PCS Title Update…Good Stuff!

 

PCS Posts

By Joseph E. Seagle, Esq.● Jul 15, 2022 Smart Brevity® count: 3 mins... 835 words

👋 Top of the day to you! A ⛈️ rain storm Wednesday evening had me walking to my car through three inches of water with trash bags rubber-band-strapped over my shoes. Here’s hoping our Central Florida ☔ monsoon season eases out the door sooner rather than later.

1. Big thing: Housing drives inflation On Wednesday, the US Labor Department reported that inflation increased 9.1% over the last 12 months, the fastest increase in consumer prices since 1981.  Why it matters: This increase was much higher than expected. To cool it, the Fed will continue raising interest rates at a sharp clip for the foreseeable future, which in turn will continue increasing mortgage borrowing rates as well. Core inflation, which strips out food and energy price increases, rose only at 5.9% which was a slower pace than in May. Airfare and hotel prices dropped, and inflation overall appears to be decreasing in July with gas prices dropping from their June highs.  By the numbers: Housing costs were a large contributor to the increase in inflation, rising 5.5% higher than last year and 0.7% since May. This is the fastest that housing costs had risen since 1990.  What they're saying: According to Inman, it’s going to get worse before it gets better. Housing (purchases as well as rents) inflation usually lags all other inflation by six to 12 months. Rapid rises in rents is only now starting to hit the inflation numbers, and the market could actually go into a negative feedback loop.  This means the Fed’s rate-raising attempts to cool inflation could instead increase housing inflation as more sellers pull listings from the market, scared to leave a home at a lower rate than a replacement they could buy. Further, home builders are feeling the pinch of higher rates on their buyers and their own acquisition and development lines of credit, causing them to pull back on building new inventory.  The bottom line: All of this exacerbates the housing shortage as demand continues to climb, simply pushing up home prices and rents rather than lowering them.

2. 2021’s Top 10 Orlando investor buyers The Orlando Sentinel recently reported that the top 10 home buying firms in Central Florida were tied to firms in the single-family home rental business. Institutional investors have at least partially contributed to the shortage of homes for sale as they snap up single-family homes and rent them to tenants instead.  Go deeper: We’ve written about this before, but the Sentinel’s in-depth research and review of public records puts a name to the companies responsible for the widespread purchases. In particular, they discovered that one company — Progress Residential, a subsidiary of Arizona-based private equity firm Pretium Partners — purchased 740 properties in one year alone.  The rest of the top 10 is a Who’s Who of private equity hedge funds and Wall Street big wigs: Main Street Renewal, Invitation Homes, FirstKey Homes, My Community Homes, Beacon Ridge Capital, and Tricon Residential By the numbers: These 10 bought 3,496 homes or 12% of all the sales that year. Many of the purchases were from Zillow which decided to exit the home-buyer model last Fall. Zillow sold many of the homes in bulk to these top 10 institutional investors.  State of play: Many of these companies rose from the ashes of the Great Recession as they bought up swaths of REO properties from lenders that had ended up with the houses out of foreclosures. Since then, they’ve all continued to grow at a fast clip each year, expanding their market share between 27 and 60 percent a year. Our thought bubble: When we first saw these institutional investors come into the market after the financial collapse of the mid-2000s, we expected that they would buckle under the weight of holding so many single-family rentals. That doesn’t look likely at all now.

3. All the news …. Adjustable Rate Mortgages, with lower initial rates, are making a comeback as fixed rates rise. Marketwatch “Title theft” protection is a crock of …. UExpress HUD charges Polk County RV park owner with discrimination against transgender tenant. HUD Press Release Buyers are canceling at the highest rate since the start of COVID. (We can attest.). Inman via LinkedIN There are still places where $72K a year will buy a lot of home. But none of the top 10 are in Florida. REALTOR Online Real Estate Wenston DeSue is a realtor, organizational consultant, design, construct, build expert and developmental networker.  Real estate is the business of exchange and affects every person on the planet.  Real estate on all levels represents resources, access and ultimately, power.  Knowledge is power…

Florida Home Prices Drop…

 More Sellers Drop Price as Market Cools

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NEWS & MEDIA

Lusky, DigitalVision, Getty Images

JULY 14, 2022

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More Sellers Drop Price as Market Cools

By Kerry Smith

In No. 1 Boise, Idaho, 2 out of 3 sellers (61.5%) dropped their asking price in June. In No. 9 Tampa, a Redfin study found 44.5% of sellers lowered their price.

SEATTLE – Home sellers' expectations often lag reality when the real estate market starts to slow down, and those over-exuberant expectations often show up in the number of sellers who lower the price of their listing.

According to a study of June home listings by Redfin, the number of sellers lowering their asking price spiked notably higher in June 2022 compared to June 2021. In the eight Florida metros included in Redfin’s study, the range ran from 44.5% of Tampa sellers down to 19.8% of Miami sellers.

June 2022 Florida home-sale price drops by percent of sellers

• Tampa: 44.5% (28.6% in June 2021)
• Cape Coral: 41.2% (21.5% in 2021)
• Jacksonville: 40.1% (15% in 2021)
• Lakeland: 36.8% (19.1% in 2021)
• Orlando: 34.7% (25.1% in 2021)
• West Palm Beach: 26.3% (11.4% in 2021)
• Fort Lauderdale: 20.9% (11.4% in 2021)
• Miami: 19.8% (9.7% in 2021)

Boise, Idaho, led the list for percentage of home price cuts, with nearly two-thirds (61.5%) of its listings “price reduced” – the highest share of the 97 metros in the analysis. Next came Denver (55.1%) and Salt Lake City (51.6%), followed by Tacoma, Washington (49.5%), Grand Rapids, Michigan (49.3%) and Sacramento (48.7%). Seattle (46.3%), Portland, (45.7%), Tampa, (44.5%) and Indianapolis (44.1%) rounded out the top 10 list.

Boise, Salt Lake City, Sacramento and Tampa were popular during the pandemic with homebuyers moving in from pricey coastal job centers, taking advantage of low mortgage rates and remote work. Their popularity led to heated competition for a limited supply of homes for sale, pushing up prices and making them unaffordable for many buyers.

“Home sellers are contending with a rapidly changing market, especially in places where they’re used to their neighbor’s homes getting multiple offers and selling for more than asking price,” says Redfin Senior Economist Sheharyar Bokhari. “Higher mortgage rates and a potential recession are causing prospective buyers in popular migration destinations to press the pause button, and they’re also having a big impact on workers in big job centers who rely on their stock portfolio for down payments.”

She says sellers are “adjusting their expectations in real time as they realize they may not get the price their neighbor got two months ago. … If demand plateaus in the coming months, price cuts are likely to be less common as sellers realize the market has shifted” and they’ll price their home more realistically from the start.

Cited:  Florida Realtors 

Credit Repair is NOT Illegal…Lying Is!

Credit-Repair Firm Saw Lying as a Business Tool

By Aspen Pflughoeft

Charlotte Sun/Houston Chronicle 

Rose Credit Repair in Texas promised to quickly boost client’s credit scores – and it did so, but by illegal means, including 133 fake police reports.

HOUSTON, Texas – The owner of a credit repair company was arrested after Texas authorities accused her of using fake police reports to fix her clients’ credit in a multimillion-dollar scheme.

Authorities accused Rose Credit Repair in Houston, Texas, of illegally fixing people’s credit after investigators uncovered a $3.3 million credit scheme “on multiple financial institutions,” the Harris County Precinct 4 Constable’s Office said in a July 10 news release.

Authorities said they conducted a search warrant at the company’s office and arrested its owner, Roekeicha Brisby, 29, on July 7.

The credit repair company advertised itself as using legal means to fix common credit errors, Constable Mark Herman said in a news conference recorded by KHOU 11. Click2Houston reported that the company said it could raise clients’ “credit score by 50-100 points” with results “in 35 days or less.”

According to Herman, the owner of the company used illegal means, manipulating and faking 133 police reports to get clients’ debts erased.

“She submitted police reports on these folks’ behalf saying that the monies that were spent were fraud or stolen,” Herman said. “And many of these financial institutions basically reversed the credit for these people. And it, it did make their credit scores, you know, better.”

Herman also said the fake reports claimed to come from his office.

Brisby was charged with forgery of financial instruments and fraudulent use and possession of identifying information, over 50 items, officials said.

Real Estate

Wenston DeSue is a realtor, organizational consultant, design, construct, build expert and developmental networker.  Real estate is the business of exchange and affects every person on the planet.  Real estate on all levels represents resources, access and ultimately, power.  Knowledge is power…

Florida’s Rental Position…YIkEs!

 NEWS & MEDIA

SeventyFour, iStock, Getty Images

JULY 11, 2022

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Here’s Where Florida’s Rental Markets Rank

By Dave Berman-Gainesville Sun

Miami charges the seventh-highest average rent in the nation and is No. 1 in Fla. at $2,846. Jacksonville is Fla.’s least expensive with rent averaging $1,748.

Gainesville, Fla. – These are the highest and lowest rental housing markets across the nation, based on average monthly rent, from among 107 metropolitan areas studied.

We’ve also included a list of Florida metro areas’ rankings. Data is from the Waller, Weeks and Johnson Rental Index, an ongoing project co-produced by the Florida Atlantic University Real Estate Initiative, Florida Gulf Coast University’s Lucas Institute for Real Estate Development & Finance, and the Alabama Center for Real Estate at the University of Alabama.

10 areas in the U.S. with highest rent

1. San Jose, California: $3,199

2. San Francisco: $3,157

3. Ventura, California: $3,014

4. New York: $3,004

5. San Diego: $2,946

6. Los Angeles, Long Beach, Anaheim: $2,864

7. Miami, Fort Lauderdale: $2,846

8. Boston: $2,762

9. (tie) Honolulu: $2,584

9. (tie) Riverside, California: $2,584

10 areas in the U.S. with lowest rent

1. Youngstown, Ohio: $853

2. Wichita, Kansas: $937

3. McAllen, Texas: $1,051

4. Little Rock, Arkansas: $1,059

5. Des Moines, Iowa: $1,152

6. Akron, Ohio: $1,162

7. Toledo, Ohio: $1,175

8. Omaha, Nebraska: $1,193

9. Dayton, Ohio: $1,206

10. Scranton, Pennsylvania: $1,207

U.S. ranks for 10 Florida areas

(National rank / monthly rent)

7. Miami-Fort Lauderdale-West Palm Beach: $2,846

13. North Port-Sarasota-Bradenton: $2,331

14. Port St. Lucie: $2,266

19. Fort Myers: $2,073

20. Tampa: $2,055

21. Orlando: $1,999

29. Melbourne: $1,881

35. Lakeland: $1,808

39. Daytona Beach: $1,788

44. Jacksonville: $1,748

Year-over-year rent increase for 10 Florida areas

(National rank / year-over-year change)

1. Fort Myers: +32.38%

2. Miami-Fort Lauderdale-West Palm Beach: +31.70%

3. North Port-Sarasota-Bradenton: +30.88%

5. Tampa: +26.93%

6. Port St. Lucie: +25.54%

8. Lakeland: +23.92%

9. Orlando: +23.70%

10. Melbourne: +22.46%

11. Daytona Beach: +21.88%

15. Jacksonville: +20.39%

Real Estate

Wenston DeSue is a realtor, organizational consultant, design, construct, build expert and developmental networker.  Real estate is the business of exchange and affects every person on the planet.  Real estate on all levels represents resources, access and ultimately, power.  Knowledge is power…

Renters To Homeownership by Freddie Mac

 NEWS & MEDIA

Georgijevic / Getty Images

JULY 8, 2022

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Good Renters May Qualify for Mortgages Sunday

By Jeff Lazerson-Pasedena Star

On July 10, renters who pay on time can get a home-buying boost even if they have thin credit scores – a big benefit for first-time buyers in underserved communities.

PASADENA, Calif. – For years, many renters have struggled to qualify for a loan, simply because their credit files did not have enough established credit. Now, that’s about to change, creating homeownership opportunities for millions of first-time homebuyers – especially in underserved communities.

Starting on Sunday, July 10, Freddie Mac will consider on-time rent payments as part of its Loan Product Advisor (LPA) automated loan decisioning system, the mortgage giant has announced.

Giving weight to on-time rent payments in the automated mortgage underwriting gears is brand spanking new.

“It’s a fairly big deal because rent payments aren’t credited by the credit agencies,” said Guy Cecala, CEO and publisher of Inside Mortgage Finance. “It’s a huge hole in the credit scoring system.”

First-time buyers with little or no credit often paid sky-high rent, then were coached by mortgage loan originators to borrow, then pay off, consumer loans to generate acceptable FICO scores. It’s a little insane to take on debt to game the system.

Previously, borrowers needed a minimum middle FICO score of 620 in automated underwriting to qualify for a conventional Freddie Mac or Fannie Mae loan.

“We’re all excited about the possibility of expanding first-time buyer homeownership,” said Brad Seibel, head of mortgage at Sage. “It will probably have a much-needed boost for underserved communities.”

In a nutshell, here’s how it works

First, applicants must be first-time buyers with a 12-month rent history. With the borrower’s permission, a mortgage broker or mortgage lender submits the borrower’s bank account data to the LPA to identify 12 months of on-time rent payments to determine eligibility.

The bank data is obtained from designated third-party service providers using the same automated process used to verify assets, income and employment.

Housing demand and inflation have resulted in many tenants getting rent hikes. The rent payment amounts made do not have to be the same for the past 12 months, so long as they were paid on time.

Eligible rent payment data include checks, electronic transactions or digital payments made through Zelle, Venmo or PayPal.

Using a third-party vendor to pull account statements directly from banks helps lenders avoid the risk of getting doctored documents, another industry executive, said.

If you are unbanked and you pay your landlord in cash or pay with a money order, Freddie Mac allows lenders to manually underwrite loan files through a verification of rent, or VOR, with the landlord. Whether you can find a mortgage lender to manually underwrite is another question.

Real Estate

Wenston DeSue is a realtor, organizational consultant, design, construct, build expert and developmental networker.  Real estate is the business of exchange and affects every person on the planet.  Real estate on all levels represents resources, access and ultimately, power.  Knowledge is power…

US Workers Want Hybrid…

 

From our Thought Leader Partner, MRI.

This report was originally published on MRI Software’s blog.

Survey insights from over 1,000 employees across the United States…

Real Estate

Wenston DeSue is a realtor, organizational consultant, design, construct, build expert and developmental networker.  Real estate is the business of exchange and affects every person on the planet.  Real estate on all levels represents resources, access and ultimately, power.  Knowledge is power…

Working remotely and working on-site both have their benefits:

Working from home means less time spent commuting, reduced physical proximity to other people (a huge benefit in the current climate), and for some, a more focused, productive work environment.

Working on-site is most attractive for collaboration, meeting workers’ social needs and for having more meaningful, face-to-face interactions with mentors or managers.

A hybrid workforce arrangement allows workers to design a more flexible schedule that offers the best of both worlds. Many people find that too much time spent working remotely can negatively impact work relationships, while a significant portion of those working on-site full-time are concerned about pandemic safety (29% of those working on-site full-time reported that they do not feel comfortable with the protective measures at work).