Flying off the shelf

A welcome sign this spring is the rental market is picking up. Our rental business has been busier than ever. We are having a hard time having enough listings for everyone. Our Savin Hill listings have rented quickest followed by Fields Corner/Melville Park. We are about to list a bunch of new listings and they should go quickly as well.

While this is true for our prime locations. There are other areas that are still harder to rent. A good measure of rentability in Dorchester is distance from the Redline or Mattapan Trolley. The further away, the harder to rent.

Tenants: One thing to keep in mind when requesting a showing is to show up on time. At the very least, call to let us know you are running late. Usually if we don't hear from you after waiting 15 minutes, we move on to our next appointment. So please call and let us know what is going on. The other item is credit. Bad credit hurts your chance at the best apartments. Get a copy of your credit report and make sure it is accurate before you put in that application.

Landlords: Promised repairs mean nothing to renters. If your hallway, roof, back decks, etc... need repair, most renters are not going to wait or agree to live through a renovation. Don't be surprised if renters are turned off by unfinished work or needed repairs. Fix it first, then the renters will come. Also, right now most of our renters are looking for fully applianced units (fridge!), gas heat and laundry in the building.

It's Spring

The spring market has sprung! This week in 02124, 02122, and 02125 19 condos have gone under agreement. 5 of those have sold after less that 7 days on the market.

Some notables:
14 Wilbur St #2 UAG
60 Sagamore #1 UAG (only 1 day on market!)
312A Savin Hill Units 1&2 UAG
And it appears that the bidding war/multiple bid has not completely died, several of our buyers have had to play that game this week.

So, while this is great news for sellers, it comes with some pretty big caveats. The properties that sold quick were in A+ areas and were priced correctly. I see a pattern here, I think price may be important (see sarcasm).

New programs in the works

Today the state announced it is trying to stabilize the housing market by giving buyers $20,000 to $40,000 to renovate foreclosures. The program will be available to buyers through Mass Housing and is limited to communities hardest hit by the foreclosure crisis and buyers who will be owner-occupying. The full details are still coming out and we will try to update as we know more.

Time is running out

Did you know that boston residents that owner occupy their home can apply for a residential tax exemption? It is a huge savings but the window to apply is limited, ending March 31st. Visit this website to get the full details.

Help for Boston Residents

The city of Boston is offering an incentive for current residents to set down roots and buy a home in Boston. I have had one client utilize this program and the program covered all of their closing costs. As with many municipal/public programs, there are some hoops to jump though, but it can certainly be worth it covering up to 3% of the purchase price. Click here to visit the program's website.

No Time to Ski!

So traditionally, the winter is a slow time for real estate, but not this year. We have had a pretty busy winter so far. Just listed 14 Wilbur Street units 1,2 and 3 have flown off the shelf with only unit #2 left. What does this tell me? We've got serious buyers taking advantage of great interest rates and jumping on prime properties. Now, this by no means indicates a real estate recovery back to 2005, but it does say that people still want a place to live and are willing to jump on attractive, well-priced units. In fact, I have seen quite a few properties go under agreement and it looks like entry price point for condos is hovering around $200-$250k for market units (not foreclosures). A year ago there were 312 condos on the market in Dorchester, 6 months ago there were 272 and today there are 188. Clearly we are headed towards a more balanced market. The big factor affecting a recovery right now as I see it is employment. If people can keep their jobs and their homes, prices may actually level out. We'll see!

All in a night's work

Check out Justin going above and beyond by grinding off a frozen lockbox so we could get in an make sure all the smoke detectors were up and running in one of our client's listings. Does your agent do this for you? They should and it is just one example of how we do more.

Woohoo 100 posts!

I just noticed that we have completed 100 posts on our blog. Now that is over the course of a year and averages about 2 per week. Not too bad, I often see real estate blogs that got off to a great start and slow down and die. Its not for lack of something to say or that the person is lazy. Its just that as commissioned sales people, we tend to focus on the things that earn us money quickly. So far this blog has earned zero; at least from my perspective. No one has mentioned the blog when they call or email, so I can only go by what I know. But I enjoy having a voice here and hopefully spreading news that is relevant to our business makes your day more interesting.

So for post 101. You are not alone in this foreclosure/short sale mess. The Boston Globe is reporting that the John Hancock Tower is in default with two of it's lenders. Hold on kids, its going to be a wild ride. See the article here.

Keeping our contractors busy

It appears that the construction trades will have a new project to work on and the elderly will have some more housing options. The Boston Business Journal reports that the Nuestra Comunidad Development Corp. has just received $5.3M to develop a parcel on the corner of Blue Hill Ave and Quincy Street in to affordable housing units for the elderly. The project is still awaiting approval from the city and will consist of 40 units and 5,000 sq ft of commercial space.

WHAT IS HOPE FOR HOMEOWNERS? (from FHA’s Website)

When the subprime mortgage crisis reached its peak in the fall of 2008, the federal government took steps to help stabilize the American housing market. The Emergency Economic Stabilization Act of 2008 was signed into law on October 3, 2008. Part of that new law includes a requirement to help qualified homeowners avoid foreclosure through federal loan guarantees and credit enhancements.

The HOPE for Homeowners act is designed to prevent qualified home owners from defaulting on their loans, and avert foreclosure. This is done through refinancing into affordable, fixed-rate mortgages.

If you are in danger of defaulting on your home loan, it's very important to contact your lender immediately and request an evaluation of your situation. If you are able to qualify, your loan officer can help you begin the paperwork to prevent foreclosure. If you are already in discussions with the bank, your loan officer may suggest HOPE for Homeowners as a way to proceed.

AM I ELIGIBLE?
Homeowners may be eligible for HOPE for Homeowners program if they meet the following criteria as specified in the HOPE for Homeowners act 2008:

• The original mortgage is dated on or before January 1, 2008
  
• The homeowner did not default on the original loan intentionally
  
• The homeowner is not invested in multiple home loans
  
• All information on the original mortgage is true (including income sources and job details)
  
• The homeowner has not been convicted of fraud
  

HOPE for Homeowners is not a simple refinancing program. While it does allow qualified borrowers who are stuck in variable-rate mortgages to refinance into affordable, fixed-rate mortgages, there is a trade-off known as equity sharing.

WHAT IS EQUITY SHARING?
Those who apply and are accepted for the HOPE program must agree to an equity sharing program. Equity is the difference between the amount of your original loan and the actual value of the home; if you sell or refinance your home after entering the HOPE program, under the terms of HOPE you are required to share any equity with the FHA. How much the government receives depends on how long you wait to sell or refinance. If you sell in the first year of your participation in HOPE, the government receives 100% of the equity. There is a sliding scale after the first year;

• Year two—homeowners can keep 10% of the equity, FHA gets 90%
  
• Year three—homeowners keep 20%, FHA gets 80%
  
• Year four—homeowners keep 30%, FHA gets 70%
  
• Year five—homeowners keep 40%, FHA gets 60%
  

After year five, homeowners split the equity from sale or refinancing 50/50 with the Federal Housing Administration. If there is no equity or negative equity at the time of sale or refinancing, the FHA receives nothing.

WHAT ARE THE BENEFITS OF HOPE?
The benefits of participating in HOPE for Homeowners include;

• Keeping your home
  
• Getting a 30-year fixed-rate mortgage (extendable to 40 years in some cases)
  
• Lower monthly mortgage payments which do not change
  

The 30-year loan is extendable in some situations. Extending the terms to 40 years is helpful in cases where the homeowner has a large amount of debt; the 40-year term reduces mortgage payments further. There are requirements and restrictions on these extended loans. Check with your lender to see if you qualify for the 40-year loan terms under the HOPE program.

The HOPE for Homeowners program runs until September 20, 2011

Small tid-bit

Every day I receive a newsletter containing real estate industry news. In this morning's newsletter there was an article about foreclosures, how agents can help those being foreclosed on and some tips for those in foreclosure. Most of it was sales pitchy and same-old, same-old.

But I did learn something. Buried in the end of the article there was a mention that many foreclosures are happening illegally because mortgage documents often have errors or looked-over provisions that the lender missed. Especially if the loan has changed hands several times and the servicing company has not kept up on it. The article suggests that one should contact an attorney that specializes in consumer law (but not a real estate attorney). The attorney may be able to find something in the document that the lender overlooked. And that may give a homeowner some time to sort it out with the lender before losing their home.

Market Snapshot

Here is a quick peak at the market. This represents all Multi-family properties sold within the past 90 days in Dorchester.

Price Range	# ofListings	Avg. Days on Market	Avg. Sale Price	Avg. List Price	Sale:List Ratio	Avg. Orig Price	Sale:Orig Ratio
$0 - $49,999	0	0	$0	$0	0	$0	0
$50,000 - $99,999	3	46	$86,333	$105,900	96	$127,567	85
$100,000 - $149,999	6	277	$138,108	$157,008	89	$228,750	66
$150,000 - $199,999	17	165	$165,891	$173,847	96	$245,763	76
$200,000 - $249,999	15	72	$229,046	$235,033	99	$255,013	93
$250,000 - $299,999	16	95	$265,709	$275,119	98	$310,419	90
$300,000 - $349,999	15	121	$313,433	$336,613	94	$359,313	90
$350,000 - $399,999	1	163	$380,000	$399,900	95	$429,900	88
$400,000 - $449,999	1	35	$445,000	$449,000	99	$469,000	95
$450,000 - $499,999	0	0	$0	$0	0	$0	0
$500,000 - $599,999	1	38	$500,000	$525,000	95	$525,000	95
$600,000 - $699,999	0	0	$0	$0	0	$0	0
$700,000 - $799,999	0	0	$0	$0	0	$0	0
$800,000 - $899,999	0	0	$0	$0	0	$0	0
$900,000 - $999,999	0	0	$0	$0	0	$0	0
$1,000,000 - $1,499,999	0	0	$0	$0	0	$0	0
$1,500,000 - $1,999,999	0	0	$0	$0	0	$0	0
$2,000,000 - $2,499,999	0	0	$0	$0	0	$0	0
$2,500,000 - $2,999,999	0	0	$0	$0	0	$0	0
$3,000,000 - $3,999,999	0	0	$0	$0	0	$0	0
$4,000,000 - $4,999,999	0	0	$0	$0	0	$0	0
$5,000,000 - $9,999,999	0	0	$0	$0	0	$0	0
$10,000,000 - $99,999,999	0	0	$0	$0	0	$0	0
Total Properties	75	Avg. 123	$234,951	$247,542	96	$287,182	86
Lowest Price: $75,000
Highest Price: $500,000
Median Price: $245,000
Average Price: $234,951
Total Market Volume: $17,621,345

Happy New Year!

Whew! 2008 was quite a year here are some of my predictions for 2009.

• Historically low mortgage rates will be available for certain borrowers in Q1
• Mortgage rates will increase as the year progresses getting close to 7%
• Foreclosure inventory will dwindle
• Prices will start to bottom out but certainly not increase.
• The rift between prices of REO and non-REO condos will continue. SF and MF prices will have less disparity between REO and non-REO.
• Location and condition will become more and more important factors in price.
• Rents will decline/remain flat as more rental units come into the market as foreclosed properties are renovated and condo owners decide to rent vs sell.
• Renters will dictate the fee structure and will demand a no-fee rental inventory.
• Foreclosures will continue but will slow down, not because of lack of properties but rather legal wranglings and procedures, bank mergers and forced borrower work-outs that will ultimately fail but in the meantime delay the inevitable.
• Short sales will become easier as lenders focus on this low-cost alternative to foreclosure.
• Local lenders will become the power players in the mortgage market, mortgage brokers will have a tough time competing against direct lenders.

Some of these are no-brainers some are certainly a hunch. Let's see in 2010 how we did.

Our Big Data Project

I have mentioned here and there that I am working on a huge data analysis for Dorchester property sales through MLS. I finished the condo segment and am moving on to multi-families. I decided to do something really cool with the condo data and import it into mapping software. This is just a jpeg of the overall map, but in the software I can zoom in and see the address, sale date and sale price. Wicked cool if I do say so myself. It's interesting to see where the bulk of the condo sales are. Maybe in a next post I will break it down by year and give a snapshot for each year. Stay tuned.

Nice Touch

I had a closing yesterday and it was fairly routine (except the fact that it was a foreclosure and took a month longer than it should've). But the closing attorney was great. Aside from being a great attorney, he spoke Spanish and Portuguese. This enabled him to go over very important documents in my client's native tongue. Really a life saver because unless you are familiar with these documents it can sometimes be tough for a family member or friend to translate. All in all it was an excellent transaction and the family is very happy, thanks to some special people that made it happen and helped with the translations. I would have been lost without Ted Silva (the attorney who spoke Portuguese) and the daughter-in-law of the buyer. Thanks guys!

A nice touch from the attorney, he took a picture of everyone at the closing. I will definitely start doing that at my closings. For many it is a very special occasion and I think it will be nice to have a photo of it.

Cheers!

Some notes about the news.

There are quite a few people out there following the market and relying on the Case-Schiller Home Price Index, as reported by every major news outlet. What we need to be mindful of is that it only tracks single-family homes. So it is a poor reflection of many urban areas where the bulk of the properties and transactions are condos, such as the South End.
We are currently working on getting the year end sales stats so I should have some good data soon.

Let me know what neighborhoods you would like some sales stats on and I'll get on it.

Schools

We have had several inquiries lately into what public schools apply to which properties. In most suburbs, this is an easy task. But in Boston there is a whole process and no child is guaranteed a particular school, but rather they are guaranteed a seat within their school zone. For the definitive answer to schools, visit the Boston Public Schools Student Assignment Policy by clicking here.

Rainbows over Savin Hill Ave

I hope the pot'o gold is nearby....

Beware on Craigslist

It appears that the Craiglist scammers have choosen one of our properties to use in their plot to extort money from unsuspecting renters. Please note that all of our rentals require a RHA Rental Application along with a form permitting us to check your credit, employement and landlord history. Without those items being complete, returned to us and presented to a landlord, we will not execute a lease. Anyone on Craigslist promising to rent out an apartment without having you fill out those forms is not acting on our behalf. If you have any questions about any of our rentals, please call us at 617-265-3500. Also, please call us and let us know what listings are being misrepresented so we can have them removed and reported to Craigslist's management.
Thanks!

Looking forward to the winter

I am sure that most of you have been reading the headlines and seeing that foreclosures are up and prices are down. I am asked quite frequently if that is hurting business. And it is definitely slowing down the arms-legnth transaction of undistressed sales. But, we are busier than we were last year with most of our transactions being foreclosures or short sales. We are receiving quite a bit of interest in multi-families under $200k. Condos are selling under $100k in some areas and every now and then a great single family comes up.

There is some discussion about whether or not it is a good time to buy. Only you can make that decision for yourself. Right now quite a few investors are contacting us and looking to purchase a deal. Rents are inline with prices, it's just gotten to the point where the rents will actually cover the expenses.

I think prices may still decrease in some areas and it will be impossible to call the bottom until we are on the way back up. As always hindsight is 20/20. Do what is right for your individual situation, speak with an agent who is intimate with the market you want to be in and make sure your financial house is in order.

I think there are some great deals out there and several of us in the office have personally purchased property this past year. There are some buyers however, that should not buy right now, as the market is not very forgiving at this point.

And I guess that is the difference between now and a few years ago. There are bad deals now and there were bad deals then, but the difference is how forgiving or not the market is.