Freddie Mac’s chief economist is optimistic that the housing market and economy will improve in the second half of 2011.
Freddie Mac Chief Economist Frank Nothaft said mortgage rates will likely remain historical lows of between 4.5 percent and 5 percent for the remainder of the year. Also, he expects more buyers to stop waiting on the sidelines as recent price drops in home prices have improved affordability.
Nothaft said consumers’ uncertainty about the economy has caused them to delay home purchases and other “big-ticket items.”
"Some potential buyers who have the means to buy are awaiting clearer signs that home values have firmed," Nothaft says.
But Nothaft says they should be getting their signs in the second half of the year, with projected job gains, and a growing, improved economy.
"Even though near-term concerns over income and sales growth are restraining consumer spending, business hiring, and new building, a number of positive signs in the economy indicate that growth will continue and is likely to accelerate in the second half of this year," Nothaft said. "Look for a gradual improvement in housing activity in the coming year.”
Source: “Freddie Mac Economist Sees Sunny Economy in Second Half,” HousingWire (June 27, 2011)
Tuesday, June 28, 2011
Tuesday, June 21, 2011
Existing-Home Sales Decline in May with Market Constraints, Temporary Conditions
Article from NAR (National Association of Realtors)
Washington, DC, June 21, 2011
Existing-home sales were down in May as temporary factors and financing problems weighed on the market, according to the National Association of Realtors®.
Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, fell 3.8 percent to a seasonally adjusted annual rate of 4.81 million in May from a downwardly revised 5.00 million in April, and are 15.3 percent below a 5.68 million pace in May 2010 when sales were surging to beat the deadline for the home buyer tax credit.
Lawrence Yun, NAR chief economist, said temporary factors held back the market in May, as implied from prior data on contract signings. “Spiking gasoline prices along with widespread severe weather hurt house shopping in April, leading to soft figures for actual closings in May,” he said. “Current housing market activity indicates a very slow pace of broader economic activity, but recent reversals in oil prices are likely to mitigate the impact going forward. The pace of sales activity in the second half of the year is expected to be stronger than the first half, and will be much stronger than the second half of last year.”
Yun said the market also is being constrained by the lending community. “Even with recent economic softness, this is a disappointing performance with home sales being held back by overly restrictive loan underwriting standards,” he said. “There’s been a pendulum swing from very loose standards which led to the housing boom to unnecessarily restrictive practices as an overreaction to the housing correction – this overreaction is clearly holding back the recovery.”
There were notable regional differences in home sales. “A large decline in Midwestern existing-home sales can be attributed partly to the flooding and other severe weather patterns that occurred, but this also implies a temporary nature of soft market activity,” Yun explained.
The national median existing-home price2 for all housing types was $166,500 in May, down 4.6 percent from May 2010. Distressed homes3 – typically sold at a discount of about 20 percent – accounted for 31 percent of sales in May, down from 37 percent in April; they were 31 percent in May 2010.
“The price decline could be diminishing, as buyers recognize great bargain prices and the highest affordability conditions in 40 years; this will help mitigate further price drops,” Yun said.
“Home prices are rising or very stable in local markets with improved employment conditions, such as in North Dakota, Alaska, Washington, D.C., and many parts of Texas,” Yun noted.
NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said a number of proposals being considered in Washington could further jeopardize the housing recovery. “We’re concerned about the flow of available capital, including a possible rule that would effectively raise minimum downpayment requirements to 20 percent,” he said. “We don’t need to throw the baby out with the bath water – increasing downpayment requirements would effectively shut many qualified families out of the market. What we critically need is a return to the basics of providing safe mortgages to creditworthy buyers willing to stay well within their budget.”
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.64 percent in May, down from 4.84 percent in April; the rate was 4.89 percent in May 2010. “Although low mortgage interest rates are welcome, they are less meaningful compared to the tightness of loan underwriting standards,” Yun noted.
Total housing inventory at the end of May fell 1.0 percent to 3.72 million existing homes available for sale, which represents a 9.3-month supply4 at the current sales pace, up from a 9.0-month supply in April.
All-cash transactions stood at 30 percent in May, down from 31 percent in April; they were 25 percent in May 2010; investors account for the bulk of cash purchases.
First-time buyers purchased 35 percent of homes in May, down from 36 percent in April; they were 46 percent in May 2010 when the tax credit was in place. Investors accounted for 19 percent of purchase activity in May compared with 20 percent in April; they were 14 percent in May 2010.
Single-family home sales declined 3.2 percent to a seasonally adjusted annual rate of 4.24 million in May from 4.38 million in April, and are 15.4 percent below a surge to 5.01 million one year ago. The median existing single-family home price was $166,700 in May, down 4.5 percent from May 2010.
Existing condominium and co-op sales fell 8.1 percent to a seasonally adjusted annual rate of 570,000 in May from 620,000 in April, and are 14.7 percent below the 668,000-unit pace in May 2010. The median existing condo price5 was $165,400 in May, which is 5.8 percent below a year ago.
Regionally, existing-home sales in the Northeast declined 2.5 percent to an annual level of 770,000 in May and are 13.5 percent below May 2010. The median price in the Northeast was $241,500, up 6.1 percent from a year ago.
Existing-home sales in the Midwest dropped 6.4 percent in May to a pace of 1.02 million and are 22.7 percent below a year ago. The median price in the Midwest was $136,400, which is 8.5 percent below May 2010.
In the South, existing-home sales fell 5.1 percent to an annual level of 1.85 million in May and are 14.4 percent below May 2010. The median price in the South was $149,200, down 3.1 percent from a year ago.
Existing-home sales in the West were unchanged at an annual pace of 1.17 million in May but are 10.0 percent lower than a year ago. The median price in the West was $192,300, which is 12.6 percent below May 2010.
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
# # #
NOTE: NAR also tracks monthly comparisons of existing single-family home sales and median prices for select metropolitan statistical areas, which is posted with other tables at: www.realtor.org/research/research/ehsdata. For information on areas not included in the report, please contact the local association of Realtors®.
1Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings. This differs from the U.S. Census Bureau’s series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which generally account for 85 to 90 percent of total home sales, are based on a much larger sample – more than 40 percent of multiple listing service data each month – and typically are not subject to large prior-month revisions.
The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.
Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.
Benchmark Revisions: All major statistical data series go through periodic reviews and revisions to ensure that sampling and methodology keep up with changes in the market, such as population changes in sampled areas, to ensure accuracy. NAR began its normal process for benchmarking sales earlier this year; there will be no change to median prices. In the past we’ve benchmarked to the decennial Census, most recently to the 2000 Census, because it included home sales data. However, the data are no longer included in the Census, so we’re looking at more frequent benchmarking using a new approach with independent sources to improve our process and modeling. As always, we are consulting with various outside housing economists, government agencies and academic experts for a consensus on the methodology; NAR is committed to providing accurate, reliable data. Publication of the revisions is expected this summer; we will notify a month in advance of the publication date.
2The only valid comparisons for median prices are with the same period a year earlier due to the seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if more data is received than was originally reported.
3Distressed sales, first-time buyers, investors, contract cancellations and all-cash transactions are from a survey for the Realtors® Confidence Index, posted at Realtor.org.
4Total inventory and month’s supply data are available back through 1999, while single-family inventory and month's supply are available back to 1982 (prior to 1999, condos were measured quarterly while single-family sales accounted for more than 90 percent of transactions).
5Because there is a concentration of condos in high-cost metro areas, the national median condo price often is higher than the median single-family price. In a given market area, condos typically cost less than single-family homes.
The Pending Home Sales Index for May will be released June 29, and existing-home sales for June is scheduled for July 20; release times are 10:00 a.m. EDT.
Information about NAR is available at www.realtor.org. This and other news releases are posted in the News Media section. Statistical data in this release, other tables and surveys also may be found by clicking on Research.
REALTOR® is a registered collective membership mark which may be used only by real estate professionals who are members of the NATIONAL ASSOCIATION OF REALTORS® and subscribe to its strict Code of Ethics. Not all real estate agents are REALTORS®. All REALTORS® are members of NAR.
Washington, DC, June 21, 2011
Existing-home sales were down in May as temporary factors and financing problems weighed on the market, according to the National Association of Realtors®.
Existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, fell 3.8 percent to a seasonally adjusted annual rate of 4.81 million in May from a downwardly revised 5.00 million in April, and are 15.3 percent below a 5.68 million pace in May 2010 when sales were surging to beat the deadline for the home buyer tax credit.
Lawrence Yun, NAR chief economist, said temporary factors held back the market in May, as implied from prior data on contract signings. “Spiking gasoline prices along with widespread severe weather hurt house shopping in April, leading to soft figures for actual closings in May,” he said. “Current housing market activity indicates a very slow pace of broader economic activity, but recent reversals in oil prices are likely to mitigate the impact going forward. The pace of sales activity in the second half of the year is expected to be stronger than the first half, and will be much stronger than the second half of last year.”
Yun said the market also is being constrained by the lending community. “Even with recent economic softness, this is a disappointing performance with home sales being held back by overly restrictive loan underwriting standards,” he said. “There’s been a pendulum swing from very loose standards which led to the housing boom to unnecessarily restrictive practices as an overreaction to the housing correction – this overreaction is clearly holding back the recovery.”
There were notable regional differences in home sales. “A large decline in Midwestern existing-home sales can be attributed partly to the flooding and other severe weather patterns that occurred, but this also implies a temporary nature of soft market activity,” Yun explained.
The national median existing-home price2 for all housing types was $166,500 in May, down 4.6 percent from May 2010. Distressed homes3 – typically sold at a discount of about 20 percent – accounted for 31 percent of sales in May, down from 37 percent in April; they were 31 percent in May 2010.
“The price decline could be diminishing, as buyers recognize great bargain prices and the highest affordability conditions in 40 years; this will help mitigate further price drops,” Yun said.
“Home prices are rising or very stable in local markets with improved employment conditions, such as in North Dakota, Alaska, Washington, D.C., and many parts of Texas,” Yun noted.
NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I., said a number of proposals being considered in Washington could further jeopardize the housing recovery. “We’re concerned about the flow of available capital, including a possible rule that would effectively raise minimum downpayment requirements to 20 percent,” he said. “We don’t need to throw the baby out with the bath water – increasing downpayment requirements would effectively shut many qualified families out of the market. What we critically need is a return to the basics of providing safe mortgages to creditworthy buyers willing to stay well within their budget.”
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 4.64 percent in May, down from 4.84 percent in April; the rate was 4.89 percent in May 2010. “Although low mortgage interest rates are welcome, they are less meaningful compared to the tightness of loan underwriting standards,” Yun noted.
Total housing inventory at the end of May fell 1.0 percent to 3.72 million existing homes available for sale, which represents a 9.3-month supply4 at the current sales pace, up from a 9.0-month supply in April.
All-cash transactions stood at 30 percent in May, down from 31 percent in April; they were 25 percent in May 2010; investors account for the bulk of cash purchases.
First-time buyers purchased 35 percent of homes in May, down from 36 percent in April; they were 46 percent in May 2010 when the tax credit was in place. Investors accounted for 19 percent of purchase activity in May compared with 20 percent in April; they were 14 percent in May 2010.
Single-family home sales declined 3.2 percent to a seasonally adjusted annual rate of 4.24 million in May from 4.38 million in April, and are 15.4 percent below a surge to 5.01 million one year ago. The median existing single-family home price was $166,700 in May, down 4.5 percent from May 2010.
Existing condominium and co-op sales fell 8.1 percent to a seasonally adjusted annual rate of 570,000 in May from 620,000 in April, and are 14.7 percent below the 668,000-unit pace in May 2010. The median existing condo price5 was $165,400 in May, which is 5.8 percent below a year ago.
Regionally, existing-home sales in the Northeast declined 2.5 percent to an annual level of 770,000 in May and are 13.5 percent below May 2010. The median price in the Northeast was $241,500, up 6.1 percent from a year ago.
Existing-home sales in the Midwest dropped 6.4 percent in May to a pace of 1.02 million and are 22.7 percent below a year ago. The median price in the Midwest was $136,400, which is 8.5 percent below May 2010.
In the South, existing-home sales fell 5.1 percent to an annual level of 1.85 million in May and are 14.4 percent below May 2010. The median price in the South was $149,200, down 3.1 percent from a year ago.
Existing-home sales in the West were unchanged at an annual pace of 1.17 million in May but are 10.0 percent lower than a year ago. The median price in the West was $192,300, which is 12.6 percent below May 2010.
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.1 million members involved in all aspects of the residential and commercial real estate industries.
# # #
NOTE: NAR also tracks monthly comparisons of existing single-family home sales and median prices for select metropolitan statistical areas, which is posted with other tables at: www.realtor.org/research/research/ehsdata. For information on areas not included in the report, please contact the local association of Realtors®.
1Existing-home sales, which include single-family, townhomes, condominiums and co-ops, are based on transaction closings. This differs from the U.S. Census Bureau’s series on new single-family home sales, which are based on contracts or the acceptance of a deposit. Because of these differences, it is not uncommon for each series to move in different directions in the same month. In addition, existing-home sales, which generally account for 85 to 90 percent of total home sales, are based on a much larger sample – more than 40 percent of multiple listing service data each month – and typically are not subject to large prior-month revisions.
The annual rate for a particular month represents what the total number of actual sales for a year would be if the relative pace for that month were maintained for 12 consecutive months. Seasonally adjusted annual rates are used in reporting monthly data to factor out seasonal variations in resale activity. For example, home sales volume is normally higher in the summer than in the winter, primarily because of differences in the weather and family buying patterns. However, seasonal factors cannot compensate for abnormal weather patterns.
Single-family data collection began monthly in 1968, while condo data collection began quarterly in 1981; the series were combined in 1999 when monthly collection of condo data began. Prior to this period, single-family homes accounted for more than nine out of 10 purchases. Historic comparisons for total home sales prior to 1999 are based on monthly single-family sales, combined with the corresponding quarterly sales rate for condos.
Benchmark Revisions: All major statistical data series go through periodic reviews and revisions to ensure that sampling and methodology keep up with changes in the market, such as population changes in sampled areas, to ensure accuracy. NAR began its normal process for benchmarking sales earlier this year; there will be no change to median prices. In the past we’ve benchmarked to the decennial Census, most recently to the 2000 Census, because it included home sales data. However, the data are no longer included in the Census, so we’re looking at more frequent benchmarking using a new approach with independent sources to improve our process and modeling. As always, we are consulting with various outside housing economists, government agencies and academic experts for a consensus on the methodology; NAR is committed to providing accurate, reliable data. Publication of the revisions is expected this summer; we will notify a month in advance of the publication date.
2The only valid comparisons for median prices are with the same period a year earlier due to the seasonality in buying patterns. Month-to-month comparisons do not compensate for seasonal changes, especially for the timing of family buying patterns. Changes in the composition of sales can distort median price data. Year-ago median and mean prices sometimes are revised in an automated process if more data is received than was originally reported.
3Distressed sales, first-time buyers, investors, contract cancellations and all-cash transactions are from a survey for the Realtors® Confidence Index, posted at Realtor.org.
4Total inventory and month’s supply data are available back through 1999, while single-family inventory and month's supply are available back to 1982 (prior to 1999, condos were measured quarterly while single-family sales accounted for more than 90 percent of transactions).
5Because there is a concentration of condos in high-cost metro areas, the national median condo price often is higher than the median single-family price. In a given market area, condos typically cost less than single-family homes.
The Pending Home Sales Index for May will be released June 29, and existing-home sales for June is scheduled for July 20; release times are 10:00 a.m. EDT.
Information about NAR is available at www.realtor.org. This and other news releases are posted in the News Media section. Statistical data in this release, other tables and surveys also may be found by clicking on Research.
REALTOR® is a registered collective membership mark which may be used only by real estate professionals who are members of the NATIONAL ASSOCIATION OF REALTORS® and subscribe to its strict Code of Ethics. Not all real estate agents are REALTORS®. All REALTORS® are members of NAR.
Thursday, June 16, 2011
Investors Moving Foreclosures Faster Than Banks Along West Coast
From: DSNews.com
Written by: Carrie Bay
Third-party investors are reselling foreclosure properties they’ve scooped up at auction at a rapid pace in states along the country’s Western seaboard. In fact, they’re moving distressed homes faster than lenders, according to a local tracking firm.
ForeclosureRadar, based out of Discovery Bay, California, keeps tabs on every foreclosure and provides daily auction updates for its coverage area, which encompasses Arizona, California, Nevada, Oregon, and Washington.
The company says the one consistent market statistic in all five states during the month of May was a drop in how long it’s taking foreclosure auction investors to offload properties.
“While we believe this is partially due to finally seeing some spring selling activity, we think it has more to do with an overall lack of quality, affordable homes for sale,” said Sean O’Toole, CEO of ForeclosureRadar.
Based on the firm’s market data, the average number of days between an investor’s purchase of the property at foreclosure auction in Arizona, and when the property was resold, was 95 days in May. That’s a drop of more than 10 percent from the month before, and contrasts with the average resell timeline of 150 days for banks.
In California, investors are offloading foreclosed homes in 134 days on average, versus 227 for banks.
In the foreclosure hotbed of Nevada, it’s taking investors an average of 102 days to resell homes, while banks are holding onto a property for 177 days before it sells.
In Oregon, time-to-resell is 122 days for foreclosure investors, compared to 208 days for banks.
Washington saw a similar divergence, though its investor timeline was the longest of all five states. There, investors are able to turn around and sell foreclosure properties in 164 days on average, versus 212 days for banks.
Looking at ForeclosureRadar’s historical data, the resell timelines for investors and banks were separated by fewer than 8 days as recently as February in Washington and Oregon, and fewer than 20 days in Nevada as recently as January.
According to O’Toole, investors have become better at turning a foreclosure into a marketable property that attracts buyer interest. He also points to the fact that delays in the foreclosure process from recent robo-signing reviews and moratoriums have left fewer affordable homes available for sale.
“Foreclosure investors may be the only winner so far,” O’Toole said, “benefitting by being able to resell homes purchased at foreclosure auction a little more quickly.”
Overall foreclosure filing activity along the West Coast was down in May, according to ForeclosureRadar.
The company tracked fewer filings in all states except California, where there was an increase in notices of trustee sale and likely signals more foreclosure sales in the state in the months ahead.
Activity on the courthouse steps was mixed, with California the only state to have increases in foreclosure sales both back to the bank and sold to third-party investors.
After recording a jump in foreclosure cancellations across the board in April, ForeclosureRadar says there was a reversal of this trend in May. Cancellations dropped significantly last month in California, Nevada, and Washington. They declined moderately declined in Arizona, and increased in Oregon.
Time-to-foreclose set a record in California last month, taking an average of 344 days. However the length of the foreclosure process declined in Nevada, Oregon, and Washington, and was up just two days in Arizona.
Written by: Carrie Bay
Third-party investors are reselling foreclosure properties they’ve scooped up at auction at a rapid pace in states along the country’s Western seaboard. In fact, they’re moving distressed homes faster than lenders, according to a local tracking firm.
ForeclosureRadar, based out of Discovery Bay, California, keeps tabs on every foreclosure and provides daily auction updates for its coverage area, which encompasses Arizona, California, Nevada, Oregon, and Washington.
The company says the one consistent market statistic in all five states during the month of May was a drop in how long it’s taking foreclosure auction investors to offload properties.
“While we believe this is partially due to finally seeing some spring selling activity, we think it has more to do with an overall lack of quality, affordable homes for sale,” said Sean O’Toole, CEO of ForeclosureRadar.
Based on the firm’s market data, the average number of days between an investor’s purchase of the property at foreclosure auction in Arizona, and when the property was resold, was 95 days in May. That’s a drop of more than 10 percent from the month before, and contrasts with the average resell timeline of 150 days for banks.
In California, investors are offloading foreclosed homes in 134 days on average, versus 227 for banks.
In the foreclosure hotbed of Nevada, it’s taking investors an average of 102 days to resell homes, while banks are holding onto a property for 177 days before it sells.
In Oregon, time-to-resell is 122 days for foreclosure investors, compared to 208 days for banks.
Washington saw a similar divergence, though its investor timeline was the longest of all five states. There, investors are able to turn around and sell foreclosure properties in 164 days on average, versus 212 days for banks.
Looking at ForeclosureRadar’s historical data, the resell timelines for investors and banks were separated by fewer than 8 days as recently as February in Washington and Oregon, and fewer than 20 days in Nevada as recently as January.
According to O’Toole, investors have become better at turning a foreclosure into a marketable property that attracts buyer interest. He also points to the fact that delays in the foreclosure process from recent robo-signing reviews and moratoriums have left fewer affordable homes available for sale.
“Foreclosure investors may be the only winner so far,” O’Toole said, “benefitting by being able to resell homes purchased at foreclosure auction a little more quickly.”
Overall foreclosure filing activity along the West Coast was down in May, according to ForeclosureRadar.
The company tracked fewer filings in all states except California, where there was an increase in notices of trustee sale and likely signals more foreclosure sales in the state in the months ahead.
Activity on the courthouse steps was mixed, with California the only state to have increases in foreclosure sales both back to the bank and sold to third-party investors.
After recording a jump in foreclosure cancellations across the board in April, ForeclosureRadar says there was a reversal of this trend in May. Cancellations dropped significantly last month in California, Nevada, and Washington. They declined moderately declined in Arizona, and increased in Oregon.
Time-to-foreclose set a record in California last month, taking an average of 344 days. However the length of the foreclosure process declined in Nevada, Oregon, and Washington, and was up just two days in Arizona.
Monday, June 13, 2011
Short Sales and TALL Lies!
One of the biggest problems we run into, as Realtors, is other Realtors listing homes at ridiculously low prices with the appearance that someone can actually purchase the home at an extremely LOW price. This creates many problems that hurt the market:
1. Price expectations in neighborhoods are lowered causing lower offers and drives the market down even further.
2. Buyers are afraid to buy homes listed at value because of 1 short sale home in the area that is advertising an unrealistic low price.
3. Buyers have the impression that they can buy a home for a price advertised on the MLS. Many buyers don't realize that the price listed on a short sale is a "pie in the sky" hope that maybe the bank will accept the offer. In reality, when an offer is placed on a short sale, the bank may take several months to respond to the offer. Once the bank responds, many times the banks demand a higher price. For example, an agent lists a home in a neighborhood for $200,000 (even though similar homes are selling for $300,000). A buyer makes an offer of $200,000 and waits 6 months for the bank to respond to the offer. The bank comes back with a counter offer of $300,000. The buyer has wasted 6 months waiting for a response and then the bank responds with a price more in line with the market. The disappointed buyer can start the process all over on another short sale home or chose to buy a home that is not a short sale with a "real" price.
3. Listing Agents are so tired of spending months trying to sell a short sale home and then the deal falls through because the buyer is tired of waiting for a response from the bank. Many listing agents are now requiring a non-refundable earnest money to be deposited for 90 days in case the buyer chooses to buy a different home than the home they put an offer on. This ties up the buyer so if a really good deal (not a short sale) comes on the market, they cannot put an offer on it without losing their earnest money.
To be honest, I think the best way to make an offer on a home is by putting an offer on a home with a real price! Buy a new home or a resale home or a foreclosed home that you know the price is realistic. Don't waste your time playing games with the banks that they might actually be reasonable (well... what you think is reasonable). Banks are in business to make money- not help you get a screaming deal on a home. Go with something real and enjoy the home buying process!
Matt Carter did a great job explaining in his article below about some of the false appearances some real estate agents give in selling real estate.
Washington short-sale brokers could lose licenses
Real estate team accused of false advertising, underpricing listings
Matt Carter
Inman News™
A prominent short-sale broker and his wife could be barred from practicing real estate for 10 years, after an administrative law judge affirmed six of 10 alleged license violations filed against them by the state of Washington's Department of Licensing.
Washington regulators suspended the licenses of designated broker Michael Hellickson, his wife Tara Hellickson, also a broker, and their Pierce County-based brokerage, Hellickson.com Inc., without a hearing in September after receiving more than two dozen complaints about their practices.
A superior court judge reinstated all three licenses in October, pending the outcome of a hearing by an administrative law judge.
After a 10-day hearing in February and March in which the Department of Licensing called more than two dozen witnesses, Administrative Law Judge Terry A. Schuh affirmed six of the 10 alleged violations filed against the Hellicksons, and half of the 10 alleged violations lodged against their firm.
An attorney for the Hellicksons has filed a petition for review of Schuh's May 11 initial order. The Hellicksons' licenses remain in force while Schuh considers the issues raised in the petition and the Department of Licensing's response.
If the Hellicksons' petition is unsuccessful, the Department of Licensing will have 90 days from the May 11 initial order to revoke their licenses.
Michael and Tara Hellickson would then have the option of going back to Superior Court to challenge their license suspensions.
Schuh found that the Hellicksons and their firm engaged in a "pattern and practice" of listing homes at artificially reduced prices that didn't accurately reflect what the owner was willing to accept, in the hopes of generating multiple offers.
The Hellicksons misrepresented that they would buy homes listed with them that did not sell within 30 days, and that Michael Hellickson engaged in false advertising when he claimed to be the No. 1 agent in Washington, Oregon and Hawaii, Schuh ruled.
The Hellickson Team also "engaged in a pattern and practice of negligent and dilatory communications with homeowners, potential buyers, and lenders" by not responding to phone calls and e-mails in a timely fashion, resulting in unreasonable risk of harm to their clients, according to the ruling.
The administrative law judge also affirmed findings that Michael and Tara Hellickson drafted addendums to purchase and sale agreements requiring that buyers prequalify with one of two or three specific lenders, even though their clients had not requested or authorized such a requirement. Although the agreements were signed or initialed by sellers, Schuh found that such authorization was "uninformed," because the addendums were not requested by homeowners or discussed with them.
On the other hand, Schuh found that the Department of Licensing had not proved allegations that the Hellicksons encouraged homeowners to stop making their mortgage payments, or told them they were required to vacate their homes before they were legally required to do so.
The Department of Licensing also failed to prove allegations that the Hellicksons instituted automatic price reductions without authorization by the sellers, Schuh said in a May 11 initial order, setting those findings aside.
Although Schuh ruled that the Hellicksons had, in fact, failed to provide copies of executed listing agreements to homeowners as alleged, he set aside charges that the couple engaged in a "pattern and practice" of misrepresenting the contents of listing agreements, such as their term.
Hellickson, who's also known for the short-sale and REO (bank-owned property) coaching seminars he offers nationwide through another company, Club Wealth Inc., said he expects to prevail in his two-year battle with the Department of Licensing.
His refusal to turn over records sought by the Department of Licensing, he said, "stirred up the hornet's nest," and department staff seemed determined "to dig up anything I'd done wrong."
Clients, agents testify at hearings
To make its case against the Hellicksons, the Department of Licensing filed 296 exhibits and called 27 witnesses to testify, including former Hellickson Team employees and nearly a dozen past clients. Also testifying were several real estate agents who represented prospective buyers, and a Wells Fargo liquidation manager.
When the department brought charges against the Hellicksons and suspended their licenses in September, they had 400-500 listings, more than 200 of which were pending, Michael Hellickson testified.
In 2009 and 2010, about half the listings represented by the Hellicksons -- who conducted their business as "The Hellickson Team" -- were short sales, and the other half REOs.
The department received 37 complaints about the Hellicksons -- about 10 of which were filed after the department filed charges. The complaints referenced either Michael Hellickson or his team, but the Department of Licensing said it also sought to revoke Tara Hellickson's license because she was the co-listing agent on all of the listing agreements.
The department stopped communicating with the Hellicksons after receiving a Dec. 2, 2009, letter from their attorney, Douglas Tingvall, informing the department that the couple would no longer provide information or documents to the department because such requests allegedly violated their Fourth Amendment protections against unlawful search and seizure.
In his petition for review of Schuh's initial order, Tingvall said Michael Hellickson is "an innovator and a leader" in the short-sale business, and that innovators "become targets for competitors and regulators, who often do not understand or lag behind a rapidly changing environment." In the past, license revocations of five years or more have been the result of "criminal acts, serious moral turpitude, fraud, theft or other intentional mishandling of client funds," he said. The Hellicksons "were not found to have done any of these things."
A "disinterested observer" could conclude that regulators went on a "witch hunt" only to retaliate for the Hellicksons' refusal to provide records without a warrant or determination of probable cause, Tingvall argued.
The Department of Licensing, meanwhile, maintained that a 10-year license suspension, although "severe" and "rare," was justified because the Hellicksons allegedly committed a large number of violations, many violations were repeated, and they did not cooperate with the investigation or acknowledge or attempt to correct their conduct. Listing homes at artificially low prices was a serious enough violation that it, alone, might have resulted in a 10-year revocation, the administrator of the department's real estate unit, Jerry McDonald, testified.
30-day sale program
The Hellicksons' radio advertisements, for-sale signs, and website promised that they would purchase their clients' homes or sell them at no commission if they did not sell within 30 days. Although the ads noted that some restrictions applied, no ad said the 30-day program did not apply to short sales, Schuh found.
Schuh found that the purpose of the ads was to generate leads and listing agreements. The Hellickson Team, he determined, "had no intention of buying homes at anything close to market price."
Two agents employed by the Hellickson Team, Joe Toner and Jon Ryan Geersten, testified that they used a script when scheduling listing appointments that mentioned the 30-day offer. Geersten testified that when he expressed reservations about the offer, Michael Hellickson told him that the offer was contingent on the seller accepting a sale price that was 50 percent of market value.
Hellickson testified that the 30-day offer could not apply to short sales, because lenders would not accept such a low offer. He also testified that he had not purchased any homes under the 30-day sale program since 2008.
In his petition for review, Tingvall argued that there was "nothing false, deceptive or misleading" about the Hellicksons' 30-day sale program. The Department of Licensing offered no evidence that any consumers relied on it, Tingvall said, or that the Hellicksons refused to purchase any eligible homes.
The Hellicksons were under no legal obligation to post the restrictions that applied to the program on their website or in their newsletter, their lawyer maintained. "Obviously, (the Hellicksons) hoped that prospective clients would call them to ask about their services," the Hellicksons' lawyer argued in the petition for review. "The purpose of any advertising by a real estate broker is to generate calls and personal appointments."
False advertising
Tingvall noted that the Department of Licensing offered no evidence to refute Michael Hellickson's claim that no other agent did more business in Washington, Oregon or Hawaii in 2009 or 2010, or that he was not the leading expert on short sales in those states.
But Schuh found that the Hellickson was never licensed in Oregon or Hawaii, and would simply refer business in those states to someone who was. The Hellickson Team also advertised a loan company that "was not functional," and Michael Hellickson's license to originate loans and the license of the mortgage firm it was associated with had both expired.
Listing prices
Schuh said it was undisputed that the Hellicksons obtained authorization from their clients to make "substantial, arbitrary price reductions, usually every two weeks, simply because the home had not generated offers." The price reductions were "aggressive and frequent," and "apparently the prices were below what the lender would accept," Schuh wrote. "The implication is that (the defendants) were more interested in generating offers than they were in realistic pricing."
In November 2008, for example, The Hellickson Team listed the home of Dan and Kathleen Streight for $275,000. The asking price was then reduced at two-week intervals in increments of $25,000, to $175,000 by the week before Christmas.
"When Dan Streight learned from a real estate agent that the price on his home had dropped to $175,000, he and his wife were shocked because the lien holder had told Mr. Streight that (the lender) would not accept less than $240,000," Schuh wrote, citing Streight's testimony at the hearing.
Schuh found that the Hellicksons "engaged in a pattern and practice of listing homes at artificially reduced prices" in order to generate "multiple lowball offers." But he also determined that the preponderance of the evidence showed that the Hellicksons were authorized to do so by sellers through signed, preauthorized, price-reduction forms.
The Streights testified that they had verbally agreed to a series of $20,000 price reductions every two weeks. Although they did not discuss a bottom price, the Streights said they understood they would be notified in advance of any price reduction. They also claimed a price-reduction authorization form they signed was blank. The form, introduced as evidence at the hearing, called for price reductions of $25,000 every two weeks.
Michael Hellickson testified that the price-reduction authorizations he provided to short-sale clients were always completed at listing appointments. The Streights did not ask him to provide advance notice of price reductions, he testified, and he had not offered to do so. Schuh said he found Hellickson's testimony credible.
In another instance, the asking price on a condo the Hellicksons listed at $175,000 in September 2008 was reduced several times in two months, to $75,000, before bouncing back to $117,000 by the following February. The owner, Richard Smith, testified that he had agreed to lesser price reductions, that the form he signed authorizing price reductions was blank, and that his calls to the Hellickson Team office about price reductions were not returned.
Toner, the former Hellickson Team agent, testified that he was instructed to convince sellers to sign price-reduction forms with reductions of at least $25,000 every two weeks, but said he was never told to have clients sign blank price-reduction forms. Toner testified that when he started working with the Hellicksons in August 2009, listing prices were determined using comparative market analyses (CMAs) produced by Tara Hellickson.
But after a few months, Toner testified at the hearing, he was told to list homes for the amount owed to the lender. He said he continued to prepare his own CMAs to fulfill his responsibilities to the seller. Toner said no additional market research was done before preapproved price reductions were applied.
Michael Hellickson testified that he took a comparative market analysis (CMA) with him to each listing appointment, but that it was not his practice to perform a CMA before every price reduction.
An expert witness for the Department of Licensing, real estate agent Allison Ybarra, said preapproved price-reduction agreements are not, in themselves, violations of state licensing law.
The Hellicksons' pricing practices generated a number of complaints to their multiple listing service, Northwest Multiple Listing Service (NWMLS), most alleging that the asking price of a listing was not a good faith reflection of what the seller would accept, or that the lender would approve.
Justin Haag, NWMLS' director of policy and forms, testified that the MLS did not add the term "good faith" to rules governing the pricing of listings until the summer of 2009.
Haag testified that NWMLS had received 40 complaints about the Hellickson Team since 2004, most of them regarding pricing. A total of 18 complaints resulted in disciplinary action by the MLS against the Hellickson Team in 2009 and 2010 -- or about 3 percent of the Hellickson Team's sales in those years.
In his petition for review of Schuh's initial order, Tingvall said nothing in real estate licensing law prohibits preapproval for price reductions, and the department "has no business interfering with private contracts between brokers and competent adults." He also argued, "Short sales are different than typical retail sales … The department is out of touch with current trends and practices. Doing things differently is not the same as doing things negligently," he argued.
Listing agreements
The Hellickson Team office "was disorganized and inefficient," Schuh said in explaining how he was "persuaded that it repeatedly failed to provide clients with copies of the executed listing agreement" -- a breach of reasonable skill and care.
In his petition for review, Tingvall said evidence presented by the Department of Licensing on whether the Hellicksons failed to provide copies of listing agreements to sellers was "equivocal and unpersuasive."
And Schuh was not convinced that the Hellickson Team engaged in a pattern and practice of misrepresenting the terms of the listing agreement to clients, as alleged by the Department of Licensing.
One couple who had originally wanted a three- to six-month listing agreement, William and Kathleen Cody, said they were later surprised when a buyer's agent informed them that the listing agreement they signed in March 2009 would not expire until Dec. 31, 2013. William Cody said he did not read the listing agreement before signing it, but that parts were left blank -- a claim also made by other clients.
Michael Hellickson testified that any handwritten additions to listing agreements were added at the time of the listing appointment, and that nothing was added later. Hellickson said his listing agreements were typically for three to four years, to give him enough time to complete a short sale. Hellickson testified that he didn't want to make an investment in marketing a house only to have the seller relist with another agent.
In an audio recording advertising Hellickson's coaching seminars, which was introduced as evidence at the hearing, Hellickson said his listing appointments typically lasted 32 to 37 minutes, and that by the end of each appointment he had obtained a signed listing agreement, preapproved price-reduction form, and disclosure and other documents.
In the recording, Hellickson said he was able to obtain 50 to 75 listings a month, exercising "dominance" over clients using an approach he compared to "a trainer whacking a dog as hard as possible." Hellickson said he would bring four pens to listing appointments, because that would save eight minutes.
Michael Hellickson's former personal assistant, Theresa Jenkins, testified at the hearing that listing agreements and price-reduction authorizations were not always completed at appointments. Jenkins said she regularly saw signed listing agreements with blanks that had not been filled in.
There were several agents working for the Hellickson Team, she said, and she did not know which agents were not having clients complete documents at listing appointments.
Schuh found that while it was the Hellickson Team's "best practice" to complete listing agreements before obtaining clients' signatures, "compliance with this practice was not 100 percent."
Explanations of what was in the listing agreements was "likely sparse because Michael Hellickson had neither the time nor the inclination to volunteer to do so," Schuh wrote. "However, the sellers must take some responsibility to review a document for blanks before signing and to ask to be shown where provisions of particular concern to them were addressed."
Communication with clients
Schuh also found that the Hellickson Team's poor communications with clients, potential buyers, and lenders placed their clients "at unreasonable risk of harm or prejudice."
Toner testified that the Hellickson Team office was disorganized and hectic, causing delays in response to purchase offers and complaints from clients that office staff members were rude and nonresponsive.
Jenkins testified that files would go missing and that documents were not properly maintained, labeled and stored.
Joyce Watts, a real estate agent formerly employed by the Hellicksons, testified that she was under the impression that the Hellickson Team's office was understaffed and overwhelmed by the volume of business it did.
Monika Peltz, a Wells Fargo liquidations manager who was involved in the attempted short sale of the Streight's home, testified that the lender did not get offers on the home until they were nearly two months old, and never received all of the documents it needed.
Kathleen Streight testified that she was told by other Realtors that there were five or six offers on her home, but that buyer's agents could not get any information from the Hellickson Team on the status of their offers. Streight said that at one point, she left 10 voice mail messages with the Hellickson Team but did not receive a callback. Condo owner Richard Smith, too, testified that communication was spotty and his frequent calls were not returned.
Washington's real estate licensing law requires that real estate brokers "present all written offers, written notices and other written communications" between parties "in a timely manner."
But Tingvall noted that the Hellicksons were not accused of violating that provision of the licensing law. Instead, the Hellicksons were accused of violating more general statutes that address incompetence and negligence over their alleged failure to return phone calls in a timely fashion.
Returning phone calls might be a courtesy to the client, as Ybarra testified, "but it is not a legal requirement of real estate licensing law," Tingvall argued.
Wells Fargo could have lost or misplaced the short-sale packet they were originally sent, Tingvall said in his petition for review. The Streights, he said, ultimately elected to pursue a loan modification and "were not harmed by any alleged delay in presenting offers" to the bank, he said.
For short-sale specialists, communications with sellers and banks are among the biggest challenges, Tingvall said, as banks are backlogged with files and may take months to respond to an offer, and homeowners may themselves be unresponsive.
Preferred lenders
Schuh also affirmed the Department of Licensing's findings that without being asked to do so or authorized by their clients, the Hellicksons, through addendums to purchase and sale agreements, required that buyers prequalify with one of two or three specific lenders.
Michael Hellickson testified that the purpose of the requirement was to get a quick determination from a reliable lender that the buyer would qualify for a loan, before investing resources in a transaction that would only fall through. Hellickson said his brokerage did not receive any compensation for referring buyers to certain lenders for prequalification. Hellickson said the prequalification of buyers by preferred lenders was explained at listing appointments. But several clients said they had not discussed the requirement with Hellickson and did not read prequalification addendums they signed or initialed.
Failing to discuss any addendum with the client -- or representing that a requirement has been requested by the seller, when it has not -- is a violation of "reasonable skill and care" provisions of state licensing law, Ybarra and another real estate agent, Rebecca Beaty, testified.
But the federal Real Estate Settlement Procedures Act (RESPA) doesn't bar sellers or brokers from asking borrowers to prequalify with a preferred lender, Tingvall noted, as long as buyers aren't required to obtain loans from those lenders, and pay no fee for prequalification. Sellers or brokers can even require such prequalification by lenders that they have an affiliated business arrangement with, Tingvall said.
The Hellicksons would simply recommend that sellers request buyers to prequalify with one of the Hellicksons' preferred lenders, "a perfectly lawful and prudent request," Tingvall said.
In the Hellicksons' view, Tingvall said, prequalification by a known lender was "was more reliable and provided better security for their sellers."
1. Price expectations in neighborhoods are lowered causing lower offers and drives the market down even further.
2. Buyers are afraid to buy homes listed at value because of 1 short sale home in the area that is advertising an unrealistic low price.
3. Buyers have the impression that they can buy a home for a price advertised on the MLS. Many buyers don't realize that the price listed on a short sale is a "pie in the sky" hope that maybe the bank will accept the offer. In reality, when an offer is placed on a short sale, the bank may take several months to respond to the offer. Once the bank responds, many times the banks demand a higher price. For example, an agent lists a home in a neighborhood for $200,000 (even though similar homes are selling for $300,000). A buyer makes an offer of $200,000 and waits 6 months for the bank to respond to the offer. The bank comes back with a counter offer of $300,000. The buyer has wasted 6 months waiting for a response and then the bank responds with a price more in line with the market. The disappointed buyer can start the process all over on another short sale home or chose to buy a home that is not a short sale with a "real" price.
3. Listing Agents are so tired of spending months trying to sell a short sale home and then the deal falls through because the buyer is tired of waiting for a response from the bank. Many listing agents are now requiring a non-refundable earnest money to be deposited for 90 days in case the buyer chooses to buy a different home than the home they put an offer on. This ties up the buyer so if a really good deal (not a short sale) comes on the market, they cannot put an offer on it without losing their earnest money.
To be honest, I think the best way to make an offer on a home is by putting an offer on a home with a real price! Buy a new home or a resale home or a foreclosed home that you know the price is realistic. Don't waste your time playing games with the banks that they might actually be reasonable (well... what you think is reasonable). Banks are in business to make money- not help you get a screaming deal on a home. Go with something real and enjoy the home buying process!
Matt Carter did a great job explaining in his article below about some of the false appearances some real estate agents give in selling real estate.
Washington short-sale brokers could lose licenses
Real estate team accused of false advertising, underpricing listings
Matt Carter
Inman News™
A prominent short-sale broker and his wife could be barred from practicing real estate for 10 years, after an administrative law judge affirmed six of 10 alleged license violations filed against them by the state of Washington's Department of Licensing.
Washington regulators suspended the licenses of designated broker Michael Hellickson, his wife Tara Hellickson, also a broker, and their Pierce County-based brokerage, Hellickson.com Inc., without a hearing in September after receiving more than two dozen complaints about their practices.
A superior court judge reinstated all three licenses in October, pending the outcome of a hearing by an administrative law judge.
After a 10-day hearing in February and March in which the Department of Licensing called more than two dozen witnesses, Administrative Law Judge Terry A. Schuh affirmed six of the 10 alleged violations filed against the Hellicksons, and half of the 10 alleged violations lodged against their firm.
An attorney for the Hellicksons has filed a petition for review of Schuh's May 11 initial order. The Hellicksons' licenses remain in force while Schuh considers the issues raised in the petition and the Department of Licensing's response.
If the Hellicksons' petition is unsuccessful, the Department of Licensing will have 90 days from the May 11 initial order to revoke their licenses.
Michael and Tara Hellickson would then have the option of going back to Superior Court to challenge their license suspensions.
Schuh found that the Hellicksons and their firm engaged in a "pattern and practice" of listing homes at artificially reduced prices that didn't accurately reflect what the owner was willing to accept, in the hopes of generating multiple offers.
The Hellicksons misrepresented that they would buy homes listed with them that did not sell within 30 days, and that Michael Hellickson engaged in false advertising when he claimed to be the No. 1 agent in Washington, Oregon and Hawaii, Schuh ruled.
The Hellickson Team also "engaged in a pattern and practice of negligent and dilatory communications with homeowners, potential buyers, and lenders" by not responding to phone calls and e-mails in a timely fashion, resulting in unreasonable risk of harm to their clients, according to the ruling.
The administrative law judge also affirmed findings that Michael and Tara Hellickson drafted addendums to purchase and sale agreements requiring that buyers prequalify with one of two or three specific lenders, even though their clients had not requested or authorized such a requirement. Although the agreements were signed or initialed by sellers, Schuh found that such authorization was "uninformed," because the addendums were not requested by homeowners or discussed with them.
On the other hand, Schuh found that the Department of Licensing had not proved allegations that the Hellicksons encouraged homeowners to stop making their mortgage payments, or told them they were required to vacate their homes before they were legally required to do so.
The Department of Licensing also failed to prove allegations that the Hellicksons instituted automatic price reductions without authorization by the sellers, Schuh said in a May 11 initial order, setting those findings aside.
Although Schuh ruled that the Hellicksons had, in fact, failed to provide copies of executed listing agreements to homeowners as alleged, he set aside charges that the couple engaged in a "pattern and practice" of misrepresenting the contents of listing agreements, such as their term.
Hellickson, who's also known for the short-sale and REO (bank-owned property) coaching seminars he offers nationwide through another company, Club Wealth Inc., said he expects to prevail in his two-year battle with the Department of Licensing.
His refusal to turn over records sought by the Department of Licensing, he said, "stirred up the hornet's nest," and department staff seemed determined "to dig up anything I'd done wrong."
Clients, agents testify at hearings
To make its case against the Hellicksons, the Department of Licensing filed 296 exhibits and called 27 witnesses to testify, including former Hellickson Team employees and nearly a dozen past clients. Also testifying were several real estate agents who represented prospective buyers, and a Wells Fargo liquidation manager.
When the department brought charges against the Hellicksons and suspended their licenses in September, they had 400-500 listings, more than 200 of which were pending, Michael Hellickson testified.
In 2009 and 2010, about half the listings represented by the Hellicksons -- who conducted their business as "The Hellickson Team" -- were short sales, and the other half REOs.
The department received 37 complaints about the Hellicksons -- about 10 of which were filed after the department filed charges. The complaints referenced either Michael Hellickson or his team, but the Department of Licensing said it also sought to revoke Tara Hellickson's license because she was the co-listing agent on all of the listing agreements.
The department stopped communicating with the Hellicksons after receiving a Dec. 2, 2009, letter from their attorney, Douglas Tingvall, informing the department that the couple would no longer provide information or documents to the department because such requests allegedly violated their Fourth Amendment protections against unlawful search and seizure.
In his petition for review of Schuh's initial order, Tingvall said Michael Hellickson is "an innovator and a leader" in the short-sale business, and that innovators "become targets for competitors and regulators, who often do not understand or lag behind a rapidly changing environment." In the past, license revocations of five years or more have been the result of "criminal acts, serious moral turpitude, fraud, theft or other intentional mishandling of client funds," he said. The Hellicksons "were not found to have done any of these things."
A "disinterested observer" could conclude that regulators went on a "witch hunt" only to retaliate for the Hellicksons' refusal to provide records without a warrant or determination of probable cause, Tingvall argued.
The Department of Licensing, meanwhile, maintained that a 10-year license suspension, although "severe" and "rare," was justified because the Hellicksons allegedly committed a large number of violations, many violations were repeated, and they did not cooperate with the investigation or acknowledge or attempt to correct their conduct. Listing homes at artificially low prices was a serious enough violation that it, alone, might have resulted in a 10-year revocation, the administrator of the department's real estate unit, Jerry McDonald, testified.
30-day sale program
The Hellicksons' radio advertisements, for-sale signs, and website promised that they would purchase their clients' homes or sell them at no commission if they did not sell within 30 days. Although the ads noted that some restrictions applied, no ad said the 30-day program did not apply to short sales, Schuh found.
Schuh found that the purpose of the ads was to generate leads and listing agreements. The Hellickson Team, he determined, "had no intention of buying homes at anything close to market price."
Two agents employed by the Hellickson Team, Joe Toner and Jon Ryan Geersten, testified that they used a script when scheduling listing appointments that mentioned the 30-day offer. Geersten testified that when he expressed reservations about the offer, Michael Hellickson told him that the offer was contingent on the seller accepting a sale price that was 50 percent of market value.
Hellickson testified that the 30-day offer could not apply to short sales, because lenders would not accept such a low offer. He also testified that he had not purchased any homes under the 30-day sale program since 2008.
In his petition for review, Tingvall argued that there was "nothing false, deceptive or misleading" about the Hellicksons' 30-day sale program. The Department of Licensing offered no evidence that any consumers relied on it, Tingvall said, or that the Hellicksons refused to purchase any eligible homes.
The Hellicksons were under no legal obligation to post the restrictions that applied to the program on their website or in their newsletter, their lawyer maintained. "Obviously, (the Hellicksons) hoped that prospective clients would call them to ask about their services," the Hellicksons' lawyer argued in the petition for review. "The purpose of any advertising by a real estate broker is to generate calls and personal appointments."
False advertising
Tingvall noted that the Department of Licensing offered no evidence to refute Michael Hellickson's claim that no other agent did more business in Washington, Oregon or Hawaii in 2009 or 2010, or that he was not the leading expert on short sales in those states.
But Schuh found that the Hellickson was never licensed in Oregon or Hawaii, and would simply refer business in those states to someone who was. The Hellickson Team also advertised a loan company that "was not functional," and Michael Hellickson's license to originate loans and the license of the mortgage firm it was associated with had both expired.
Listing prices
Schuh said it was undisputed that the Hellicksons obtained authorization from their clients to make "substantial, arbitrary price reductions, usually every two weeks, simply because the home had not generated offers." The price reductions were "aggressive and frequent," and "apparently the prices were below what the lender would accept," Schuh wrote. "The implication is that (the defendants) were more interested in generating offers than they were in realistic pricing."
In November 2008, for example, The Hellickson Team listed the home of Dan and Kathleen Streight for $275,000. The asking price was then reduced at two-week intervals in increments of $25,000, to $175,000 by the week before Christmas.
"When Dan Streight learned from a real estate agent that the price on his home had dropped to $175,000, he and his wife were shocked because the lien holder had told Mr. Streight that (the lender) would not accept less than $240,000," Schuh wrote, citing Streight's testimony at the hearing.
Schuh found that the Hellicksons "engaged in a pattern and practice of listing homes at artificially reduced prices" in order to generate "multiple lowball offers." But he also determined that the preponderance of the evidence showed that the Hellicksons were authorized to do so by sellers through signed, preauthorized, price-reduction forms.
The Streights testified that they had verbally agreed to a series of $20,000 price reductions every two weeks. Although they did not discuss a bottom price, the Streights said they understood they would be notified in advance of any price reduction. They also claimed a price-reduction authorization form they signed was blank. The form, introduced as evidence at the hearing, called for price reductions of $25,000 every two weeks.
Michael Hellickson testified that the price-reduction authorizations he provided to short-sale clients were always completed at listing appointments. The Streights did not ask him to provide advance notice of price reductions, he testified, and he had not offered to do so. Schuh said he found Hellickson's testimony credible.
In another instance, the asking price on a condo the Hellicksons listed at $175,000 in September 2008 was reduced several times in two months, to $75,000, before bouncing back to $117,000 by the following February. The owner, Richard Smith, testified that he had agreed to lesser price reductions, that the form he signed authorizing price reductions was blank, and that his calls to the Hellickson Team office about price reductions were not returned.
Toner, the former Hellickson Team agent, testified that he was instructed to convince sellers to sign price-reduction forms with reductions of at least $25,000 every two weeks, but said he was never told to have clients sign blank price-reduction forms. Toner testified that when he started working with the Hellicksons in August 2009, listing prices were determined using comparative market analyses (CMAs) produced by Tara Hellickson.
But after a few months, Toner testified at the hearing, he was told to list homes for the amount owed to the lender. He said he continued to prepare his own CMAs to fulfill his responsibilities to the seller. Toner said no additional market research was done before preapproved price reductions were applied.
Michael Hellickson testified that he took a comparative market analysis (CMA) with him to each listing appointment, but that it was not his practice to perform a CMA before every price reduction.
An expert witness for the Department of Licensing, real estate agent Allison Ybarra, said preapproved price-reduction agreements are not, in themselves, violations of state licensing law.
The Hellicksons' pricing practices generated a number of complaints to their multiple listing service, Northwest Multiple Listing Service (NWMLS), most alleging that the asking price of a listing was not a good faith reflection of what the seller would accept, or that the lender would approve.
Justin Haag, NWMLS' director of policy and forms, testified that the MLS did not add the term "good faith" to rules governing the pricing of listings until the summer of 2009.
Haag testified that NWMLS had received 40 complaints about the Hellickson Team since 2004, most of them regarding pricing. A total of 18 complaints resulted in disciplinary action by the MLS against the Hellickson Team in 2009 and 2010 -- or about 3 percent of the Hellickson Team's sales in those years.
In his petition for review of Schuh's initial order, Tingvall said nothing in real estate licensing law prohibits preapproval for price reductions, and the department "has no business interfering with private contracts between brokers and competent adults." He also argued, "Short sales are different than typical retail sales … The department is out of touch with current trends and practices. Doing things differently is not the same as doing things negligently," he argued.
Listing agreements
The Hellickson Team office "was disorganized and inefficient," Schuh said in explaining how he was "persuaded that it repeatedly failed to provide clients with copies of the executed listing agreement" -- a breach of reasonable skill and care.
In his petition for review, Tingvall said evidence presented by the Department of Licensing on whether the Hellicksons failed to provide copies of listing agreements to sellers was "equivocal and unpersuasive."
And Schuh was not convinced that the Hellickson Team engaged in a pattern and practice of misrepresenting the terms of the listing agreement to clients, as alleged by the Department of Licensing.
One couple who had originally wanted a three- to six-month listing agreement, William and Kathleen Cody, said they were later surprised when a buyer's agent informed them that the listing agreement they signed in March 2009 would not expire until Dec. 31, 2013. William Cody said he did not read the listing agreement before signing it, but that parts were left blank -- a claim also made by other clients.
Michael Hellickson testified that any handwritten additions to listing agreements were added at the time of the listing appointment, and that nothing was added later. Hellickson said his listing agreements were typically for three to four years, to give him enough time to complete a short sale. Hellickson testified that he didn't want to make an investment in marketing a house only to have the seller relist with another agent.
In an audio recording advertising Hellickson's coaching seminars, which was introduced as evidence at the hearing, Hellickson said his listing appointments typically lasted 32 to 37 minutes, and that by the end of each appointment he had obtained a signed listing agreement, preapproved price-reduction form, and disclosure and other documents.
In the recording, Hellickson said he was able to obtain 50 to 75 listings a month, exercising "dominance" over clients using an approach he compared to "a trainer whacking a dog as hard as possible." Hellickson said he would bring four pens to listing appointments, because that would save eight minutes.
Michael Hellickson's former personal assistant, Theresa Jenkins, testified at the hearing that listing agreements and price-reduction authorizations were not always completed at appointments. Jenkins said she regularly saw signed listing agreements with blanks that had not been filled in.
There were several agents working for the Hellickson Team, she said, and she did not know which agents were not having clients complete documents at listing appointments.
Schuh found that while it was the Hellickson Team's "best practice" to complete listing agreements before obtaining clients' signatures, "compliance with this practice was not 100 percent."
Explanations of what was in the listing agreements was "likely sparse because Michael Hellickson had neither the time nor the inclination to volunteer to do so," Schuh wrote. "However, the sellers must take some responsibility to review a document for blanks before signing and to ask to be shown where provisions of particular concern to them were addressed."
Communication with clients
Schuh also found that the Hellickson Team's poor communications with clients, potential buyers, and lenders placed their clients "at unreasonable risk of harm or prejudice."
Toner testified that the Hellickson Team office was disorganized and hectic, causing delays in response to purchase offers and complaints from clients that office staff members were rude and nonresponsive.
Jenkins testified that files would go missing and that documents were not properly maintained, labeled and stored.
Joyce Watts, a real estate agent formerly employed by the Hellicksons, testified that she was under the impression that the Hellickson Team's office was understaffed and overwhelmed by the volume of business it did.
Monika Peltz, a Wells Fargo liquidations manager who was involved in the attempted short sale of the Streight's home, testified that the lender did not get offers on the home until they were nearly two months old, and never received all of the documents it needed.
Kathleen Streight testified that she was told by other Realtors that there were five or six offers on her home, but that buyer's agents could not get any information from the Hellickson Team on the status of their offers. Streight said that at one point, she left 10 voice mail messages with the Hellickson Team but did not receive a callback. Condo owner Richard Smith, too, testified that communication was spotty and his frequent calls were not returned.
Washington's real estate licensing law requires that real estate brokers "present all written offers, written notices and other written communications" between parties "in a timely manner."
But Tingvall noted that the Hellicksons were not accused of violating that provision of the licensing law. Instead, the Hellicksons were accused of violating more general statutes that address incompetence and negligence over their alleged failure to return phone calls in a timely fashion.
Returning phone calls might be a courtesy to the client, as Ybarra testified, "but it is not a legal requirement of real estate licensing law," Tingvall argued.
Wells Fargo could have lost or misplaced the short-sale packet they were originally sent, Tingvall said in his petition for review. The Streights, he said, ultimately elected to pursue a loan modification and "were not harmed by any alleged delay in presenting offers" to the bank, he said.
For short-sale specialists, communications with sellers and banks are among the biggest challenges, Tingvall said, as banks are backlogged with files and may take months to respond to an offer, and homeowners may themselves be unresponsive.
Preferred lenders
Schuh also affirmed the Department of Licensing's findings that without being asked to do so or authorized by their clients, the Hellicksons, through addendums to purchase and sale agreements, required that buyers prequalify with one of two or three specific lenders.
Michael Hellickson testified that the purpose of the requirement was to get a quick determination from a reliable lender that the buyer would qualify for a loan, before investing resources in a transaction that would only fall through. Hellickson said his brokerage did not receive any compensation for referring buyers to certain lenders for prequalification. Hellickson said the prequalification of buyers by preferred lenders was explained at listing appointments. But several clients said they had not discussed the requirement with Hellickson and did not read prequalification addendums they signed or initialed.
Failing to discuss any addendum with the client -- or representing that a requirement has been requested by the seller, when it has not -- is a violation of "reasonable skill and care" provisions of state licensing law, Ybarra and another real estate agent, Rebecca Beaty, testified.
But the federal Real Estate Settlement Procedures Act (RESPA) doesn't bar sellers or brokers from asking borrowers to prequalify with a preferred lender, Tingvall noted, as long as buyers aren't required to obtain loans from those lenders, and pay no fee for prequalification. Sellers or brokers can even require such prequalification by lenders that they have an affiliated business arrangement with, Tingvall said.
The Hellicksons would simply recommend that sellers request buyers to prequalify with one of the Hellicksons' preferred lenders, "a perfectly lawful and prudent request," Tingvall said.
In the Hellicksons' view, Tingvall said, prequalification by a known lender was "was more reliable and provided better security for their sellers."
Thursday, June 9, 2011
40% of Underwater Borrowers Took Cash Out of Homes
DAILY REAL ESTATE NEWS
Produced by Inman News
June 9, 2011
Sponsored by Lowe's
40% of underwater borrowers took cash out of homes
CoreLogic: Owners with home equity loans more than twice as likely to be upside down
By Inman News
Inman News™
Share This
Homeowners with home equity loans are more than twice as likely to be "underwater" as those who didn't take cash out of their homes, according to statistics compiled by real estate and loan data aggregator CoreLogic.
CoreLogic estimates that at the end of March, 22.7 percent of homeowners with mortgages -- about 10.9 million borrowers -- owed more on their mortgage than their home was worth. That's down slightly from an estimated 11.1 million underwater borrowers at the end of December.
Falling home prices can put borrowers who have little equity in their homes underwater. By allowing homeowners to convert equity they have in their homes into cash, home equity loans reduce the cushion borrowers have against price declines.
CoreLogic said that 38 percent of borrowers with home equity loans were underwater at the end of March, compared with 18 percent of homeowners who had no home equity loan. More than 40 percent of all underwater homeowners (4.5 million) have home equity loans, CoreLogic said.
As might be expected, CoreLogic found that the presence of a home equity loan also increased the amount of negative equity. Underwater homeowners who had taken out home equity loans owed $83,000 more than their home was worth, on average, compared with $52,000 for those who hadn't taken cash out of their home.
Past studies have shown that the higher a borrower's combined loan-to-value ratio (CLTV), the more likely they are to stop making payments on their loan. In many cases, borrowers will opt for a "strategic default" -- not because they can't afford the monthly payments, but because they don't believe their home will regain its value anytime soon.
CoreLogic found that borrowers with home equity loans were slightly more likely to default at "moderate" levels of negative equity, up to 115 percent CLTV. Beyond that point, the relationship reverses, and default rates were slightly higher among homeowners without home equity loans.
Among all underwater borrowers nationwide, the average amount of negative equity was $65,000. In states with higher-cost housing, the average was considerably higher. In New York, underwater borrowers had an average of $129,000 in negative equity, followed by Massachusetts ($120,000), Connecticut ($111,000), Hawaii ($98,000), and California ($93,000).
At the other end of the scale, underwater borrowers in Ohio had the lowest negative equity -- $31,000, on average -- followed by Indiana ($34,000), and Minnesota ($38,000).
Nevada led all states in the proportion of underwater borrowers -- 63 percent of Silver State homeowners with mortgages owed more than their home was worth -- followed by Arizona (50 percent), Florida (46 percent), Michigan (36 percent), and California (31 percent).
At the metro level, Las Vegas led the nation, with 66 percent of mortgaged properties underwater, followed by Stockton (56 percent), Phoenix and Modesto (55 percent), and Reno (54 percent).
Metropolitan markets located outside of the five states with the highest negative equity shares include Greeley, Colo. (38 percent); Boise (36 percent); and Atlanta (35 percent).
Produced by Inman News
June 9, 2011
Sponsored by Lowe's
40% of underwater borrowers took cash out of homes
CoreLogic: Owners with home equity loans more than twice as likely to be upside down
By Inman News
Inman News™
Share This
Homeowners with home equity loans are more than twice as likely to be "underwater" as those who didn't take cash out of their homes, according to statistics compiled by real estate and loan data aggregator CoreLogic.
CoreLogic estimates that at the end of March, 22.7 percent of homeowners with mortgages -- about 10.9 million borrowers -- owed more on their mortgage than their home was worth. That's down slightly from an estimated 11.1 million underwater borrowers at the end of December.
Falling home prices can put borrowers who have little equity in their homes underwater. By allowing homeowners to convert equity they have in their homes into cash, home equity loans reduce the cushion borrowers have against price declines.
CoreLogic said that 38 percent of borrowers with home equity loans were underwater at the end of March, compared with 18 percent of homeowners who had no home equity loan. More than 40 percent of all underwater homeowners (4.5 million) have home equity loans, CoreLogic said.
As might be expected, CoreLogic found that the presence of a home equity loan also increased the amount of negative equity. Underwater homeowners who had taken out home equity loans owed $83,000 more than their home was worth, on average, compared with $52,000 for those who hadn't taken cash out of their home.
Past studies have shown that the higher a borrower's combined loan-to-value ratio (CLTV), the more likely they are to stop making payments on their loan. In many cases, borrowers will opt for a "strategic default" -- not because they can't afford the monthly payments, but because they don't believe their home will regain its value anytime soon.
CoreLogic found that borrowers with home equity loans were slightly more likely to default at "moderate" levels of negative equity, up to 115 percent CLTV. Beyond that point, the relationship reverses, and default rates were slightly higher among homeowners without home equity loans.
Among all underwater borrowers nationwide, the average amount of negative equity was $65,000. In states with higher-cost housing, the average was considerably higher. In New York, underwater borrowers had an average of $129,000 in negative equity, followed by Massachusetts ($120,000), Connecticut ($111,000), Hawaii ($98,000), and California ($93,000).
At the other end of the scale, underwater borrowers in Ohio had the lowest negative equity -- $31,000, on average -- followed by Indiana ($34,000), and Minnesota ($38,000).
Nevada led all states in the proportion of underwater borrowers -- 63 percent of Silver State homeowners with mortgages owed more than their home was worth -- followed by Arizona (50 percent), Florida (46 percent), Michigan (36 percent), and California (31 percent).
At the metro level, Las Vegas led the nation, with 66 percent of mortgaged properties underwater, followed by Stockton (56 percent), Phoenix and Modesto (55 percent), and Reno (54 percent).
Metropolitan markets located outside of the five states with the highest negative equity shares include Greeley, Colo. (38 percent); Boise (36 percent); and Atlanta (35 percent).
Monday, June 6, 2011
Mortgage Rates Down Again
Typically this time of year, we see mortgage rates climb higher during the peak time of the season to buy (April through August). With the crisis in Japan and our economy in the U.S. growing at a snails pace, mortgage rates which spiked in early Spring are falling again.
The massive earthquake and subsequent tsunami in Japan and violent uprising in Libya might seem a world away from U.S. home loans, but in fact, these international events have a significant though circuitous and indirect effect on mortgage interest rates, says Jim Pomposelli, a mortgage banker at Mortgage Direct in Chicago.
Here's how it works: Negative events trigger fears about adverse impacts on the global and U.S. economies. Those fears prompt investors to leave the stock market and move their money into U.S. Treasuries and mortgage-backed securities. This behavior, called a "flight to quality," increases the demand for Treasuries, which results in higher prices and lower yields, or rates.
This week, investors behaved exactly that way. Then seemingly realizing their fears might have been overblown, they ditched the safer investments and returned to equities, only to regroup again and start the cycle over.
Meanwhile, lenders lowered and raised rates, sometimes within the course of a single day.
"It's all event-driven," Pomposelli says. "It's all a flight to quality and then it's unwinding that flight to quality as investors start to realize that the long-term economic impact, when they really look at it all, is not as bad."
Fed wants more jobs
In related news, the Federal Reserve this week announced that it will keep its target range for the federal funds rate between zero percent to 0.25 percent and stick with its plan, known as quantitative easing, or "QE2," to purchase $600 billion of longer-term Treasury securities by the end of June.
This stay-the-course mentality might have more to do with job creation than inflation, Pomposelli says. That has given investors, rather than the Fed, a greater influence over longer-term interest rates such as those on mortgage loans.
"I would argue that it's investors who are driving the 10-year Treasury, and subsequently, mortgage-backed securities because they are more concerned about inflation than the Fed is," he says. "But all this goes out the window when -- just think of the events that we've had -- (you have) something in Saudi Arabia, something in Bahrain, and then, you have Tokyo now. There's a lot of knee-jerk reaction and tremendous volatility."
Low rates help housing
Housing, which depends largely on employment, also may be on the Fed's mind, says Don Frommeyer, senior vice president of Amtrust Mortgage Funding in Indianapolis.
"The federal government understands that part of the (economic) recovery is housing and to keep things rolling, they have to keep housing affordable," he says. "Remember, every time that rates go up half a point, you just lost a huge percentage of the people who can buy a house."
Indeed, the Fed's statement noted that "the housing sector continues to be depressed."
Taken together, the global crises, jobless recovery and weak home sales hint that lower mortgage interest rates may stick around for a while, though the strengthening U.S. economy augers exactly the opposite.
Marcie Geffner supplied most of the information for this article.
The massive earthquake and subsequent tsunami in Japan and violent uprising in Libya might seem a world away from U.S. home loans, but in fact, these international events have a significant though circuitous and indirect effect on mortgage interest rates, says Jim Pomposelli, a mortgage banker at Mortgage Direct in Chicago.
Here's how it works: Negative events trigger fears about adverse impacts on the global and U.S. economies. Those fears prompt investors to leave the stock market and move their money into U.S. Treasuries and mortgage-backed securities. This behavior, called a "flight to quality," increases the demand for Treasuries, which results in higher prices and lower yields, or rates.
This week, investors behaved exactly that way. Then seemingly realizing their fears might have been overblown, they ditched the safer investments and returned to equities, only to regroup again and start the cycle over.
Meanwhile, lenders lowered and raised rates, sometimes within the course of a single day.
"It's all event-driven," Pomposelli says. "It's all a flight to quality and then it's unwinding that flight to quality as investors start to realize that the long-term economic impact, when they really look at it all, is not as bad."
Fed wants more jobs
In related news, the Federal Reserve this week announced that it will keep its target range for the federal funds rate between zero percent to 0.25 percent and stick with its plan, known as quantitative easing, or "QE2," to purchase $600 billion of longer-term Treasury securities by the end of June.
This stay-the-course mentality might have more to do with job creation than inflation, Pomposelli says. That has given investors, rather than the Fed, a greater influence over longer-term interest rates such as those on mortgage loans.
"I would argue that it's investors who are driving the 10-year Treasury, and subsequently, mortgage-backed securities because they are more concerned about inflation than the Fed is," he says. "But all this goes out the window when -- just think of the events that we've had -- (you have) something in Saudi Arabia, something in Bahrain, and then, you have Tokyo now. There's a lot of knee-jerk reaction and tremendous volatility."
Low rates help housing
Housing, which depends largely on employment, also may be on the Fed's mind, says Don Frommeyer, senior vice president of Amtrust Mortgage Funding in Indianapolis.
"The federal government understands that part of the (economic) recovery is housing and to keep things rolling, they have to keep housing affordable," he says. "Remember, every time that rates go up half a point, you just lost a huge percentage of the people who can buy a house."
Indeed, the Fed's statement noted that "the housing sector continues to be depressed."
Taken together, the global crises, jobless recovery and weak home sales hint that lower mortgage interest rates may stick around for a while, though the strengthening U.S. economy augers exactly the opposite.
Marcie Geffner supplied most of the information for this article.
Saturday, June 4, 2011
Track Crime Through Trulia!
This is great news from Trulia on Crime Maps...
TRULIA LAUNCHES CRIME MAPS TO ADD INSIGHTS AND MORE COMPLETE DATA TO AMERICAN NEIGHBORHOODS
Crime Maps Launch Provides Data on Neighborhoods Block-by-Block and adds Social Commenting to Aid Buying and Renting Decisions
SAN FRANCISCO, June 2, 2011 – Trulia, a top resource for homebuyers, sellers and renters, today expanded its product suite with the launch of Crime Maps, a innovative and proprietary social crime mapping technology that allows consumers to view, explore, compare, interact and comment on crime data across the US. With Crime Maps, Trulia gives consumers hyper-local visibility into the good, bad and ugly dynamics of neighborhoods, enabling them to make better decisions about where to buy or rent a home.
Crime Maps leverages geodata from multiple partners, including CrimeReports.com, EveryBlock.com and SpotCrime.com, who work with hundreds of police agencies, crime feeds and news outlets to create a curated map of criminal activity in many metropolitan areas. Users can view crimes in a specific area, toggle between multiple neighborhoods, and directly compare the crime statistics of two different regions. Trulia also enables users to add insights, comments, and advice via Facebook’s Social Comments for additional context and information on top of the geodata.
“Historically, detailed and easy-to-decipher crime reports haven’t been easily accessible to the average citizen, and Trulia aims to bring that data to light at the most important moment – when people are deciding where they should live,” said Pete Flint, co-founder and CEO, Trulia. “As a business, Trulia continues to move beyond public record data to in order to add more depth and details about what it’s like to live in a neighborhood. We’re leveraging the acquisition of the Movity team to build visual and innovative mapping platforms and integrate social features into the core of our user experience.”
Upon launch, Trulia’s Crime Maps will be available in 50 counties, with plans to quickly expand nationwide. Trulia provides a visual heat map analysis of historical data. To ensure that the crime-related information on each map is as accurate as possible, Crime Maps automatically displays the last 2,500 crimes committed in a given area.
“With the democratization of data, now we are capable of building a product like Crime Maps,” said Eric Wu, Head of Geo/Social Products at Trulia. “We’ll continue to not only aggregate this valuable geodata, but help users understand and consume it through beautiful products. Ultimately, we want to help paint a complete picture of location on a hyper-local basis, and we believe coupling data with social comments is a very powerful combination.”
In creating Crime Maps, Trulia has unearthed some interesting statistics about crime in America based on the 50 metros that are available at launch. Some highlights include:
Crime in America
* The top 5 most common crimes reported are (in order from most to least):
· Theft
· Assault
· Burglary
· Arrest
· Vandalism
* Time of day and type of crime are linked:
o Thieves typically strike while people are at work. Most thefts and burglaries are reported once people go home at noon around lunchtime or after work around 5pm.
o Vandalism is typically reported in the morning around 9-10am when it’s easier for people to see criminals in the act.
o Violent crimes such as assault and robberies typically happen at night around 9-10pm while people are out on the town or on their way home from an event.
TRULIA CRIMEMAPS:
* Neighborhood Crime Insights: Learn more about a neighborhood’s crime statistics using large interactive maps to view where and what types of crimes occur in neighborhoods across America. Compare time-of-day data, stack statistics of one neighborhood against another and dig in deeper to the details of crimes.
* Heatmaps – shows historical crime during the past twelve months
* Social Commenting: Via Facebook’s social plug-in, users can leave detailed comments about areas, providing local, personal and relevant context to the Crime Maps data.
ADDITIONAL ASSETS
· To view and explore Crime Maps
· To view a video about Crime Maps
· To view a slideshow of the findings
· To view Crime Maps methodology
· To download high-resolution screenshots of Trulia’s Crime Maps
About Trulia, Inc.
Trulia is the fastest growing online real estate resource, empowering buyers, sellers and renters with smarter tools to help them find the right home. Trulia helps you find the home that best meets your specific needs. Our smart and personalized real estate search experience brings together local information, community insights, market data and national listings all in one place. Trulia is headquartered in downtown San Francisco and is backed by Accel Partners and Sequoia Capital.
TRULIA LAUNCHES CRIME MAPS TO ADD INSIGHTS AND MORE COMPLETE DATA TO AMERICAN NEIGHBORHOODS
Crime Maps Launch Provides Data on Neighborhoods Block-by-Block and adds Social Commenting to Aid Buying and Renting Decisions
SAN FRANCISCO, June 2, 2011 – Trulia, a top resource for homebuyers, sellers and renters, today expanded its product suite with the launch of Crime Maps, a innovative and proprietary social crime mapping technology that allows consumers to view, explore, compare, interact and comment on crime data across the US. With Crime Maps, Trulia gives consumers hyper-local visibility into the good, bad and ugly dynamics of neighborhoods, enabling them to make better decisions about where to buy or rent a home.
Crime Maps leverages geodata from multiple partners, including CrimeReports.com, EveryBlock.com and SpotCrime.com, who work with hundreds of police agencies, crime feeds and news outlets to create a curated map of criminal activity in many metropolitan areas. Users can view crimes in a specific area, toggle between multiple neighborhoods, and directly compare the crime statistics of two different regions. Trulia also enables users to add insights, comments, and advice via Facebook’s Social Comments for additional context and information on top of the geodata.
“Historically, detailed and easy-to-decipher crime reports haven’t been easily accessible to the average citizen, and Trulia aims to bring that data to light at the most important moment – when people are deciding where they should live,” said Pete Flint, co-founder and CEO, Trulia. “As a business, Trulia continues to move beyond public record data to in order to add more depth and details about what it’s like to live in a neighborhood. We’re leveraging the acquisition of the Movity team to build visual and innovative mapping platforms and integrate social features into the core of our user experience.”
Upon launch, Trulia’s Crime Maps will be available in 50 counties, with plans to quickly expand nationwide. Trulia provides a visual heat map analysis of historical data. To ensure that the crime-related information on each map is as accurate as possible, Crime Maps automatically displays the last 2,500 crimes committed in a given area.
“With the democratization of data, now we are capable of building a product like Crime Maps,” said Eric Wu, Head of Geo/Social Products at Trulia. “We’ll continue to not only aggregate this valuable geodata, but help users understand and consume it through beautiful products. Ultimately, we want to help paint a complete picture of location on a hyper-local basis, and we believe coupling data with social comments is a very powerful combination.”
In creating Crime Maps, Trulia has unearthed some interesting statistics about crime in America based on the 50 metros that are available at launch. Some highlights include:
Crime in America
* The top 5 most common crimes reported are (in order from most to least):
· Theft
· Assault
· Burglary
· Arrest
· Vandalism
* Time of day and type of crime are linked:
o Thieves typically strike while people are at work. Most thefts and burglaries are reported once people go home at noon around lunchtime or after work around 5pm.
o Vandalism is typically reported in the morning around 9-10am when it’s easier for people to see criminals in the act.
o Violent crimes such as assault and robberies typically happen at night around 9-10pm while people are out on the town or on their way home from an event.
TRULIA CRIMEMAPS:
* Neighborhood Crime Insights: Learn more about a neighborhood’s crime statistics using large interactive maps to view where and what types of crimes occur in neighborhoods across America. Compare time-of-day data, stack statistics of one neighborhood against another and dig in deeper to the details of crimes.
* Heatmaps – shows historical crime during the past twelve months
* Social Commenting: Via Facebook’s social plug-in, users can leave detailed comments about areas, providing local, personal and relevant context to the Crime Maps data.
ADDITIONAL ASSETS
· To view and explore Crime Maps
· To view a video about Crime Maps
· To view a slideshow of the findings
· To view Crime Maps methodology
· To download high-resolution screenshots of Trulia’s Crime Maps
About Trulia, Inc.
Trulia is the fastest growing online real estate resource, empowering buyers, sellers and renters with smarter tools to help them find the right home. Trulia helps you find the home that best meets your specific needs. Our smart and personalized real estate search experience brings together local information, community insights, market data and national listings all in one place. Trulia is headquartered in downtown San Francisco and is backed by Accel Partners and Sequoia Capital.
Subscribe to:
Comments (Atom)
