Foreclosure Homes Investing

Find Foreclosures for Sale in the Vacant Lands of Las Vegas

Investors are now again rushing to find foreclosures for sale in the vacant lands of Las Vegas at bargain prices. As the number of new homes continues to dwindle, home builders and housing investors have been accumulating home lots and developable land for residential projects when demand for new homes will again rise.

According to Hoffman Company and Home Builders Research, there are currently 17,500 developed lots in Las Vegas and 2,500 of these lots are for sale. The rest are still being held by lenders, investors and builders waiting for higher prices.

Over the past months, land prices in Las Vegas have been rising because of the shift of investor attention from homes to land, according to Cameron Fowler of California-based Hoffman Company which recently opened its branch in Las Vegas.

Although home builders hold around three years of land supply in Las Vegas, the number of groups owning land banks has been increasing, according to Ken Perlman, a top executive of San Diego-based Sullivan Group Advisors. The quick emergence of land banks shows that efforts to find foreclosures for sale in vacant lands have been successful for these groups.

Among home builders looking for more developed lots are KB Home, DR Horton, Richmond American and Harmony Homes, according to Dennis Smith, head of Home Builders Research. He added that home builders sold their lots over the past few years as land values sharply fell and are now back in the market before prices reach their high levels.

According to Smith, prices for developed lots range from $25,000 through $45,000 depending on size and location, substantially lower than the $100,000 price level, which was the lowest level for developed lots during the boom years.

Investors have been buying lots with plans to sell them after three years or more, but may sell them earlier if home builders need more lots and are willing to buy at premium prices. They are hoping that lots will sell at good prices within the next two years.

According to Richard Gollis, a top executive of California-based property consulting firm Concord Group, the city of Las Vegas accumulated a total of 32,000 developed lots, unsold new houses and foreclosure homes over the past five years.

In addition to looking at developed lots, investors can also find foreclosures for sale in raw lands, including vacant lands in the Kyle Canyon master-planned community which was foreclosed by lenders.

Find Home Foreclosures in Top-Ranking Cities

Find home foreclosures in cities with the highest rates of foreclosures in the July to September quarter. Based on a report released this week on foreclosures in the 203 largest metro areas in the country, there are now cities previously not experiencing spikes in foreclosures that have entered the top 20 list.

The metro areas which occupied the top of foreclosure charts over the past quarters are still on top of the charts, such as Merced and Stockton in California, but their foreclosure rates have declined.

The new cities that soared through the top 20 of the list were Reno, Nevada, whose foreclosure rate of one in 37 homes represented an 80-percent jump from the same three-month period last year. It is now ninth in the foreclosure chart.

Another is Boise, Idaho, where the pace of foreclosures jumped by a staggering 141 percent – the highest rate of increase from 2008 among all metro areas. Foreclosures in the city of Provo in Utah also soared, climbing up by 120 percent.

According to analysts, the rise in foreclosures in cities where previously investors cannot find home foreclosures in large numbers was largely caused by sharply growing job losses and the adjustment of flexible mortgage loans to higher rate levels.

In the Reno-Sparks area, the unemployment rate reached 13.1 percent in September, marking a significant rise from 12.4 percent in August and from 7.3 percent in September 2008, based on data from the Nevada Department of Employment, Training and Rehabilitation.

In the Boise-Nampa metro area in Idaho, the unemployment rate hit 9.5 percent, with the number of jobless workers rising from 15,700 workers to 27,300 workers in September this year and the total work force dropping from 292,700 to 288,000.

The unemployment rate in the Provo-Orem area in Utah meanwhile reached 5.5 percent in September, a low number compared to other city jobless rates, but very high compared to the city’s jobless rate of only 2.9 percent in September 2008.

Among all of the 203 metro areas surveyed, the Las Vegas-Paradise area still dominated the foreclosure rate chart. One in every 20 houses in the area in the July to September quarter received a default or foreclosure notice, marking a 53-percent increase compared to the same three-month period last year.

Other cities where one can find home foreclosures based on third-quarter filings are Merced, Stockton, Modesto, Riverside, Bakersfield and Vallejo in California and in Cape Coral and Port Saint Lucie in Florida.

Buy a Foreclosed Property for Sale with Discount in Tampa

Buy a foreclosed property for sale in Tampa, Florida where home price discounts are almost double the nationwide median discount.

According to an online real estate research company, the negotiating power of home buyers nationwide has dropped in August because of tighter supply of homes for sale in some markets, but in Florida, homebuyers still have great negotiating power.

Throughout the country, home buyers received a median discount of 3 percent or $6,525 from the listing price in August, a decrease from the median discount of 3.3 percent or $7,018 received by home buyers in July.

But in the Tampa metro area, homebuyers received much higher discounts in August. The median discount was $10,320, equivalent to 5.9 percent, which is almost double the nationwide median price discount.

Among the counties in the Tampa Bay area, Sarasota gave the highest level of discount to homebuyers, cutting off $19,782 or nearly 8 percent of the listing price. Sarasota also ranked third in price discounts compared to all metro areas in the country, next to Vero Beach and the Naples metro area.

Economists said homebuyer negotiating power is an indication of the current supply of homes in an area. With the continued entry of foreclosure properties into the Tampa Bay market, an investor looking for a profitable home can buy a foreclosed property for sale in the Tampa area and obtain substantial discounts.

While the national median discount is much higher than the median in the Tampa area, home price discounts nationwide are expected to rise again because of the expected release of foreclosures by lenders in the coming months.

One significant finding in the report is the behavior of home prices in August in two California areas hit badly by foreclosures. In Stockton, the city considered the symbol of the first wave of the foreclosure crisis, home buyers in August did not get a discount, but instead paid higher than the listing price by a median of 1.3 percent or $2,515. In El Centro, homebuyers paid 2.2 percent or $2,479 more than the listing price.

According to the home price discount report, the negotiating power of home buyers reached its highest level in January when home buyers received a discount of 4.5 percent or $10,096 from the listing price, providing any buyer of a low-priced foreclosed property for sale with further discounts and further profit opportunities.

Investors, Non-Profits Compete for Cheap Houses for Sale

Since the Obama Administration launched its Neighborhood Stabilization Program to help neighborhoods severely affected by the growing number of cheap houses for sale, many nonprofit groups get into the task of buying, renovating and re-selling foreclosure properties.

But they are not the only groups that have developed an interest on foreclosure houses. Investors laden with cash also plunged into the foreclosure investing market. And it seems that they are getting ahead of the game as non-profits are finding it difficult to find cheap houses for sale because investors are always a step ahead of them.

The non-profit organization, Family Resources Inc. received around $400,000 from the U.S. Housing and Urban Development’s (HUD) Neighborhood Stabilization Program (NSP). The agency plans to use the funds to purchase duplexes, fix and rent them out to young adults who are transitioning from foster care. But so far, the search for good deals is fruitless.

Industry experts said that despite the huge number of foreclosure houses on the market, many nonprofits are having difficulty finding the right homes to purchase, renovate and resell or rent to eligible low-income families.

Non-profit organizations said that most often than not, they are being outbid by cash-rich investors who grab foreclosure houses, particularly in the low-end market. Officials of non-profits said that there are a lot of good deals on the market but there are always multiple biddings and many of them are not immediate cash buyers.

According to industry, the influx of investors laden with cash on the foreclosure investing market has resulted to few good deals left for local nonprofit organizations that are constrained by tight spending deadlines, limited funding and spending restrictions.

Experts said that also joining the fray for good foreclosure deals are first-time homebuyers who are motivated to make purchases by the federal tax credit of $8,000. Many first-time homebuyers prefer choice houses which means that they have set their sights on properties at the second or third tier.

The current trend in foreclosure purchasing has resulted to limitations on the number of local homes that would eventually be purchased under the NSP. In Manatee County, Florida, the local government received about $5.28 million NSP grant which has been distributed to several nonprofit organizations.

The city of Bradenton has received $2.57 million for its program to buy cheap houses for sale, fix and resell them and to assist buyers on down payment.

Foreclosure Auction Listings Add Arizona Condominiums

The foreclosure auction listings in Tucson, Arizona have added two condominium conversion projects after their developer defaulted on the almost $47 million loan.

In July 2007, UBS Real Estate Investment Inc. loaned almost $47 million for two condominium projects, the Williams Centre and Tierra Vida Apartments. According to the Arizona Corporation Commission records, Terry Brown is the identified manager for the conversion condominium projects.

The trustee’s sale for the foreclosed condominiums will be held on December 23. Scotia Group Management LLC Principal Rob Aronoff explained that the placement of the condominiums on foreclosure auction listings will not affect their residents, whether these people own or rent the units.

He said that the homeowners’ association of condominium residents is fully funded, with assessments fully paid. He added that the association has capital reserve that it can use for future projects.

According to industry experts, Brown initially plans to convert into condominiums the Tierra Vida Apartments. However, the weakening economy had stopped the conversion. Currently, Tierra Vida’s 200 units are 92 percent occupied.

On the other hand, the Williams Centre condominiums are occupied by owners and renters. Out of the 344 condominium units in the building, 105 were sold. The unsold 239 units are still under Brown’s name, with many of them being rented. The Scotia Group is handling the management of the condominium units and maintenance of the homeowners association.

Industry experts noted that managing the condominium conversion project is not easy because it means dealing with many people who have different needs. Compared with renters who are transient, homeowners want stability.

In 2007, the condominium market in Arizona, just like in other real estate business, experienced unprecedented growth, with 1,013 sales. But for the first seven months this year, condominium sales reached only 314. Meanwhile, condominium units in Arizona had a median sale price of $93,000 in August. The figures are way below the median sale price of homes which reached $162,575.

Industry experts explained that prices for condominiums are high because of the exorbitant costs of converting apartments into condominium units. They added that condominium conversion is a good investment move three years ago but not today.

They advise families to buy properties on foreclosure auction listings rather than rent because there are so many good deals to be had on the residential real estate market.

Buy Foreclosed House in Austin for Rental Investment

Investors planning to buy foreclosed house for rental investment can realize their dream in Austin, Texas after the foreclosure of three Class A-plus housing complexes that have a total of 1,417 units.

The complexes, which were purchased in 2007 by CNC Investments for approximately $190 million, are now being sold without an asking price.

According to Patton Jones of Apartment Realty Advisors, the housing units are luxurious. He added that the 583 units at Monterone Round Rock average about 1,200 square feet in area and feature a wide-screen surround-sound theater room and a wine cellar.

Jones however is realistic about his sales prospects for the units during the downturn. He said that renters now are more focused on saving money so they are looking at smaller units with fewer amenities.

Nonetheless, Jones said, the amenities at the three complexes which include the Monterone Steiner Ranch and the Monterone Canyon Creek, will make these luxurious buildings in demand when the market has already recovered.

Jones explained that because of the lack of financing for commercial development such as multifamily projects, there are only a few higher-end multifamily developments in and around Austin, making the Monterone assets very attractive to investors planning to buy foreclosed house in Austin that can be rented out for profit.

Additionally, despite the foreclosure, the three complexes remain attractive to investors because they are 92-percent occupied and the buildings are only ten years old.

According to Jones, who leads the team marketing the luxurious residential portfolio, the three complexes are being marketed as a single asset. The commercial loan covering the developments has an interest rate of 5.77 percent. Purchase offers are being accepted until the last week of October.

Jones is expecting private and public real estate investment trusts to look at the properties. He is also hoping that wealthy individual investors will now come out after 8 or ten years of waiting in the background to look at the Monterone assets. He said that wealthy investors often invest in a cycle, preferring to buy properties when the market is soft.

For other individual investors who are planning to buy foreclosed house not in blocks but in units because of their limited investment money, they can wait until bigger real estate institutions or wealthy investors buy the complexes and then resell the housing units separately.

Buy Foreclosure Property in Oklahoma in the Next 7 Months

Buy foreclosure property in Oklahoma within the next seven months to take advantage of bargain prices, according to analysts of home sales statistics provided by the Oklahoma Association of Realtors.

Based on data from the realtor association, the average sales price for an Oklahoma home dropped by 3.4 percent from $150,559 in the second quarter of 2008 to $145,413 in the second quarter this year. The median price dropped sharply to $106,901.

Throughout the state, a total of 12,130 houses were sold in the second quarter, a drop of 11 percent from the 13,626 units sold in the same quarter last year.

One reason why it is time for prospective buyers in Oklahoma to buy is the finding that houses for sale across the state stay in the market for an average of 115 days, equivalent to nearly four months. This fact is significant because as properties stay longer in the market, brokers and sellers tend to reduce their asking prices so that their properties receive attention in multiple listing services and in online search listings.

Another reason to buy foreclosure property in Oklahoma now is the availability of foreclosures that are in good condition in the state. Analysts in the state advise that prospective buyers find a broker who is experienced in negotiating short sales so they can take advantage of well-maintained houses being sold by homeowners who want to keep their credit records free of foreclosures.

Just like in other states, the financial benefit of taking advantage of the federal tax credit is another major reason for first time home buyers to make their home purchase now. This benefit is expiring at the end of November and it is not yet certain if this incentive will be extended by the Obama administration.

Prospective home buyers oftentimes wait until spring or summer before they buy a home because they believe that the best home purchase deals are made during these traditional seasons of home buying. But if they examine the housing market, there are also bargains and even better deals during the first and last quarters of the year, as can be seen in the Oklahoma housing market.

According to housing analysts in Oklahoma, during times of difficulties, realtors and brokers also work harder, providing better services to be able to encourage prospective home buyers to buy foreclosure property or any other residential property in Oklahoma.

Tax Foreclosure for Sale, REO and Short Sales in Wichita

Although foreclosure-related residential sales in Wichita, Kansas have been slowing down recently, there are still a lot of homes in foreclosure for sale, short sales and tax foreclosure sales across the city, based on data used by real estate brokers and investors in the area.

According to area brokers, the biggest bargains now in Wichita may be found in tax foreclosure sales. For the next scheduled tax foreclosure auction at the Sedgwick County Extension Center, there will be around 250 residential properties to be auctioned, according to Ron Estes, the county treasurer of Sedgwick.

Estes said that in Sedgwick, buyers of tax foreclosures are not required to pay the delinquent taxes. They only have to pay the taxes due for the year 2009. He added that all foreclosure sales are final and that buyers are required to pay immediately. He said though that the county does not give any kind of guarantee.

He also advised prospective buyers to make research on the properties to prevent any surprises. Many of the foreclosures may also have been reclaimed by property owners before the scheduled auction.

In Wichita, real estate owned properties are oftentimes given by banks to select real estate brokers or investors. They want to spend the least time and effort on managing their REOs so they prefer selling in bulk to investors or to brokers with proven records of selling REOs at high prices.

With this practice, individual buyers are rarely given the opportunity to buy the best bargains in REOs. Only when the foreclosed homes given to brokers are not sold within 45 days do banks and brokers reduce their prices.

For people waiting for HUD homes, HUD properties are also sold just like REOs through selected brokers. Additionally, the HUD asking price is final and the price cannot be negotiated. Buyers are also required to obtain pre-approval certifications from lenders or documents showing that they can pay in cash.

Individual buyers can wait for homes that stay long in the market as HUD often reduces its asking prices for its listed homes that are unsold after about 30 days.

According to lawyer Frank Ojile who has been doing foreclosure work for years, investors can also make profits in pre foreclosures if they are knowledgeable about the short sale process and about finding homeowners who have accumulated substantial home equity but are already facing foreclosure and who are willing to sell at a loss.

Indicators Rose in July despite Foreclosures for Sale

Despite the continued rise in mortgage delinquencies and foreclosures for sale in many markets in the second quarter, leading economic indicators rose in July, according to the Conference Board.

The index of leading indicators increased by 0.6 percent in July, the fourth consecutive increase of the index. The index is designed to predict economic activity in the next 3 to 6 months.

With the continued rise of the index, analysts contend that the recession is bottoming out and that economic growth will soon begin. The gross domestic product, which has declined for 4 consecutive quarters, will likely grow this third quarter, according to Ken Goldstein, top economist of the Conference Board.

Economists set the value of the index by evaluating employment data, stock prices, GDP, interest rates, consumer confidence and other major factors that affect economic trends.

Wells Fargo economic analyst Tim Quinlan contended that the downturn ended in June based on the principles being applied by the National Bureau of Economic Research. He explained that the bureau, which is the agency officially calling the start and end of economic conditions, has historically set the date of the end of recessions after consecutive months of increases in the major economic indicators.

Economist Goldstein added that even when the recession is officially ended, consumers and businesses will still feel the effects and will not feel that the downturn has ended.

Another economist, Jennifer Lee of BMO Capital Markets, said the country probably experienced economic growth early in the quarter when Cash for Clunkers program pushed auto sales to higher levels.

The board said that 6 of the 10 major economic indicators that consist the Conference Board index rose in July, including stock prices and employment figures.

Among the 10 indicators, the biggest increase occurred in interest rate spread. This refers to the difference between federal funds rates and returns on ten-year Treasury securities. Federal funds rates are the rates charged by banks for loans they provide to each other. If the interest spread is higher, it is a positive sign because it means investors have the capability to lend for longer periods.

The Federal Reserve has been trying to keep the federal funds rate at near zero to help stabilize the market.

The negative factors are unemployment, delinquencies and foreclosures. Based on a report from the Mortgage Bankers Association, over 13 percent of homeowners nationwide are in default or in foreclosure largely because of unemployment.

Over 120 Foreclosure for Sale Condos in Hartford

A total of 129 condo units in Hartford, Connecticut are expected to become foreclosure for sale after lender Wells Fargo Bank Minnesota filed a foreclosure case in April against Bushnell Regency LLC which purchased the condo units and which has been renting them out to tenants.

The 129 condo units represent over two-thirds of the 180 units of the Hartford condo complex named Bushnell on the Park. Bushnell failed to pay its monthly loan payments of $75,000 to Wells Fargo Bank since November last year.

In 2002, Bushnell took out a commercial property loan of $12.8 million from Wells Fargo to acquire the condo complex for $15.6 million. In April, when the bank filed the foreclosure case, the amount due was $12.8 million, excluding late charges, interests and other fees, based on the papers filed with the Hartford Superior Court. In subsequent documents filed with the court, the total amount owed has already reached $14.5 million.

Bushnell on the Park was constructed in 1969, as the state and the city spent money to develop downtown Hartford to attract more residents in partnership with private developers. The development efforts have been continuing as newer apartment complexes are being constructed. The newer downtown apartment complexes include the Trumbull on the Park, Lofts at Main and Temple and Hartford 21.

According to Hartford apartment businessman Arthur Anderson, despite its age, Bushnell on the Park has been successful in getting tenants. He contended that the owners had cash flow difficulties and were unable to get loan refinancing. He added that the failure is more of a result of the recession than on the performance of the building.

Reporters could not pinpoint the real cause of the financial difficulties as representatives of various parties refused to divulge further information. Based on city real estate records, Bushnell Regency also failed to pay its taxes for other condo units that it owns and runs in the city. City officials said Bushnell has filed tax appeals.

Meanwhile, Marty Kenny, developer of the nearby Trumbull on the Park, said that the occupancy of the Bushnell complex is high. He contended that the problem may have been driven by the high acquisition cost and the big amount of loan it was taken to acquire the building. He said that operational expenses are also debilitating.

Another Hartford developer, Phil Schonberger, supported Kenny’s analysis. He explained that a lot of commercial loans taken out during the boom were based on rosy projections.

Find Foreclosures for Sale in the Vacant Lands of Las Vegas

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Buy a Foreclosed Property for Sale with Discount in Tampa

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Investors, Non-Profits Compete for Cheap Houses for Sale

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Foreclosure Auction Listings Add Arizona Condominiums

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Buy Foreclosed House in Austin for Rental Investment

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Buy Foreclosure Property in Oklahoma in the Next 7 Months

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