What To Expect in Real Estate for 2012 – Todd’s Real Estate Prediction

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Very often, Realtors are asked about the current state of the real estate market and though it’s an ever-changing industry involving volatility at times and major upswings at others, knowledge alone can change one’s experiences in real estate.
 So to provide some insight and guidance into what we can expect to see in the coming year.  Based on years of experience and after following trends that have led us up to this point, here are ten real estate things that I predict will be occurring in 2012. 

Unremarkable Appreciation Values

Even though we can see the market heading in the right direction, it appears that 2012 will be yet another year where there will be little to almost no appreciation on properties.  Prices will continue to fall, often as a result of buyers bidding that driving down the very prices they are concerned about as homeowners.   Keeping in mind that still more inventory will be coming in this year, noteworthy appreciation is still a thing of the distant future.

Unscrupulous Short Sale Activity

Surprisingly, there is a lot of short sale fraud going on in the nation and as short sales continue to control a sizable portion of the market we will continue to see fraudulent activity in that area of real estate.  Seller payoffs by investors wishing to cash in on short sale deals, secondary lien holder payoffs or cases where a buyer purchases a short sale only to resell it back to the seller again – all are examples of what we are seeing and what we will see more of in 2012.

Government Programs Providing Little Relief

Though their hearts are in the right place, government agencies that are providing relief through programs such as HARP (Home Affordable Refinance Program) will continue to offer them however homeowners will receive little relief.  Loan modification programs stop the bleeding but they do not reduce the principal, effectively leaving homeowners to find themselves in default once again.

Bulk Foreclosure Sales

There has been significant controversy over the term “shadow inventory” in the recent past and this coming year a lot of this shadow inventory will find itself on the market.  Banks will unload many foreclosure properties on the market this year, selling them in bulk with the intent to sell them quickly and more efficiently.  The sale prices will also reflect this convenience for banks with discounts for buyers buying several properties at one time.

Short Sales On the Rise

As we have seen during the past few years, short sales have been a popular solution for homeowners facing default and a favorite for buyers looking for a great deal on a home.  In 2012 we will see short sale trends continuing to rise.  Looking at the numbers from 2009 to present, there is a huge upward trend on short sales that is predicted to be as many as 150,000 this year.

Veteran Loans Increasing

Now that the war in Iraq is over we will see a large number of veterans returning from overseas looking for housing.  Loans supported by the Veterans Administration will be on the rise this year across the nation with such benefits as no down payment or waived funding fees.

Lease Option Sales Offered By Banks

A new, and very viable, alternative for homeowners facing foreclosure is the concept of lease option sales.  More and more lenders are offering this option to homeowners as a chance for them to rebuild their financial lives yet remain in their homes.  Banks go ahead with foreclosure but then offer the same home back on a lease option.  With demonstrated timely payments as they rebuild their credit, homeowners will have a chance to buy back their home. 

Renovations and Remodels Replacing New Purchases

The economy is improving but ever so slightly and as we deal with still very high unemployment numbers, the trends in real estate that is currently owned will reflect that.  Rather than move into new homes, we will see homeowners working to repair or renovate their existing homes to save money.

Mortgage Holders Will Move to Shorten Terms

Interest rates have been in the news for a long time and they will continue to dominate the real estate industry.  With no immediate change in the history low interest rates we have been seeing for the past two years or so, more and more people will move to shorter amortization terms and effectively pay their homes off in half the time, if not more. 

Surge in Second Home Sales

Given the ripe market for buyers we will continue seeing a huge surge in the purchase of secondary properties this year.  Whether looking for resort locations, vacation properties, rental properties or even retirement homes – consumers will take advantage of the low prices, low interest rates and high inventory.

Ten Things Real Estate Agents Help Take Care of When Buying a Home

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You may have heard the common question asking why anyone would want to hire an agent to help buy a home. The fact of the matter is that real estate agents have many services to offer on all sides of the real estate equation. We all know what they do to assist us in selling our homes but did you know that there is equally as much, if not more, that they can assist us with when buying? Industry jargon coins it Buyer’s Value Proposition – and to make it simple we’ve listed ten things, from start to finish, helping to clarify exactly why, if you’re in the market to buy a property, hiring a real estate agent is a very smart initial move to make.

Needs Analysis

Agents thoroughly assess your needs as a buyer and assist you with identifying how you define the ideal home. They focus on the things that matter most to buyers in a home so that finding the right home is a much more fruitful endeavor.

Pre-Qualification and Pre-Approval
Choosing a loan officer can be a daunting task if you are out there on your own. An agent has a solid rapport with qualified loan officers in the region and they connect you with one to suit your needs, see through the process of getting pre-qualified and then approved. Terms are then negotiated to be in the buyer’s favor and assistance with finding the best possible mortgage financing is also provided.

Neighborhood Information

Understanding and listing a buyer’s selection of neighborhoods, real estate agents also compile data for each locale that helps to center in on which neighborhood is the right one.

Home Search Multiple List Services

Helping you to gain access to a large number of properties, agents arrange a home search process that makes accessing and perusing a MLS much simpler and useful at the same time. Not only that, your agent will keep you updated regularly, provide you assistance with drive-by home visits and coordinate home showings of the ones you are interested in.

Making Offers

When you center in on a home after going through the entire prequalification and then search process, the last thing you want to do is to make a decision that could hurt your chances of getting that ideal home. Agents go through the process with you, offering advice on terms so that you can be confident in your decision. Once the offer is decided, the contract is filed out with your agent’s help.

Negotiation to Buy

One less thing for you to worry about, your real estate agent will handle the process of taking your offer to the seller and his/her agent and negotiate the purchase on your behalf.

Coordination of Vendors

With so many vendors also in the picture for things ranging from the mortgage, title and insurance to other important aspects of the real estate deal, some coordination is required. As real estate agents, most deal with vendors on a regular basis and your own agent can help connect you to reputable vendors.

Preparation Prior to Closing

The main thing to be careful on is the documents right before closing on your new home. With assistance on all pre-close preparation, including document generation, agents also provide consultations to make sure the buyer is comfortable with all stages of the process and is ready to proceed.

Closing of the Sale

Providing a watchful eye and a helpful hand, real estate agents play a pivotal role in making sure all things are lined up during the closing stage of your new home purchase. Working to make everything as smooth as possible, you will be guided and then provided help throughout, until the final transaction is successful.

After Closing Assistance

Once all is said is done, the real work begins. Your agent will provide you support and backing to make the move-in process as smooth and effortless as possible. Whether assistance with moving your household items or learning about the new neighborhood you will be given ample help on that front, or in any thing you may need.

It’s an often misconstrued fact that real estate agents are very useful for the all-around real estate process; whether you are looking to sell or buy, you can definitely benefit from the supportive hands of your local agent.