Upside of a Down Market -- Cleaning REO/Foreclosed Houses

It's not ALL doom and gloom out there! Here's how to make lemonade from the vast quantities of lemons out there!

From Bust to Broom: Foreclosure cleanups bustling - Yahoo! Finance

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Get More Clients Than You Can Handle!

OK, I have to share this one...

Recently, on one of the forums I frequent, I saw a post about this ebook. While I don't often buy books sight unseen, I thought this one was just too cheap and the potential too vast to pass up.

While the title, Offline Goldmine, is kinda cheesy, it is packed with good information about building a business. The author is very matter of fact, very practical, and very down to earth. Here's a snippet:

Here's your first big secret to consulting. You must resolve yourself to the understanding that your main function is to actually help people. Sure, the money is great but it won't last long unless you adapt the "I'm here to help" rule.

To me, that is as golden as rules get.

But David Preston, the author, doesn't stop there. He offers page after page of very cogent advice. I highly recommend this book.

I should add, this being a blog about real estate and all, that while the book focuses on applying online marketing knowledge to an offline consulting practice, THAT'S EXACTLY WHY IT APPLIES TO REAL ESTATE INVESTING!

I wouldn't be surprised if you, as a reader of this blog, know more about marketing online than fully 99% of the people in the real estate world -- including realtors, mortgage lenders, and especially contractors and your every day part-time real estate investors!

Talk about a WIDE OPEN MARKET!

Get it here -- Offline Goldmine

HIGHLY RECOMMENDED!

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Hey, John, Here's Why!

A friend of mine asked the other day, "Why in the WORLD! would I want to use something like Twitter!?"

Well, John, these 8 Reasons To Get on Twitter Today probably don't apply to YOU, but for the mere mortals among us still trying to make our FIRST million in real estate, here's a good summary:

8 Essential Reasons Why You Should Join Twitter for Marketing Your Real Estate Business


For example,

 "Most likely everyone you want to get connected with already is on Twitter. Whether you want to get better connected with your customers, business

partners or network and make new connections, Twitter is the place to do it."

Check it out!

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This Could Be Interesting

Just stumbled across this and thought it might be interesting to follow. A real estate investing "guru" is going to post step-by-step how he will find a motivated seller and buy himself a piece of property:

"I’ve decided for the New Year I want to move. And, I’m going to detail step-by-step everything I do to purchase my new place. So for those of you who still haven’t done a deal, ...I’m going to show you how easy it is."

Follow along with me here:

The Most In-Depth Case Study Ever!


Toodles!

Cass

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Landlords, here is your Section 8 Inspection Checklist

I am looking into purchasing an investment property that would be a strong contender for a Section 8 tenant. I asked some of my investor friends what is required to pass a Section 8 inspection, but mostly what I got was shrugs and blank stares.

So I poked around online, and found it. Here, let me save you the trouble:

      Housing Choice Voucher Program/Section 8

A couple of things jump out at me:

First, one big "DOH!" --  "All three-prong outlets must be wired correctly.  A three-prong circuit tester will be used at the time of the inspection to assure safety."

Yeah, well, since I have one of those, I can check those myself very easily! And if need be, call the electrician back to fix the dang outlets!

Second, "If the unit has a 3rd floor sleeping room(s), & the family is eligible to use this room for sleeping; the owner must provide a safe method of escape in the case of fire.  For example: Chain ladder."

MUCH cheaper to provide a chain ladder, stowed near the window, than pay an extra month's carrying costs waiting for a re-inspection!

Third, "The owner must provide "refusal disposal".  These facilities include trashcans with covers, garbage chutes, dumpsters with lids, and trash bags if they are the types approved by the local Health and Sanitation Department."

I'm not sure how one literally disposes of refusals, but if I can avoid a refusal by buying a $20 trash can, I'm happy to do so. Again, much cheaper than even one extra mortgage payment.

Gotta love the google!

Cheers,

Cass

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Househunters take note!

Gotta love that Sun Wonk. She is prolific! In Sunday's paper I noticed her piece on homesearch web sites. Very good as far as it goes. Check it out here:

'Net assets -- baltimoresun.com

The only problem is she covered only Multiple Listing Service (MLS) sites. IOW, no for sale by owner... no investors wholesale deals...no outside the box thinking.

So here's my epilog:

www.fsbo.com
FSBO = "For Sale By Owner"
(pronounced "fizz-bo")
Found another 30 listings not uncovered by the Wonk. Admittedly the search engine is not as fine tuned...this is within a 50 mile radius of Hampden!

www.forsalebyowner.com
Found another 128 listings, possibly some overlap, but hey, I'm not going to look at every single one!

www.homesbyowner.com
Kinda lame, really, only produced one listing (3 br, 2 bath) in Baltimore, period. But still possibly a valuable resource if checked regularly.

baltimore.craigslist.org
Craig's List is definitely hit-or-miss, but every active investor I know posts their properties for sale here. Check it daily, and call the sellers asap if you're serious. Even if the house you find isn't perfect, the seller may have others coming soon. Or they may know about others coming soon.

Google Alerts
The true beauty of the web is that it's run by computers! Search smarter, not harder! Set up an automated search that will email you whenever a new home is added, or a new web site is setup, or a new blog post talks about your neighborhood of choice. The possibilities are endless. Try some different searches from Google's homepage until you are getting the types of results you want. Then create alerts with the search term(s) you like, and set them to email you once daily or in real time, as you prefer.

Happy hunting!

Cass

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The book that changed my life!

If you know me, you know I am a big Timothy Ferris fan, and just love his book The Four Hour Work Week. This book literally changed my life, and is a must read. Especially for anyone interested in real estate investing! Go get it now using the link below, and help me fun this blog! (I get about a dime for every order, so order several to give to your friends!)

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Tracking down a property owner

Thanks, Wonk, for your brief tutorial on how to find a property owner. A highlight:

Once you find documents associated with your mystery owner, read through to see who signed them. "I Own This House LLC" can hold property, but it can't put its John Hancock on the dotted line -- that's where an actual human being is necessary. When I checked the deed showing Tribune as the new owner of The Sun's building, I did indeed see a human name and signature associated with the LLC that had owned it before.

Here's another useful tidbit I recently discovered on my own. I was wondering if anyone kept a list of all vacant houses. While I still haven't found anything like a "master list," I learned a back door way to find portions of it. It seems that the city's housing department posts code violations on its web site in real time. That's what they told me, real time.

So an inspector finds a house in violation of some code, enters the violation on a portable device (laptop? other?), and viola, said violation appears on the web site, baltimorehousing.org. To reverse the process, and find said violators, visit the website and click "Housing Code Enforcement." On this page you will see the link "See all active code violations for your neighborhood."

That will take you to this page: Search - Violation Notice

If you know the address, type it in. If you want to check out a whole neighborhood, do that. You'll get a page that look like this:

Note the column headers are clickable for sorting purposes..

Even cooler, if you click the map icon in the far right column, it takes you to, you guessed it, a city street map showing the subject house in its neighborhood.

But coolest of all, click the address on the map and you can jump straight to its property tax record. Viola!

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Bloggers Wanted

The Maryland Real Estate Page is looking for a few good writers.

Anyone reading this can see I haven't been able to post every day. That is my dream, and while I go on a roll once in a while, I also seem to let days go by more often than not.

If you know someone who wants to write about real estate in Maryland, whether from the perspective of an investor, a home owner, even a renter on the outside looking in, send me an email with a short explanation of how you can help.

Talk soon!

Cass

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Auction Time!

Went to my first auction today. FINALLY found time to go do it. Three foreclosures in Baltimore County, auctioned on the courthouse steps in Towson.

Very enlightening.

First, it struck me there were only three of us there, besides the auctioneer and the bank rep.  Maybe it was the weather. It's hot and humid today.  And everybody knew everybody else. They knew I was a newbie, and asked me as much, and I owned up to it. No shame in that.

Second, and of course I don't know if this is common or not, but nobody bid anything. All three auctions started with opening bids from the bank that I thought were high, and so did the other two guys. One house had a deposit requirement of $25,000. I've learned that you usually multiply by 10 to get an estimate of the amount owed on the mortgage. That would mean they want to get about $250K for the house. Sounded like there might be a real deal there, since the house sold less than three years ago for $907K.

I had looked up the current mortgage, and I could be wrong, but I only found one mortgage, for $531K, dated December, 2005. So after 2 and a half years, the outstanding balance might be in the $500K range. But the opening bid was $995K! One bidder left in a huff when he heard that number!

Finally, I was amused at how lassaiz-fair everyone was about the whole thing. People are losing their homes, and these guys are yucking it up...craziness...

Cass

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Live Blogging from Vegas, Baby!

OK, I am halfway through Fortune Builders' 5-day bootcamp on real estate investment marketing and wholesaling. I cannot recommend it more highly!

It's like drinking from a firehose! Nothing but content! I've been to a lot of seminars where they spend a lot of time trying to sell you more seminars. Not so here!


Whoops! Gotta go, time to pay attention again!

More soon...

Cass

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Scared yet?

Stumbled upon this gem over at "REIFR". Money quote:

Yet, in this market there are good investment choices, because of the
risk. Those who pull the trigger and guesstimate correctly will be
rewarded handsomely, but many might lose. If there was no loss,
everyone would invest.

Full story here:
Oh, Those Scary Unknowns in Real Estate Investing | Real Estate Investing for Real Blog


Cass

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Is it the real deal?

Got an email today claiming:

There's a new Real Estate Investing Club in Baltimore called The Real Deal.   Finally, a FREE real estate club that truly wants to educate, share and spread the power of real estate investing, without any BS. That's right no courses, seminars, or tapes, to sell, just the facts about real estate investing, no general information.  If you can handle the truth about real estate investing then you will want to be a part of The Real Deal

A quick check of their web site (a group page on meetup.com, which is a great way to get going cheap!) reveals they started in March and have met twice so far. I recognize the names of a couple of their members, but not the principals. Any feedback on the group, the meetings, or the people behind it would be appreciated.

I'm out of town on the 28th of the month, when their next meeting will be held. Someone go and get back to me, K?

Real Estate Investing / The Real Deal (Baltimore, MD) - Meetup.com

Cass

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Investors -- know your 1031 Exchange rules

This just in from my title insurance underwriter's newsletter:

Section 1031 of the Internal Revenue Code ... is extremely beneficial to investors because it allows them to reinvest all their net equity into another investment property without paying capital gain taxes.

However, ... there are many ways an investor can get tripped up in the tangles of complicated
IRS rules and regulations and the tax code requirements of a 1031 exchange.

Know the pitfalls! Read it here:

Pitfalls to Avoid
in 1031 Exchanges

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The Real Estate Wonk on Foreclosures

Jamie Smith Hopkins, over at The Sun, has a piece today on finding foreclosures. Great as far as it goes, and you should bookmark all the links she includes, if you haven't already.

But professional investors, take note: she says nothing about marketing for foreclosures, and the inherent dangers therein. If you are actively marketing for foreclosures, e.g. "We Buy Houses -- Avoid Foreclosure", you may be courting legal trouble if/when you buy a foreclosure.

The Real Estate Wonk: How-to Monday: Finding foreclosures - Baltimore and Maryland real estate market, homes, foreclosures, mortgages - baltimoresun.com

Like she says, avoid the auction, and go right to the REOs. Much safer, IMO.

Cass

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The Real Estate Wonk: Map those trends - Baltimore and Maryland real estate market, homes, foreclosures, mortgages - baltimoresun.com

The Real Estate Wonk: Map those trends - Baltimore and Maryland real estate market, homes, foreclosures, mortgages - baltimoresun.com

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Real Estate Investor Web Site

Spent a little time playing with this site. Since I saw a few people I know on there, I guess I can recommend it here. :)

Actually it's a pretty good compilation of news, in-depth articles, forums and blogs, and all geared to the real estate investor. You can create your own real estate focused blog there. Hey, now there's an idea!

Check it out:

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Who needs title insurance anyway?!

This is not in Maryland, but I love stories like this because they can -- and do -- happen anywhere. Why do you want title insurance? Here's why:

The property was twice mowed by the city while the house was empty, and the assessment was filed against the absentee property owner.The house was later foreclosed on by the bank and transferred to the U.S. Department of Housing and Urban Development. HUD, in turn, sold the house to a Rowlett man named Andy Grubbs, who fixed it up and resold it to Mrs. Gutierrez and her late husband.

Mr. Grubbs admits he did not have a title search made when he purchased the home from HUD, instead relying on the agency’s stated policy of not selling properties unless the titles are “clean” of any liens.

Dude, like, you trust the Gubmint? And you live in Texas?!

The lien, assessed in 1988 for city mowing charges totaling $272.95, has ballooned with interest and penalties to more than $2,000. In 2005, the city began notifying Mrs. Gutierrez that unless the full amount was paid, her home could be subject to foreclosure.

But here's the money quote:

“Title insurance, ever heard of it?” one cranky reader sarcastically asked.

Gotta read the whole thing. Don't worry, it's not long.

Garland woman won't lose home over 20-year-old lien | Dallas Morning News | News for Dallas, Texas | Columnist Jacquielynn Floyd | Dallas-Fort Worth News

Cass

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I'm going to Vegas, Baby!

Yeah, the boss let me have a couple days off. (Thanks, honey!)

Call me a sucker, or call me an educated investor, but don't call me at the end of June because I'm going to FortuneBuilder's Real Estate Marketing and Wholesaling Boot Camp at the Golden Nugget!

I missed the one in Connecticut earlier this year, but I won't be missing this one unless another 9/11 grounds all the planes in the US!

Than Merrill of "Flip This House" fame is the lead instructor, and having heard him speak, I know he's good. When he was here, he told a story about an annual trip he makes to Costa Rica to meet with a bunch of real estate millionaires. They hobnob and compare notes and what he learns there he applies to his business and it always increases his revenues. Nobody gets invited to that retreat unless they've made over $1,000,000 in real estate.

Guess who wants to go to Costa Rica? First stop, Vegas!

Will blog from there with anything at all I can share! Beware! (Sorry, couldn't resist the corny rhyme.)

Cass

PS: I can take a "business partner" for a mere $495, instead of the $3495 list price. Included is all the cool stuff pictured below, and more I'm sure. Airfare and hotel is about $1,000. All's I can say is, make me an offer I can't refuse...  :)

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We're long on short sales

When I first started looking at real estate investing, I had no clue what a short sale was. Now Maryland is on a record setting pace for them. Great article in the BBJ:

Mortgage woes spur short sales.

Just realized it's for subscribers only. Sorry.

But then, you really should subscribe! Call Jerry!

- Cass

Why does every little thing cost $300 to $500?!

So much to do, so much to learn!

I'd really like to buy one of those prefab web sites for real estate investors, but most of the good ones start at $499 and $50/month.

I'd really like to sign up for MAREIA's wholesaling class, but it costs $495 plus another 3 $500 hits after your first deal!

I'd really like to join the GBBR or the Maryland Mortgage Bankers Association, but affiliate
memberships there cost $350 and $600!

Does everybody think we're made out of $100 bills!?

Thank goodness the Thirty Day Challenge is still free! And I recommend it HIGHLY!

Cass

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Where to invest?

Hoping to take advantage of the rash of foreclosures? Itching to position yourself as a landlord, rehabber/flipper, or even developer ahead of the BRAC goldrush? The big question is where to start?

Fort Meade and Aberdeen Proving Grounds are slated for significant growth over the next couple of years. Around Fort Meade you can find plenty of icky houses to buy, but will they suit as rentals or be better for flipping to retail home buyers? What's the best way to navigate the myriad counties' law re zoning and land use laws? Is it better to focus on a geographic area, or a building type?

Aberdeen is surrounded by lots o open space, but is it really ready for the growth? Think of the commute down 95 today, and imagine what it will be like in 3 years. Egads!

And Baltimore City, centrally located, is chock full of shells, partially fixed up neighborhoods, and rent-ready houses that can be got cheap. But will the worker bees be willing to travel every day south to Ft. Meade or north to Aberdeen?

Hmmmmm.

These are the questions running through my mind this June 1, 2008. Comments and discussion are welcome. I'll post answers if/when I ever come up with them...

Cass

Real Estate Investors -- Avoid Jail Time!

Real Estate Investors: Listen up. Especially if you are considering or are actively investing in foreclosures or preforeclosures.

Very informative webinar here. Goes into great detail about how Maryland law has been changed to make this type of investing tricky, if you don't know what you're doing.

Second one coming up soon, if you want to participate (ask questions, get answers.)

Thanks Barbara and Jeff!

Cass

An awesome Real Estate Investment Company business plan

Are you really a real estate investment company if you don't have a business plan? No, it's not essential, but it may help you focus your efforts.

I know, who has time to write one!? Never fear, I just found one online that's free to anyone interested, courtesy of ReferenceforBusines.com. Check it out here.

Toodles.

Green is good

I'm currently learning a lot about building green. It is fascinating to me that we could be living in houses that essentially pay for themselves, so called "Net-Zero Energy" buildings...but we don't. Could it be the vast right-wing conspiracy to keep us all dependent on oil as long as humanly possible? Even to the detriment of the planet we live on?

Check this tidbit, from the NAHB:

When 800 registered voters were asked how important
certain items would be in their decision to either purchase a new green
home or remodel their current home to be more green, nearly two-thirds
(64 percent) of consumers polled said that “reduced energy costs” would
be the most important. The second-highest scoring reason, at 55
percent, was “because it would be healthier.” And 49 percent of those
surveyed say it’s “the right thing to do for the environment.”

And yet, from the BBJ, this:

According to a Calvert report released Tuesday, the nation's leading
home builders have been slow to embrace green building techniques such
as energy efficiency.

What is wrong with us?!

Cheers!

Zillow Mortgage Marketplace

While we're on the topic of mortgages, I heard on the radio that Zillow had added a mortgage quote tool. Cool thing is, unlike most mortgage sites (LendingTree, Ditech), you don't have to identify yourself. You can enter some basic info about yourself and get a quote anonymously. If you like what you get back, you can then provide your contact info. If not, no salesmen will call.

Please give it a try and come back here to comment on its utility.

Cass

With apologies to all my friends in the mortgage business

If you're looking to buy property and take out a mortgage, you must read this great piece by the Wonk on Mortgage Fees. I don't understand why they make them so hard to understand...oh, wait, yes I do. ;)

Cass

Oh, yeah, I have a blog!

Wow, time files...

Been too long since I've felt I had anything interesting to say, or even link to. But I'm feeling verbose again. Stay toond...

Cass

She sells shells, see?

Checking the recent auction results at AJBilling, there have been some major steals lately. $10K, $5K, even $3K for rowhouses in Baltimore city. Even with a full gut rehab and six months of carrying costs, you could be into a rental prop for less than $75K that brings in $1,000 or even $1,200/month. Read that as $400 positive cash flow, possibly better. And some don't even look like full gut jobs.

I don't care who you are, that's a deal. It seems the key is to look for deposits of $5K or less.

I'm going to some auctions, and soon! Anyone want to tag along?

Anyone care to share a story of a recent auction experience? Comment away...

Another cool site

While Zillow is pretty cool, and I like Ziprealty too, my new fave is hotpads.com. I like their rent v buy feature. Most of all I like how you can cut right to the chase and see where the houses are, without all that annoying "create an account" crap. And it zips right along, too. Quite snappy.

Check it out.

All 'Bout Closing - ABC - All 'Bout Closing

I was going to write something like this, but luckily I found this site first, called KnowYourClosing. Great step by step guide to the real estate transaction, from the closing process to title insurance, who is involved and the order stuff happens.

1. It starts when a seller accepts a contract you've put in on their home. You might put down a deposit check to prove you’re serious about the offer. At that point, your settlement agent
(often an attorney, and also sometimes referred to as closing agent,
escrow officer or escrow agent), gets the ball rolling, deposits any
funds you’ve submitted into a special escrow account and puts in requests for title work, or an examination of the home's ownership history.

Highly recommended.

Now that you're a home owner...

I have to give a tip of the hat to Jamie Smith Hopkins, the Sun's Real Estate Wonk, for her comprehensive list of things to think about if you've just bought a home around here. Wish I'd had this when I bought my first home, lo those many years ago.

Things like, oh, license your pets, register to vote, and one I'm sure you've thought of already: "apply for the Homestead Tax Credit, which puts a ceiling on property tax increases once you've been in the property a full fiscal year (meaning July 1 through June 30). If you bought your home this year, you have 180 days to apply."

This came out a couple of weeks ago, and if I hadn't had PC tech issues I would have posted it sooner.

Read it all here.

Internet Bandit Signs

Bandit Signs. Gotta love em. See them everywhere, don't you? Now you're seeing them more and more right here on the ole net. Cases in point:

House Buyer Network
Cash Offers.com
I Buy Houses.net
and of course, WeBuyHouses.com

The list is almost endless. Just google it, you'll see what I mean.

And just as you can buy actual bandit signs online (e.g., at Bandit Signs.com), you can now purchase automated "we buy houses" web sites. Package deal! Your path to real estate millions!

I guess the good news is, they're not illegal like physical bandit signs. (What, you didn't know they were illegal? The term "bandit" didn't give you pause?) But do they work? And are they cost effective?

I tend to think they do and they are. I'm building my own now. Will post a link when it's ready.

In the mean time, if you're interested in one of the package deals, ping me and I'll send you some links.

Dang computters

I really have a love-hate rel'ship with computers. Can't live with 'em, can't shoot 'em. Have finally fixed my laptop so I can resume posting. Sigh...

Mortgage Defaults Reach a New High

Yeah, here's a surprise. From the DC office of the New York Times:

Defaults were highest on adjustable-rate mortgages...

Ya think?

The Subprime Primer

Today's must read: The Subprime Primer. A total hoot, and informative to boot. Wow, I'm rhyming, without even trying!

Apologies to anyone offended by offensive language.

Steve Cook LIVE!

Sorry this is so long in coming. Sometimes life intervenes. Good thing I took notes!

Anywho, the other night Steve Cook and friends from flippinghomes.com did a free, open to the public conference call. The topic was "5 ways to assign non assignable deals." If you don't know who Steve Cook is, you can find lots o info on him via flippinghomes.com.

Steve does personal coaching of other real estate investors. And he started out with a story about a student of his who was worried about the non-assignability clause on an REO property she wanted to wholesale. In case you didn't know, in Maryland, all real estate contracts are assignable unless they specifically say they are not. And virtually all REO contracts are specified non assignable. So this student was stumped. Steve coached her to dwell not on the problem, but on the solution. Good advice in all areas of life, IMHO.

He says he assigns non-assignable deals all the time. Here are 5 ways he does it. I won't bore you with the details, but if you do any wholesaling, this should be enough to stoke your fire.

1) Just do it. Show up at closing with your end buyer. With the funds sitting in escrow, and a buyer at the table, what are they gonna do, nit-pick over contract language? More likely, they'll settle.

2) Have your title company submit an assignment addendum expressly allowing assignment to the seller. This works best if done a day or two before settlement, because they really really really want to sell this property...

3) Add a second buyer to the contract with an addendum. A week or so later use a second addendum to remove the initial buyer. (not sure if the Hud1 shows the assignment fee in this case. Use with caution if expecting your buyer to pay you outside of closing.)

4) Create an entity, sell the entity. (You might want to get your lawyer involved in this one, at least the first time)

5) Double close. The most controversial of all! But he says he does them all the time.

Steve said at the start of the call that he had just thought of a sixth one! Unfortunately, after he got through the five above, he couldn't remember what the sixth one was. Oh well. Maybe next time!

If you want to listen in on the three upcoming calls, go here and get all the info.

Real Estate Investors, Listen Up! Hear Steve Cook for 4 hours for FREE

While I understand that this is a promotion for a real estate investing bootcamp, which ain't cheap (although compared to others out there, it ain't outrageous either!), I have to recommend it for its content. Anything from Steve Cook is going to be valuable to you if you currently invest in real estate, or hope to soon.

I have nothing but respect for Steve Cook. He is a real estate investor and instructor to pay attention to. And he will be leading 4 one-hour teleconference calls, complete with Q&A afterward, starting Monday, Feb 25. I plan to be on the calls, and will report back here what I learned for those of you who miss out.

Go here to learn all about it and register. Again, it's free. And it's Steve Cook. Really, nuff said.

Cass

Good, Fast, Cheap: Pick any Two

As a title agent marketing my services to loan officers and realtors, I often hear that so-and-so title company turns their title work around in a day, or even within a day. My response has always been something like "So what? Are the loan docs going to be ready tomorrow?" Of course not. It takes anywhere from a week to a month to get a loan approved. So what's the big rush for the title work?

Now with off-shoring of abstracting, we have reached the epitome of fast and cheap. But good? You can't have all three.

Thankfully, some quality assurance is coming down the pike. Thanks to the education committee of The National Association of Land Title Examiners and Abstractors (NALTEA), we now have a certification test for abstractors. Check out Robert Franco's review from Source of Title Blog:

Perhaps these results will make the industry realize that abstractor
selection should take into account more than just price and turn-around
time.

Exactly. I urge everyone in this industry to ask if their abstractors carry NCA or NMA designations. I'll take good over fast any day of the week.

Cass

Real Estate Auctions on RSS! Capital idea!

Kudos to A.J. Billig & Co. Auctioneers, for putting out an RSS feed so interested parties can get the scoop on upcoming real estate auctions in "real time." Apparently they just set it up in the last month or so, and from what I can, they're the first. Watch all the other guys jump on the bandwagon soon. Just go their website and look for the link in the lower right with the RSS button.

If you're new to RSS and don't know why or how to use it, I recommend Bloglines. It's a free service, all you need is a web browser. Click on "About" for more info.

Cass

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Stats R Us

Jamie Smith Hopkins from The Sun summarizes data from MRIS as it pertains to Baltimore in "2007 in the rear-view mirror."

Examples:

--Average prices in the Baltimore metro area rose 2.3 percent to about $316,900. That's very close to the preliminary figure.
--Median price (impossible to calculate from the monthly reports) was $273,000, up almost 2 percent.
--Sales fell almost 18 percent, also a minor change.
--Reported average days on market rose from 60 to 92.

Interested in your own area in Maryland? Go to MRIS and run your own report, on the county of your choice. (Virginia and WV in addition to Maryland)

- Cass

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How long is too long?

You knew this was coming. Houses sitting too many days on the market? Change the way "days on market" is determined:

Metropolitan Regional Information Systems,
which manages a database for 60,000 real estate professionals in the
Washington area and parts of West Virginia and Pennsylvania, is
changing an element of its "days on market" listing for homes.

It involves decreasing from 180 to 90 the number of days a property
is required to be off the market before MRIS resets that number to zero
when it gets back on an active listing for "days on market."

Read the whole story here.

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What costs more: Title Insurance, or No Title Insurance?

Seems to be a big topic these days. Reports of consumers being overcharged. Industry annual totals like $16 Billion dollars. Excess Fees. Charging for services not rendered. Kickbacks.

Hmmm. I will be digging into this more. For starters, here's some background:

Perpetuating A Myth from Source of Title blog


More soon.

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Now that's a bummer...

Home Sales Fall A Record 40%

Home sales in the Baltimore metropolitan area opened the year with a record 40 percent nose dive, falling to a new low as price declines swept through most of the region.

Story here, from baltimoresun.com

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Foreclosures, git yer foreclosures here!

I, too, wonder who the hell is doing the foreclosure title work!? Great post from radicaltitletalk.

Just watch who you're dealing with is all.

Cass

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Hey bud, wanna buy a cheap title search?

My new favorite online community is Active Rain
Where people are hashing out the "hot topics" in real estate. For anyone not in real estate, such discussions may seem as exciting as watching paint dry. But for those of us in the trenches, even talk about title work gets our blood boiling!

For example, did you realize our industry is trending toward outsourcing title searches to vendors on the other side of the globe? Yes, as more and more municipalities put all their records online (ah, progress!), the offshoring of title searches and abstracting as an effort to save money (or is that to increase profit?) is gaining traction. But as Lenn Harley, a RE broker covering Maryland and Virginia, points out, this may be a foundation not to be built upon:

The title search is one of the most important transactions involved in
buying a home. It's isn't the place to begin an economy drive. As a
person who has never really been comfortable with poorly written
abstract reports that look like a physicians prescription, how on earth
are we to depend on an abstract performed by an offshore vendor who
cannot go to the office of land records to verify a suspicious entry in
the county computer record[?]. Or, follow the trail of a incomplete
record entry[?].

Film at 11
Local title guru Ed Rybczynski put together a cute little video clip summarizing the comments. Do YOU "get it?"

Cass

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No time like the present!

Even though Chris Schulz is in St. Croix Valley, when he says now's the time to invest in Real Estate, I think he's SPOT ON! Everything he says in his post called "8 Reason to Invest in Real Estate in 2008" applies directly to the market here in Maryland.

Check it out!

Cass

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Is the Sky Falling for Short Sale RE Investors?

Be a fly on the wall, you might hear the F word
Shaun McCloskey and Cory Boatright and friends over at FlippingHomes.com have released to the public a recent "private" (student's only?) con call in which they discuss how the short sale business model for investors is threatened by title insurers who either don't get it -- or don't want to get it. One regional manager of a national title company told Shaun to take his business elsewhere, because what he was doing -- the proverbial "double close" or "simo (simultaneous) close" -- was fraud! But is it?

What's wrong with a double-close?
Fascinating call. As a title insurance producer myself, I listened closely, trying to decide on which side of the fence I should stand. On one hand, if someone is so close to foreclosure that the lender is willing to sell the house short (for less than the amount owed), they should be happy to get it off their hands. The bank should be happy they don't have to go through the foreclosure process, then try to sell the house through normal channels, taking the risk it might sit. The homeowner should be happy they don't get the black smudge of a foreclosure in their credit history. So what's the problem?

The problem is that on the same day Shaun buys the house at a discount from a lender and homeowner who just want out of the deal, he turns around and sells the same house to someone else for significantly more money. The difference is his profit. Buy low, sell high--the American way, right? The potentially fraudulent part? That he does this with back to back closings. If the lender financing the end buyer is working off a different appraisal, for example...that could be trouble.

Caveat Emptor, wot?
Presumably the seller and the seller's lender aren't privy to the fact that in the next room are a buyer and a new lender ready to pony up a bunch more cash for the same piece of property. They might get a bit annoyed at that. And the end buyer writing a much bigger check for the same junker Shaun just bought, like five minues ago? If they knew what he just paid for it, they might storm out! But Shaun says, no, usually they are aware, but even it they're not, it's still not fraud...right?

Don't know yet, because they broke the call into two parts, and so far only part 1 is available. Watch for the second half soon...I hope! Listen to the call there, then come back here and tell me your thoughts.

I can tell you the title insurer's point of view. Tomorrow...

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Yes, you CAN sell a house around here!

Everyone seems to agree that this is a buyer's market. What about the sellers, then? Well, according to Rebecca Giacobba in the Business Monthly, it's not all doom and gloom:

In 2007, 6,283 homes were sold in Anne Arundel County and 3,341 homes
in Howard County, which is less than 2006 (when 7,456 sold in Anne
Arundel and 3,926 sold in Howard), but still indicative of a healthy
market.
While there is a higher inventory of homes on the market today, people in our area still need and want to purchase homes.

I agree. Buyers can't buy without sellers. So chin up, buckaroo!

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Homesteaders Tax Credit Flip Flop?

The Sun reports that Sen. Edward J. Kasemeyer, a Howard County Democrat and the Maryland Senate majority leader, has sponsored a bill to repeal the recently enacted law that forces homeowners to apply for a tax credit they used to enjoy automatically. This would be good news for homeowners, also for those "bad apples" who own multiple properties (real estate investors) and try to get the tax credit on more than the house they live in.

Kasemeyer said that the effort to weed out tax cheats was well-intentioned. But doing it now is "bad timing," he said, given the many Marylanders' struggle to cope with rising costs of various types and homeowners' complaints about the applications.

Full story here:

http://www.baltimoresun.com/news/local/politics/bal-md.tax31jan31,0,191067.story

Call your public officials in support of the repeal!

Own the sticks and bricks, but not the ground upon which it sits?

There are two sides to every story, and the story of the new laws affecting ground rents in Maryland is no exception.

For home owners subject to ground rent, this new law is a god-send. No longer need they fear of being thrown out of their home for failure to pay what is usually a nominal bi-annual fee. At worst they will face a lien on the property for back rent when they sell. And if they feel on shaky ground because they can’t locate their lease holder, they can stabilize their position in 90 days for less than $100.

From the perspective of the ground rent owner, however, the new laws are an unconstitutional attempt by the state to take their property without fair compensation. In November, a large group of ground rents holders filed suit against the state in Anne Arundel County Circuit Court, claiming the reforms have made ground rent leases worthless. The case is pending, but the political will in Annapolis is strongly in favor of doing away with these antiquated laws.

Yet for all of the hullabaloo about ground rents in Maryland, not much has really happened so far. According to an official at the State Dept. of Assessments and Taxation, the suit has not impacted the owner registration process, which is proceeding surely but slowly. About 2,000 properties have been registered to date, 1% of the expected 200,000 that will be. If the ground rent is registered, or a redemption application has been filed, an icon to that effect will appear in its tax record online.

And the rate of redemption filings has actually decreased.Home owners subject to ground rents may not have to file for redemption at all,but simply wait until the registration period expires in October of 2010, and if the owner has not registered the ground rent, it becomes null and void.

For all the details, visit http://www.dat.state.md.us/sdatweb/real.html.

Prince Georges Country, or Price Gouges County?

I've added a couple of blogs of interest at the bottom of this page. As I find more, I'll add them.

Today I"m trying to find out the real scoop on Prince George's County's revised policies regarding the recordation taxes for non-owner occupied dwellings. Rumor has it as of this week all homes will be considered non-owner occupied, and taxed accordingly, and it will be up to the homeowners to submit proof that they actually do live there. This is the county's way of filtering out the few bad apples who are lying about it. This has already bungled up one of my settlements, and threatens another one in-house.

Stay tuned...

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