Beat And Battered

From the Star Ledger:

INSTEAD OF FORECLOSED: SOLD!

A dozen chatty women and children stepped off a yellow school bus Saturday morning and into a vacant condo on 5th Street in Elizabeth. Armed with notepads, digital cameras and binders, they sounded optimistic about finding their dream home in the Union County city.

They peppered tour guides with questions about taxes, schools, unfinished basements and the number of bedrooms in each of the dozen properties the group would see. But this wasn’t an ordinary real estate tour.

It was a foreclosure bus tour hosted by the city — the first in the state to offer such tours as a public service, according to the New Jersey League of Municipalities.

In Florida, California and Michigan, where the housing foreclosure crisis has hit residents especially hard, these tours are becoming the rage among real estate agents. In New Jersey, which according to RealtyTrac, a firm that monitors foreclosures, saw a 140 percent jump in foreclosure filings over the last three months, real estate agents are catching on.

Tours are being organized in Sussex, Morris, Union and Warren counties and along the Shore. But this one was different: It was designed not only to help first-time buyers get an affordable home, but to keep troubled homeowners above water.

“Maybe it’s better to call it a ‘pre-foreclosure tour,’” said the city’s housing program director, Susan Ucci. “We want to prevent people from going into foreclosure.”
…
Only one of the homes on the tour had been repossessed by the lender; the rest were nearing foreclosure. Tour guides — carrying binders of information to match prospective buyers with sellers — were members of the city’s Home Improvement Program and the nonprofit housing group Brand New Day. The nine prospective buyers on the tour, all women, were pre-qualified for mortgages by Brand New Day, and all took and passed classes for first-time home-buyers.

Elizabeth’s program stands out, Ucci said, with benefits for all involved. Homeowners don’t go through the painful and credit-ruining foreclosure process. First-time buyers get a bargain on a home and “we get an occupied house instead of a foreclosed house in the neighborhood.”

Bill Dressel, executive director of the New Jersey League of Municipalities, said this is the first he’s heard of a city working with a nonprofit group to show off nearly foreclosed homes.

“I think it’s absolutely brilliant,” Dressel said, adding he wants to promote the program across the state. “It cuts through a lot of bureaucracy, and it literally matches people in homes where they want to be.”
…
Sandra Johnson, from Edison, said she was hesitant to look at homes that are near foreclosure but came on the tour because she was curious about what the market has to offer. “The tour is beautiful,” she said. “Everybody’s reminding you about what you can afford. A Realtor’s not reminding you.”

Organizers are planning another tour in September. And cities across the state may soon follow suit. Jacques Howard, economic director of Plainfield, said the tours “make perfect sense.” He plans on rolling out a comprehensive package of programs to battle foreclosure in his Union County city. He hopes to include home foreclosure tours.

When homes are vacant, “the city’s losing, the bank’s losing, everyone’s losing,” Howard said.

Preliminary June sales and inventory data for Northern New Jersey (GSMLS) is in. Please note that this data is subject to revision.

The first graph plots the unadjusted sales data (closed sales) for the counties listed. Please note the lower bound of the graph, it is set to 500, not to zero. I do this to emphasize the seasonal nature of the Northern NJ market.

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The second graph is another view at the sales data for the full year. Please note that this graph does cross at zero.

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The third graph displays only June sales, 2001 to 2008 YOY.

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The fourth graph displays an overlay of Sales and Inventory from 2003 to 2007.

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The fifth graph displays the year over year change in inventory on a month by month basis.

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The sixth graph displays the year over year change in sales on a month by month basis.

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The last graph displays the absorption rate (not seasonally adjusted), in months:

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Bonus Graphs!

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From the Press of Atlantic City:

Short sales saving more locals from foreclosure

An alternative to foreclosure for some homeowners called a short sale is becoming more common in southern New Jersey, according to attorneys who handle such transactions.

Short sales are for homeowners who owe more on their mortgage than the property is worth and need to sell the house to get their finances in order.

For it to work, the lender must agree to accept as payment for the loan what the property is currently worth rather than the higher amount borrowed to buy it.

Lenders such as banks are free to insist on getting full repayment of the loan and many do, said attorney Jeffrey P. Barnes, of Stefankiewicz and Barnes in North Wildwood.

“But it sometimes makes sense to take the market value because the bank will be putting the property up for sale anyway if it goes through foreclosure after paying thousands in attorney’s fees,” Barnes said Friday.

As an example, Barnes told of a Pennsylvania couple who bought a second home in the Wildwoods. As a result of falling real estate values, they wound up owing $50,000 more for the condo than it was worth.

The couple had hoped to rent it out but couldn’t at a price that would cover their mortgage costs, he said. And they had taken out a home equity loan for the down payment on the second home and now couldn’t keep up with all the payments.

“They got quite emotional about it. They had always paid their bills, and they didn’t know what to do. They tried whatever they could to keep it going,” Barnes said.

When their savings were depleted, they looked for a solution and pursued a short sale. Their bank allowed it and in a couple of months, they got out of the second home, he said.