominance in the report makes perfect sense.

Furthermore, because of both the huge backlog of homes in some stage of mortgage default and the slow judicial process used to mediate foreclosures in the state, Florida's home prices aren't likely to rise to anywhere near the pre-boom peak for many years. From start to finish, foreclosures take 806 days to complete in Florida, according to RealtyTrac. The national average is 348.

Popular metros outside the Sunshine State include Tulsa, Okla., the Riverside-San Bernadino-Ontario area of California, and South Carolina's Charleston-North Charleston-Summerville region.

Where Homeowners Want Out

On the flip side, Trulia calculated the top metro areas where locals are looking elsewhere for real estate. By calculating the ratio of outbound listing views to local listings, they arrived at a list of mostly bigger (and comparatively more expensive) cities where residents are searching for a way out.

Topping the list is the area of Newark, N.J, and Union, Pa., where more than three times as many outbound listings were viewed than local ones. San Jose, Calif., Washington, D.C., Philadelphia and Bethesda, Md., rounded out the top five.

But whether prospective homebuyers are looking to buy in or get out, what's driving their search behavior is affordability, Kolko observed. That said, today's looky-loos may not necessary become tomorrow's buyers -- tight credit and larger down-payment requirements may stop many house-hunters in their tracks. When the economy begins to shift, however, expect many of these markets to reap the benefits of pent-up demand.




CORRECTION: A previous version of this article referenced Palm Beach as part of the Melbourne-Titusville, Fla., metro area. It should have identified that city as Palm Bay.

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See also:
Foreclosure Action at Lowest Level Since 2007
Foreclosure Discount Capitals: Where They're Worth It

 

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]]>best housing marketsflorida foreclosuresForeclosure Discountsmost wanted real estatetruliaStefanos Chen2012-02-02T08:05:00 00:00MLK, USA: Many King Streets Stuck on Economic Outskirtshttp://realestate.aol.com/blog/2012/01/17/mlk-usa-many-king-streets-stuck-on-economic-outskirts/http://realestate.aol.com/blog/2012/01/17/mlk-usa-many-king-streets-stuck-on-economic-outskirts/http://realestate.aol.com/blog/2012/01/17/mlk-usa-many-king-streets-stuck-on-economic-outskirts/#commentsFiled under: ,

martin luter king jrTwenty-six years after the Rev. Martin Luther King Jr. was first honored with a holiday, his legacy has flourished -- and not just in the annals of history. Today, there are more than an estimated 900 streets in America that bear the civil rights leader's name.

But even as the memory of King remains at the heart of American discourse, many of his namesake streets are drifting further to the social and economic periphery.

"There tends to be a marginalization of King's name," Derek Alderman, professor of geography at East Carolina University, told AOL Real Estate. Alderman, who has spent the better part of a decade chronicling the number of streets named after the slain civil rights leader, has encountered the paradox many times before -- beloved as the man may be, in real estate, some homebuyers and store owners ascribe a kind of stigma to the name.

Using Realtor.com's database of homes on the market, an analysis of properties on Martin Luther King Jr. streets lends some credence to that view. In 2010, the median list price for homes with "Martin Luther King Jr." in the address was $79,900. By 2011, it had fallen to $69,900, a 12.5 percent decrease. The U.S. median list price was more than twice that last year, at $170,000, and saw only a 4.7 percent drop in the same period, according to the National Association of Realtors. (In the gallery below, see a random sampling of homes on MLK streets.)

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In many ways, Alderman said, it's a case of perception becoming reality. Residents and business owners oppose the renaming of thriving streets because of an unfounded fear that the civil rights leader's name may hurt property value. Instead, the commemorations of King, who was assassinated in 1968, are often quite literally pushed to the margins of town, on streets of communities that are already economically challenged.

"When a street's name means something [to property value] it's because of the location," said Alice Palmisano, executive director of Brown Harris Stevens Appraisal & Consulting Co. in New York City. "Park Avenue means something because it's in a great neighborhood," not because the name has some intrinsic real estate value.

Compounding the problem for many of these predominantly African-American communities was the rampant predatory lending that plagued poorer neighborhoods during the sub-prime mortgage run-up. In fact, the Justice Department is now seeking to repay more than 200,000 minority borrowers who were steered toward high-interest subprime loans when many qualified for better terms. The search is part of a historic $335 million discriminatory lending settlement levied against Bank of America's Countrywide Financial unit.

But to write off the more than 900 streets that pay homage to King as "struggling" would be wide of the mark, said the Rev. Terence Dicks, project director of the "Claiming a Street Named King" program in Augusta, Ga.

There are several prominent examples of MLK streets with healthy economies and rich cultural legacies, such as the ones in New York City, Austin and, of course, King's hometown of Atlanta. But Dicks' project aims to take an accounting of the problems faced by MLK throughways that continue to face economic hardship.

"I want to see an area meant for bad, used for good," he said, referring to the stigma accompanying many of the streets -- especially when King's legacy is at stake. "Young people do not remember Dr. King as well as they should," and the negativity being attributed to the streets named in his honor is not helping matters.

Alderman, who has collaborated with the grassroots project, echoes his sentiment.

"There's just no way that Martin Luther King's name causes poverty."

Also see:
Landlady's 'White Only' Sign Still Not OK, Commission Says
Messy Yard Brings Jail Time for SC Woman, Then Help

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]]>Martin Luther King AveMartin Luther King Blvdmartin luther king dayMartin Luther King Jr.martin luther king streetsMLKMLK blvdMLK dayStefanos Chen2012-01-17T15:48:00 00:00Foreclosure Actions at Lowest Level Since 2007http://realestate.aol.com/blog/2012/01/12/foreclosure-activity-at-lowest-level-since-2007/http://realestate.aol.com/blog/2012/01/12/foreclosure-activity-at-lowest-level-since-2007/http://realestate.aol.com/blog/2012/01/12/foreclosure-activity-at-lowest-level-since-2007/#commentsFiled under:

foreclosure ratesAfter a year marred by red tape and mortgage lender malfeasance, foreclosure activity in 2011 fell to the lowest annual rate since the housing crisis began more than four years ago, according to data released Thursday.

Foreclosure filings -- which include default notices, scheduled auctions and bank repossessions -- were recorded on 1.9 million homes in 2011, down 34 percent from 2010, the foreclosure database company, RealtyTrac, said.

In real terms, 1.45 percent of homes, or one in 69, were in some stage of foreclosure in 2011. That's down from 2.23 percent in 2010, 2.21 percent in 2009, and 1.8 percent in 2008. Both key metrics in 2011 were at their lowest rate since 2007, when home prices started to tank in several markets.

But the latest figures are less a sign of recovery than a reflection of widespread delays in foreclosure processing.

"It's not that the market is all of a sudden staging a dramatic recovery," said RealtyTrac spokesperson Daren Blomquist in an interview with AOL Real Estate. "It's just that lenders are taking their time for a variety of reasons."

Principal among those reasons is the ongoing (and seemingly never-ending) negotiations for a nationwide mortgage settlement between the country's biggest banks and a coalition of state attorneys general.

A proposed $25 billion lawsuit aims to take lenders to task for a number of fraudulent foreclosure proceedings collectively referred to as "robo-signing" during the height of the housing bubble. As the investigation lurches forward, local courts have been inundated with claims of wrongful foreclosure, especially in states like Florida, where judicial action is necessary to repossess homes with delinquent mortgages.

(See a full list of judicial foreclosure states here.)

Not surprisingly, Florida is "ground zero for dysfunctional foreclosure processes," Blomquist said. While there has been almost a 63 percent decrease in foreclosure activity over the last year in the hard-hit state, he said that the time it takes to complete the process has gone up 48 percent in the same time period. From start to finish, he said, foreclosures take an average of 806 days in the Sunshine State -- the national average is 348.

Closer to 'Reality' in Arizona

But while the widespread legal delays may mask the underlying problems facing the housing market, Blomquist said that foreclosures would have fallen in 2011 regardless -- just not so dramatically.

For a sense of what the road to recovery really looks like, Blomquist offered Arizona, another state suffering from high foreclosure rates, albeit under different circumstances than Florida.

Foreclosures are down there, too, but as a non-judicial state, Arizona has been far more expedient in getting distressed properties on the market and out of the courts. The average foreclosure process in Arizona takes 173 days, far below the national average of 348.

The problem across the board, though, is that once foreclosures hit the market their effect on neighboring properties can be severe. Foreclosures typically sell at a 20 percent discount, according to the National Association of Realtors, and that can drag comparable homes' value down fast.

Facing Facts

December marked a 49-month low for monthly foreclosure activity nationwide. The state with the longest foreclosure processing time by far is New York, with an average of 1,019 days to completion in the fourth quarter. New Jersey and Florida rounded out the top three with 964 days and 806 days, respectively.

But as counterintuitive as it may sound, Blomquist said, the recovery won't truly take off until more foreclosures are processed and the backlog of distressed properties is brought back to normal inventory levels.

'We've been deferring a lot of these foreclosures," he said. "So at some point the market needs to face reality and deal with them."



Also see:
Bank Sues Couple for Title Typo They Didn't Make
Up in Smoke: House Fire Reveals Huge Marijuana Operation
Improving Housing Markets Nearly Double, New Data Says

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]]>foreclosure actionsforeclosure activityforeclosure crisisforeclosure ratesforeclosuresnational mortgage settlementrealtytracReatyTrac foreclosuresrobo signingrobo-signingStefanos Chen2012-01-12T00:10:00 00:00The Minor Threat: Age-Restricted Communities Evicting Childrenhttp://realestate.aol.com/blog/2012/01/06/the-minor-threat-age-restricted-communities-evicting-children/http://realestate.aol.com/blog/2012/01/06/the-minor-threat-age-restricted-communities-evicting-children/http://realestate.aol.com/blog/2012/01/06/the-minor-threat-age-restricted-communities-evicting-children/#commentsFiled under:



At 6 months old, Kimberly Broffman faced eviction.

It wasn't because her grandparents couldn't afford the home where she lived -- they were current on the mortgage. And it had nothing to do with her mother's run-ins with the law; she was welcome to stay, too. The only persona non grata was the infant, and she had to leave soon.

The reason: Kimberly's grandparents -- and primary caregivers -- live in an age-restricted community, where minors are treated more often as vagrants than visitors.

Judie and Jim Stottler (pictured above with Kimberly), who belong to the Lakes Homeowners Association in Clearwater, Fla., have been in and out of court to keep Kimberly in their home since she was 3 years old, though the community board first raised objections when Kimberly was just an infant. She's 8 today.

The couple gained legal custody of Kimberly because her mother had a history of substance abuse. The father remains unknown. Without her grandparents, Kimberly would likely be placed in foster care.

But when the community board discovered that the child was living year-round with her grandparents, they issued an ultimatum: Remove the child or sell the house within 18 months.

"Throwing the child out would be throwing us out," Judie Stottler, 64, told AOL Real Estate. "People end up losing their homes because they won't lose their children."

The Stottlers are hardly alone. As the economic downturn bears down on families, an increasing number of grandparents are stepping in to raise their grandchildren, and it's presenting a host of complicated issues, both legal and ethical, particularly when it comes to senior housing.

A Major Problem With Minors

At the Sun City Community Center near Tampa, Fla., one of the oldest age-restricted communities in the nation, the problem is growing.

Ed Barnes, president of the board, said that he's discovered 10 cases in the past six months in which children were found to be living with relatives -- one of the most basic violations of age-restricted communities' bylaws.

But Barnes doesn't relish the thought of kicking children to the curb.

"Certainly the main reason is the economic downturn, coupled with personal tragedies," he said of the influx of youngsters. "People are getting divorced and have no alternative, no job, and have to find some place for the kids to live."

With a national unemployment rate of nearly 9 percent and millions of Americans still struggling with upside-down mortgages, it's not surprising that there are more multigenerational households these days. Yet bending the rules for even one child could land an age-restricted community in hot water.

Legal and Financial Consequences

"Age restriction is a fundamental part of what makes up that community," said Michael Gelfand, a West Palm Beach-area attorney with experience in community association disputes. Putting aside residents' attitudes about young children, sheltering minors could put the community under serious financial duress.

The Fair Housing Act, which forms the basis for anti-discrimination law in housing, was amended to include a "familial restriction" that essentially validates senior communities' right to prohibit minors from living there, Gelfand said.

Up to 20 percent of residents in age-restricted communities can be under the set residency age, but these arrangements are largely used to accommodate adult children who inherit property. The rule is never used to accommodate minors, however, and if a community is found to exceed the 20 percent limit, or selectively enforces the rules, it could lose its exemption status. And that could cause a cascade of adverse effects.

The perception is that "property values are going to plummet," said Rob Freedman, a Tampa-based attorney who's written covenants for several age-restricted communities in Florida. "Because now you have more people coming in ... and because senior citizens are not going to want to live in a community that has kids around."

Moreover, senior communities aren't equipped for children, Freedman said. Swimming pools and other adult facilities will have to be reinsured; lightly used roadways will take a pounding as younger residents move in, creating safety hazards for golf cart-reliant seniors and increased taxes for residents; and mortgage lenders will likely be forced to revise their valuation of the community, making it harder for borrowers to change terms.

For seniors on a fixed income, any number of these changes could lead to hardship. The median listing price in Sun City is $104,950 as of November, which is down 4.5 percent from last year, according to Realtor.com data. In comparison, the national median list price was $189,900.

U.S. Census data shows that 5.8 million children under the age of 18 live in grandparent-headed households as of the last decennial survey, up from 4.5 million a decade ago. And while residents in age-restricted communities make up just under a million owner-occupied households in America, according to the National Association of Home Builders, economic hardships are bringing more of these eviction cases to the surface.

A Slippery Slope

The problem isn't entirely new. Take for instance the cautionary tale of Youngtown, Ariz., credited as the first age-restricted community in the nation. In 1996, 16-year-old Chaz Cope moved in with his grandparents in the senior community to escape his abusive stepfather.

Cope's grandparents petitioned the association to allow the teenager to stay with them until he finished high school, but the board bristled.

Chaz Cope"It was scary. I didn't have nowhere else to go and I definitely wasn't going back to that abusive household," Cope, now 31, told AOL Real Estate. (He's pictured left with his 4-year-old daughter.)

But when the story garnered mainstream attention, the Arizona attorney general's office ordered a stay on Cope's eviction and initiated a 10-month investigation of the community. It turned out that the town had improperly sought its age-restricted status and the town lost its exemption altogether, allowing Cope -- and anyone else inclined to live among a majority of seniors -- to move into the community.

"I made it so anybody could live in that community," Cope said, with a measure of pride.

Kids in the Shadows

Cope's story is a sobering example of what's at stake for 55-and-up communities that discover children in their midst. In Sun City Community Center, president Barnes said that he's seen more stowaways lately, but that the problem still only affects a small portion of the 10,000-plus population. But AOL Real Estate spoke to residents who claim that there are many children who remain hidden.

"Oh my goodness -- shock-o, shock-o," one resident quipped when informed of the recent discoveries. The homeowner, who asked not to be identified, said that she's seen several children peeking out from behind screen doors in the seven years she's lived at Sun City.

The reasons they live in the shadows are clear to Judie Stottler, whose 8-year-old grandchild has been at the center of controversy since she was an infant.

Kimberly BroffmanThe family has been battling to keep Kimberly since before she could crawl, but has had the services of attorney Rob Eckard for the past 5 years. Eckard, who first read about the Stottlers' case in the local press, came on to defend the family pro bono.

"People who can't afford attorneys end up losing their home because they won't lose their children," Stottler said. Before they had legal representation, the family signed an agreement stating that they would move out of the home within 18 months. "We thought we'd have to sign or we'd be thrown out right then."

But when the housing market went belly up, they were left with little hope of selling. The home was first listed in 2006 for $250,000, Stottler said -- now it's priced at $89,000.

Stottler works at a local assisted living home and supports the family entirely on her income. Her husband, Jim, is disabled. She expects to retire this February.

To make matters worse, the community board president, whom the family had dealt with, recently died, leaving their lawyer with the arduous task of restarting negotiations.

But there's hope for them yet. Because the family was granted custody of Kimberly during a separate hearing, Eckard said, there may be grounds for setting up a temporary zoning variance that would allow the Stottlers to keep their home, as well as their granddaughter.

A Case for Revision

The problem with these cases, even when the children are granted admission to the community, is that they're won on technicalities, said Shelley Cutts, a Tempe, Ariz., attorney who studied the Cope case.

State attorneys general sometimes intervene in these cases, "but never have to answer the tough questions," she said -- namely, revising the laws to include a hardship exemption for families with no other options.

For the time being, however, families like the Stottlers face uphill battles in court, where their best defense is to find flaws in their community's bylaws.

As of Wednesday, Eckard, the family's attorney, said the association was very close to reaching a deal with the Stottlers to allow Kimberly to stay on a temporary zoning exemption. The proposal was very careful to maintain the community's age restricted status, he says -- the offer would only be extended to Kimberly, and no other children found in the community. As of this writing, the community association's attorney has yet to respond to calls regarding the case.

Eckard says he's already been approached by another resident in the Lakes subdivision who is sheltering a minor and fears community reprisal.

"There's people in that community just one event away from being in their shoes," he said.

Until a policy is reached that both maintains age-restricted enforcement and considers extreme family hardship, residents within these communities will continue to have to choose between keeping their homes and housing their kin.

But Stottler said she already knows where she stands.

"Your child is going to come first. That's just the way it is."

Special thanks to Professor Judith Trolander, whose insights helped inform this article.

Also see:
Housing Market Unprepared for Aging Gay Community
Survey: Most Boomers Would Cover Kids' Down Payment

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]]>age+restricted+communitiesage-qualified communitiesage-restrictedagerestrictedcommunitieschaz copeclearwater floridajudie stottlerkimberly broffmanlakes homeowners associationsenior communitiessun city community centeryoungtown arizonaStefanos Chen2012-01-06T06:00:00 00:00Bernanke: Fed Should Help Turn Foreclosures Into Rentalshttp://realestate.aol.com/blog/2012/01/05/fed-seeking-nationwide-foreclosure-rental-program/http://realestate.aol.com/blog/2012/01/05/fed-seeking-nationwide-foreclosure-rental-program/http://realestate.aol.com/blog/2012/01/05/fed-seeking-nationwide-foreclosure-rental-program/#commentsFiled under: ,

reo propertyMost of Washington's initiatives to staunch the flow of foreclosures glutting the housing market have been woefully inadequate. (We're looking at you, HAMP, HAFA and HARP). But a new idea put forth by Federal Reserve Chairman Ben Bernanke might actually make a dent in the bank-owned backlog: Allow renters to move into foreclosures.

HousingWire reports that the chairman endorsed the idea in a letter sent Wednesday to ranking members of the House Committee of Financial Services.

If prolonged foreclosures and dicey mortgage origination is holding back the recovery, he wrote, then filling up the nation's vacant (and otherwise deteriorating) homes with renters might be the best way to cut losses and protect investments.

In a preliminary study of Fannie Mae's REO inventory -- foreclosures in which the lender owns the property because they couldn't unload it -- two-fifths of the homes showed more potential as rentals than as resales. For foreclosures purchased with Federal Housing Administration (FHA) loans, the rent potential is even higher, since homes secured through FHA loans (a favorite of first-time buyers) tend to sell for less.

Part of the problem, as owners in some of the hardest-hit states will attest, is that vacant homes invite all sorts of calamities for prospective buyers. In humid climes like Florida, mold can ravage even the best built homes, and vandals and squatters can cause damage that far exceeds the value of some foreclosed properties.

Keeping foreclosed homes occupied could also have the added benefit of protecting neighborhood property value, which is a major concern for sellers and the countless others not yet willing to attempt a sale. The National Association of Realtors estimates that foreclosures typically sell at a 20 to 25 percent discount, which drags neighboring properties value down. Zillow estimates that homes lost $700 billion in value in 2011 alone.

With fears running high that the FHA might need a bailout in 2012 if the market doesn't improve, renting foreclosures might be a welcome cost-saving measure to preserve the administration's coffers.

Of course, it also couldn't hurt if those homeowners evicted through foreclosure are allowed to stay in their homes through the rental program.

Also see:
Foreclosures Could Be on the Rise Again, Report Says
Study: Foreclosure Process Time Has Doubled Since 2007

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]]>bank owned propertyBen BernankeFederal Housing Administrationfederal reservefha loanshafahampharpreo propertiesreo rental programStefanos Chen2012-01-05T13:30:00 00:00Tennessee Home Burns as Firefighters Watchhttp://realestate.aol.com/blog/2011/12/07/tennessee-home-burns-as-firefighters-watch/http://realestate.aol.com/blog/2011/12/07/tennessee-home-burns-as-firefighters-watch/http://realestate.aol.com/blog/2011/12/07/tennessee-home-burns-as-firefighters-watch/#commentsFiled under:

For one Tennessee family, perhaps the only thing worse than watching their home burn down was watching the firetrucks hang back as it was engulfed in flames.

Near the rural town of South Fulton, Tenn., outlying homeowners are required to pay a subscription fee to subsidize the fire department, local TV station WPSD reports. But when that $75 annual fee goes unpaid, homeowners like Vicky Bell find out the hard way what noncompliance entails.

After Bell reported that her mobile home was on fire, the fire department arrived, she told WPSD -- but they wouldn't intervene.

And yet, this is not the first time when the town's controversial "pay for spray" policy has rankled residents and drawn national attention. Last year, local resident Gene Cranick called in the fire department to save his double-wide mobile home on the outskirts of town, but he too had failed to pay the annual fee.

Instead, firefighters arrived to protect the property of Cranick's neighbor, who had paid the $75. The decision sparked public outrage, and the International Association of Fire Fighters issued a press release condemning the South Fulton policy, stating that the department's decision was "incredibly irresponsible."

Admittedly, homeowners in both cases were aware of the annual subscription fee, but still failed to pay. The fact that firefighters arrived on the scene in both cases, however, but refused to aid the victims, has drawn major criticism.

Still, the practice has its supporters. Mayor David Crocker stands behind the policy, he told WPSD, because the department depends on the subscription fee to cover the outskirts of town. Crocker said that firefighters will help when people are actually placed in danger, whether or not they've paid the fees, The Associated Press reports.

But considering a recent statistic showing that house fires in modern homes can become uncontrollable in less than 3 minutes, that claim may be suspect.



Tennessee Firefighters Watch as Home Burns

Also see:
Home Allegedly Set Afire in Neighbors' Facebook Feud
Apartment Fire Safety Tips

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]]>firefightersgene cranickhome firesobion countypay for spraysouth fultontenessee housingvicky bellStefanos Chen2011-12-07T09:35:00 00:00Man Sells Sister's Home as She Was Cloistered in Nunneryhttp://realestate.aol.com/blog/2011/12/05/man-sells-sisters-home-while-she-was-cloistered-in-nunnery/http://realestate.aol.com/blog/2011/12/05/man-sells-sisters-home-while-she-was-cloistered-in-nunnery/http://realestate.aol.com/blog/2011/12/05/man-sells-sisters-home-while-she-was-cloistered-in-nunnery/#commentsFiled under: ,

Teresa Nadia PedullaSibling rivalry is one thing, but swindling this sort of sister crosses the line.

Teresa Nadia Pedulla, an Australian homeowner who had been living abroad with an order of Italian nuns, is being awarded $3.8 million by the New South Wales government after her brother illegally sold her estate, according to The Sydney Morning Herald.

Pedulla, who had left her Sydney home for more than five years to live in cloisters with the nuns, discovered that her brother and two accomplices had taken out several mortgages against the home in her absence, and finally sold it for $3.8 million in March of this year.

The brother, Fernando Rene Panetta, and his wife Anna Lam each made off with $684,890.92, the Sydney Morning Herald reported. They left the country on separate flights and their whereabouts remain unknown.

A third accomplice, Lewis Fineman Yee, is charged with fraudulently claiming to be Pedulla's attorney and helping to illegally transfer the property to her brother for the nominal fee of $1.

As if the circumstances of the theft were not sensational enough, it was revealed in court that Yee has had a long-term intimate relationship with Anna Lam, who has presumably absconded with her current husband and co-conspirator, Fernando Panetta.

And while the details of the Pedulla case may seem outlandish, title deed fraud is becoming increasingly common, especially in the hardest-hit states of America. In Florida, homeowners are especially prone to a scheme known as "quitclaim fraud."

The combination of a vast inventory of vacant homes, coupled with Florida's very public property records, allows scammers to forge signatures, steal personal information, and ultimately claim ownership before the bona fide owner is even notified of the transfer. Learn how to protect yourself from quitclaim fraud in this post from AOL Real Estate.

While Sydney's legal system may have intervened on this victim's behalf, justice is not always so swift back stateside.

See also:
'Quitclaim' Foreclosure Scam Could Cost You Your Home
Victims of 'Robo-Signing': Fight the Machine!

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]]>Anna Lambrother cheats nunbrother sells nuns homebrother steals nuns homeFernando Rene PanettaLewis Fineman Yeenew south walesnun fraudnunsquitclaim fraudsydneyTeresa Nadia Pedullaweird newsStefanos Chen2011-12-05T15:15:00 00:00Survey: Most Boomers Would Cover Kids' Down Paymenthttp://realestate.aol.com/blog/2011/11/30/survey-most-boomers-would-cover-kids-down-payment/http://realestate.aol.com/blog/2011/11/30/survey-most-boomers-would-cover-kids-down-payment/http://realestate.aol.com/blog/2011/11/30/survey-most-boomers-would-cover-kids-down-payment/#commentsFiled under:

baby boomers Baby boomers may be in a better position than most to buy homes, but not before helping Junior out of a bind. A national survey found that at least two-thirds of boomers age 45 and up want to help their children or grandchildren with a home down payment.

The study, conducted by Meredith Research Solutions for Better Homes and Gardens Real Estate, polled a random sampling of 1,100 adults over 45 who had at least one child or grandchild over 18.

The results overwhelmingly show a generation that still appreciates the value of homeownership, despite their children's difficulties in the market. One in five boomers stated that they've already loaned money, co-signed a mortgage, or given a cash gift to children for a down payment. When asked why they're willing to help, 75 percent said that it was still a good investment for their children, while 58 percent still think that homeownership is part of the American Dream.

And it's not just wealthier boomers who hold these beliefs. While the study found that boomers who make more than $75,000 are the most likely to offer financial help, roughly 46 percent of those who said that they will definitely contribute to their children's home purchase made less than that. Within that group, 30 percent made less than $50,000 in household income.

For recent college graduates, the results should come as a relief. At least 41 percent of students are returning to their parents' home after graduation, saddled with huge college debt and grim job prospects. Many others opt instead to never leave the family home, either by delaying college or commuting to a local school.

But helping the kids move out sooner may come at a high cost for boomers on a fixed income. Homeowners of middle age and older typically have more equity in their home and are better candidates for reverse mortgaging. But as more of boomers' savings go toward securing their children's futures, less financing may be available for their own move. And fewer boomers moving means a smaller pool of qualified buyers.

First-time homeowners may be the future, but it's the repeat buyers who have the means to put down a substantial cash sum at closing.

And while respondents cited "love" as a top consideration in shelling out for their kin, another frequent reason is lighter on sentiment, heavy on foreboding. One in five boomers -- who said that they have helped or likely will help with a loan to their children -- said that their kids couldn't afford the home without them.



See also:
Forget Empty Nesters, We Now Have 'Full Nest Syndrome'
Will Baby Boomers Rock the Housing Market?

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]]>baby boomersboomerang kidsfirst time home buyersfirst time homebuyer down paymenthome down paymenthousing crisisretireesreverse mortgagessenior livingStefanos Chen2011-11-30T08:30:00 00:00Rent This Way: Lady Gaga's Pre-Stardom Pad Hits Markethttp://realestate.aol.com/blog/2011/11/21/rent-this-way-lady-gagas-pre-stardom-pad-hits-market/http://realestate.aol.com/blog/2011/11/21/rent-this-way-lady-gagas-pre-stardom-pad-hits-market/http://realestate.aol.com/blog/2011/11/21/rent-this-way-lady-gagas-pre-stardom-pad-hits-market/#commentsFiled under:

lady gaga apartmentGet your paws up and your checkbooks out, little monsters. The one-bedroom Lower East Side apartment where starving artist Stefani Germanotta became Lady Gaga is back on the market.

For $1,850 a month, you too can experience the pre-stardom glow of living well beyond your means in the hope of making it big.

A tour of the property today, though, doesn't exactly bear Gaga's shock-pop stamp. Conspicuously absent are the sequins, flaming pianos and meat fabric we've come to expect from the mercurial pop star.

lady gagaIn true New York fashion, the three room apartment includes a kitchen-cum-living room, a tight-fitting bedroom, and a closet-size bathroom perfect for recording YouTube's next viral sensation. But it's a small price to pay to live in walking distance from the much revered Bowery Ballroom, where today's struggling acts become tomorrow's chart-topping stars.

The listing agent, John English for CitiHabitats, did not immediately return our calls.

Watch the video clip below for a glimpse inside the apartment (not to mention Gaga getting unceremoniously locked out of the apartment by its next tenant).



See also:
Rent Oprah's Chicago Co-op for $15,000 a Month
Divorcing? Don't Do What Demi May Have Done
Longtime Resident k.d. lang Lists Laurel Canyon Home

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]]>celebrity real estatedowntown new yorkJohn English CitiHabitatslady gagaLady Gaga apartmentLady Gaga Bowery BallroomLower East Side apartmentnew york real estateStefani GermanottaStefanos Chen2011-11-21T14:43:00 00:00FHA Loan Limit Raised, Despite Oppositionhttp://realestate.aol.com/blog/2011/11/18/fha-loan-limit-raised-despite-opposition/http://realestate.aol.com/blog/2011/11/18/fha-loan-limit-raised-despite-opposition/http://realestate.aol.com/blog/2011/11/18/fha-loan-limit-raised-despite-opposition/#commentsFiled under:

FHA loanCongress moved to raise the loan limit for mortgages backed by the Federal Housing Administration on Thursday, despite some lawmakers' fears of artificially propping up the market.

The bill increased the ceiling on the loans to $729,750, up from $625,500 in October, says The Wall Street Journal. The loan limit had been raised to this level before in an attempt to promote homeownership during the height of the recession, but it was allowed to expire, The Associated Press reported.

With as little as 3.5 percent down payment required to close on an FHA loan, the program has long been promoted as an option for first-time homebuyers. But critics have claimed that the higher loan limit exceeds the needs of most first-time buyers and places too much pressure on the federal government to subsidize housing.

On the other hand, proponents of raising the limit argue that historically expensive markets, like New York and San Francisco, require the FHA to raise their ceiling to be useful to buyers. Around 600 counties were affected by the FHA loan limit drop in October.

The bill was not without compromise, however. Proponents in the House and Senate had to shed a similar limit raise on loans held by government-sponsored mortgage giants Fannie Mae and Freddie Mac. The limit placed on the two major mortgage finance companies remains at $625,500.

The news comes after an audit of the FHA revealed that there is nearly a 50 percent chance that the administration will require a federal bailout next year if the market worsens, according to The New York Times. The FHA, which was founded in 1934 in the wake of the Great Depression, has seen much of its cash reserves dwindle in the past few years, as mounting foreclosures cost the agency billions in insurance claims. The administration is down to $2.6 billion in cash reserves, down from $4.7 billion last year, the Times reports.

To learn more about first-time buyer mortgage options, watch the video below.




Also see:
Open Houses of the Week: Golden Opportunities for Retirees
When It Comes to Mortgages, Women Don't Shop Enough
Feds Target Loan Mod Scams, With Google's Cooperation

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]]>Stefanos Chen2011-11-18T13:42:00 00:00Budding Trend: Foreclosed Homes Converted to Pot Gardenshttp://realestate.aol.com/blog/2011/11/15/budding-trend-foreclosed-homes-converted-into-pot-gardens/http://realestate.aol.com/blog/2011/11/15/budding-trend-foreclosed-homes-converted-into-pot-gardens/http://realestate.aol.com/blog/2011/11/15/budding-trend-foreclosed-homes-converted-into-pot-gardens/#commentsFiled under:



The housing market isn't the only thing that's gone to pot in Las Vegas.

With the foreclosure crisis in high gear, some enterprising residents are converting vacant homes into marijuana grow sites, the Los Angeles Times reports.

In one raid, Vegas police discovered 61 plants in a recently foreclosed four-bedroom home. In another, they confiscated 878 plants worth approximately $2.6 million.

The budding trend's growth coincides with the city's wildly speculative housing boom and subsequent bust. In 2005, when home prices were still rising, there were 18 recorded pot sites and 1,000 confiscated plants in the state. In 2010, police raided 153 indoor operations and nabbed 13,000 plants, according to the Times.

In October, one in every 180 homes in Nevada received a foreclosure filing -- more than three times the national average of one in 563, says RealtyTrac, a foreclosure analytics company. In large part due to the foreclosure backlog, property value in Las Vegas dropped from $317 per square foot in 2006 to $138 per square foot in 2010, according to the National Association of Realtors.

Vacant homes, as we previously reported, fall prey to grifters of all stripes. In Bay Shore, N.Y., a couple found themselves the victims of a criminal trifecta -- squatters, scammers and thieves. While Richard and Lisa Scott waited for their bank to approve short sale offers on their foreclosed home, the property was vandalized by squatters, fraudulently rented out on Craigslist and finally stripped of its copper plumbing by robbers.

And even when no criminal activity is involved, vacant homes are vulnerable to another threat: mold. In humid states like Florida -- which, incidentally, also teems with foreclosures -- vacant homes can succumb to the effects of mold and mildew in a matter of weeks, and the damage can quickly add up.

There are, however, at least a few rare instances in which vacant homes yield pleasant surprises. While making repairs to a home in Florida, a plumber discovered $20,000 hidden in an air duct. It turns out that the previous owner, a widow with an apparent aversion to banking, took to hiding cash in the home for her next of kin. The altruistic plumber turned the money over to the police.

See also:
Vacant House Yields Late Owner's Stash of Cash
Vacant Home Targeted By Squatters, Scammers and Thieves

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]]>cannibisforeclosure crisisLas Vegas abandoned homeslas vegas foreclosuresLas Vegas pot growing homesmarijuanapotsquattersvacant homesStefanos Chen2011-11-15T14:40:00 00:00Hot Stat: Today's Homes Burn Faster Than Everhttp://realestate.aol.com/blog/2011/11/07/hot-stat-todays-homes-burn-faster-than-ever/http://realestate.aol.com/blog/2011/11/07/hot-stat-todays-homes-burn-faster-than-ever/http://realestate.aol.com/blog/2011/11/07/hot-stat-todays-homes-burn-faster-than-ever/#commentsIt may sound like a cliche to trot out fire safety tips before the holiday season, but if there's one statistic that bears repeating, it's this: Even with adequate smoke alarms, a house fire today can become uncontrollable in less than three minutes.

That's down from an average 17 minutes in 1975 -- a whopping 82 percent difference.

And the reason for the drastic change, according to a report by the National Institute of Standards and Technology, isn't just the type of house you live in, but what you put inside.

"It's not how old the home is, it's the furnishings," Jack Watts, Director of the Fire Safety Institute, told AOL Real Estate.



A spokesperson for the National Association of State Fire Marshals told AOL Real Estate that the worst culprit in home fires is upholstered furniture, because it often contains highly flammable polyurethane foam. These all-too-common materials provide the fuel for what fire experts call the flashover -- the point at which everything in the room simultaneously bursts into flames. It doesn't help that many of today's homes are built with more open floor plans and modern building materials like wallboard that can lead to faster fires, according to the Wichita Eagle.

The numbers show an alarming trend. In 1977, the first year when data was available, there were 750,000 residential fires, according to the National Fire Protection Association. In 2010, there were roughly half that many, thanks in large part to widespread use of smoke detectors. But the incredible speed with which home fires can spread in today's homes represents a major step backward in fire safety.

The Hot Topic of Sprinklers

The next step in home fire safety, a spokesperson for the NASFM said, is to require fire sprinklers in new residential properties. Homebuilders bristle at the idea due to the high cost of installation. The national average cost to install sprinklers is $1.60 per square foot, according to the Wichita Eagle. In a 2,000-square-foot home, that comes out to about $3,200.

Another barrier is public opinion. As we reported last year, when given the choice between granite countertops and fire sprinklers, respondents overwhelmingly chose the countertops, according to the National Association of Home Builders.

(To find out if your state requires fire sprinklers in new construction, check out the Fire Sprinkler Initiative website.)

Worse still, there are only voluntary flammability regulations for upholstered furniture. Implementing a nationwide standard would go a long way in protecting consumers from purchasing dangerously flammable furnishings, the NASFM spokesperson said.

Regardless of what state legislators decide, though, it all comes down to vigilance, says Fire Safety Institute Director Watts.

If you'll be using a live Christmas tree this holiday season, make sure to water it regularly and keep an eye on any decorative lighting and candles. And, as always, make sure your house is equipped with working smoke and carbon monoxide detectors. For a terrifying glimpse at a Christmas tree "flashover," watch the video above.

Also see:
Home Allegedly Set Afire in Neighbors' Facebook Feud
Mortgage Rates Stay Low, But Homebuyers Aren't Budging

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]]>Fire Safety Institutefire sprinklers in the homeflammable furniturehome fire safetyNational Association of State Fire MarshalsNational Fire Protection AssociationNational Institute of Standards and TechnologyStefanos Chen2011-11-07T17:55:00 00:00BofA Threatens Family With Foreclosure Over $1 'Coding Error'http://realestate.aol.com/blog/2011/11/04/bofa-threatens-family-with-foreclosure-over-1-coding-error/http://realestate.aol.com/blog/2011/11/04/bofa-threatens-family-with-foreclosure-over-1-coding-error/http://realestate.aol.com/blog/2011/11/04/bofa-threatens-family-with-foreclosure-over-1-coding-error/#commentsFiled under: ,

$1 foreclosure utahWhen Shantell Curtis sold her Vernal, Utah, home last year, she expected, as a reasonable person might, that she'd paid her last mortgage payment on the house.

But her lender, Bank of America, thought differently, according to KUTV 2News in Utah. Because of a $1 "coding error" on the bank's part, the title to Curtis' home was never transferred to the new owners, making it appear as if she still owned the home. As a result, BofA initiated a foreclosure process on the home and reported Curtis to the credit bureaus, effectively obliterating her credit score.

Now Curtis is left to pick up the pieces for a mistake that was not her own, on a house that no longer belongs to her.


While BofA was prompt in identifying the problem after Curtis reported the issue, it's been more than five months and she still hasn't received a letter to confirm that the title issues have been resolved. A bank spokesperson also told her that they'd clear up her credit issues, but that could take up to three months. In the meantime, Curtis' credit score remains in the dumps.

"They said that they had to keep reprocessing it and this has been a game we've been playing ever since," Curtis told KUTV. "They just say they need to reprocess papers."

AOL Real Estate contacted the new owners of the home in question, who said they were unaware of the Curtises' problem, adding that they are current on their own mortgage. They've never received any mail from Bank of America addressed to the Curtises either, they said during a phone interview.

The new owners' mortgage is with a different lender.

When reached for comment, a spokesperson for the Bank of America told us that they will look into the matter. As of this writing, they have yet to respond.

UPDATE: Bank of America spokesperson Jumana Bauwens sent the following --
This was an issue that we handled with the tv station in August. It was a result of a coding error. We have verified that all the codes on the loan were corrected. The loan now has a zero balance and reflects as paid off in the system. We apologize to the Curtis' for this error and have made (in August) the necessary corrections to the credit agencies.

See also:
Woman Faces Foreclosure On Home She Bought for $1
Soldier Buys Back Parents' Foreclosed Home
Houston Family Foreclosed On Through No Fault of Their Own

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]]>1 dollar foreclosurebank error foreclosurebank of americaBank of America error foreclosurebofafamily threatened with foreclosurehome titleshantell curtisuntransfered titleuntransferred titleutahvernalwrongful foreclosureStefanos Chen2011-11-04T14:00:00 00:00Victims of Robo-Signing: Fight the Machine!http://realestate.aol.com/blog/2011/11/02/victims-of-robo-signing-fight-the-machine/http://realestate.aol.com/blog/2011/11/02/victims-of-robo-signing-fight-the-machine/http://realestate.aol.com/blog/2011/11/02/victims-of-robo-signing-fight-the-machine/#comments

With the national foreclosure settlement ramping up, victims of the housing crisis may finally be getting some satisfaction. Starting this week, more than 4 million homeowners who faced foreclosure between 2009 and 2010 may be able to get their cases reviewed to determine whether their lenders engaged in robo-signing and other questionable practices.

The Office of the Comptroller of the Currency has ordered the 14 largest mortgage servicers to send out mailers informing borrowers how to request a review if they suffered "financial injury as a result of errors, misrepresentations, or other deficiencies in foreclosure proceedings" on the purchase of their primary home.

In addition to being spanked for robo-signed signatures (pictured above) and other faulty documentation, banks may also be on the hook for other "financially harmful" practices, such as foreclosing on a home at the same time that the homeowner was in the process of a loan modification.

To qualify, the homeowner's mortgage must have been active in the foreclosure process between Jan. 1, 2009 and Dec. 31, 2010. Requests for reviews must be submitted by April 30, 2012. The loan must have been serviced by one of the lenders listed here. A neutral third party will review the complaints, according to the OCC release.

There is no word yet as to how much individual homeowners may recoup, nor is there any indication that foreclosed homeowners who fall outside the 2009-2010 window will receive a similar deal. And while this may be a step in the right direction for homeowners wronged by their lenders during the housing bubble, it falls far short of getting to the root of the problem. Robo-signing may have been a widespread phenomenon as far back as the mid-1990s, according to The Associated Press.

To learn more about the program and to see if your loan is eligible, visit IndependentForeclosureReview.com.

Also see:
Foreclosure Law Firm Mocks the Homeless for Halloween
Viewpoint: Kamala Harris for President
Houston Family Foreclosed On Through No Fault of Their Own

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]]>foreclosure crisisforeclosure settlementhousing bubblerobosignerrobosigningunderwater mortgagesStefanos Chen2011-11-02T15:11:00 00:00