Bill Leon, president of Florida’s Broward (County) Real Estate Investors Association, has been buying and selling investment property for years, but he thinks today’s deals are unprecedented. “People are afraid not to sell because they don’t know where the bottom of the market is,” he says.

David Dweck, a hard-money lender, believes the best buys are in what he calls “workforce housing,” aging bungalows on small lots. They are selling for as little as 10 cents on the dollar compared to what they were going for in 2006, he says, then fixed up and resold or rented quickly.

“People have been beaten down by fear, negativity, constant media bombardment,” says Dweck. “There is a silver lining. The future looks bright.”

Sheresa Pompay, an associate with Hunt Real Estate ERA in Chandler, Ariz., says bad publicity is good for real estate investors. “I love the people who read about all the gloom and doom, because they stay on the sidelines and go, ‘It hasn’t hit bottom.’ Whatever. By the time everyone jumps back in, we’ll be out and doing something else.”

Fortune magazine predicts that these will be the 10 worst-performing real-estate markets – and the best places for finding bargains – in 2009:

Los Angeles, down -24.9 percent
Stockton, Calif., -24.7 percent
Riverside, Calif. -23.3 percent
Miami-Miami Beach, -22.8 percent
Sacramento, -22.2 percent
Santa Ana-Anaheim, Calif., -22 percent
Fresno, Calif., -21.6 percent
San Diego, Calif., 21.1 percent
Bakersfield, Calif., -20.9 percent
Washington, D.C., -19.9 percent

Source: Fortune, David Whitford (12/23/2008)

He particularly urges brokers to insist that associates be proactive about haveing properties professional inspected.

“The message should be: ‘This brokerage cannot afford disclosure-related lawsuits. If you work for this company, you must recommend only the most thorough home inspectors available. Here is the list of inspectors we have found to be the most qualified,’” Stone says.

Source: Access Media Group, Barry Stone (12/27/2008)

While there are no official numbers on how many trash-out businesses have opened, a Internet search turns up hundreds of listings, and Entrepreneur Magazine put foreclosure cleaner Cyprexx Services of Brandon, Fla., on its 2008 “Hot 100 Fastest Growing Businesses” list.

Clean-out servicers estimate that it costs about $2,000 to clean out a foreclosed home–more if the departing residents did a substantial amount of damage.
Cassandra Black of Foreclosure Cleanup in Riverdale, Ga., cleans out about 12 homes a month. She says 90 percent of her business comes from real estate practitioners.

With 575,090 loans nationwide entering the foreclosure process during the third quarter, the business is likely to get better before it gets worse.

Source: USA Today, Stephanie Frith (12/30/2008)

A preview of its November report shows that home prices fell 9.6 percent last month, compared with 10.4 percent in October and 11.2 percent in September.

“The consistent deceleration over the past two months with November indicating the same trend in price declines is encouraging because it could portend the trough in price declines,” says Mark Fleming, chief economist for First American CoreLogic.

Still, layoffs and the swollen supply of unsold homes remain a concern, he notes.

Source: American Banker (12/29/08)

The survey, conducted by Harris Interactive for real estate Web site Zillow.com, found that U.S. adults would most like to be neighbors with Sarah Palin (14 percent), followed closely by Oprah Winfrey (13 percent).

Paparazzi magnets apparently don’t make the best neighbors, as only 2 percent of U.S. adults would like to be neighbors with David and Victoria “Posh” Beckham in the coming year.

It also seems age and gender play a prominent role in neighbor preferences:

• Among adult men, Sarah Palin is the most desired neighbor (17 percent), while 17 percent of adult women said that Oprah Winfrey was the most desired neighbor, ahead of Palin (12 percent).
• Among 18-34 year old men, Michael Phelps tops the list as the most desirable neighbor (17 percent). In comparison, only 9 percent of 18-34 year old women thought the gold medal Olympian would make a desirable neighbor.
• The gender gap reveals that among 45-54 year old women; 21 percent voted for Oprah, compared to only 6 percent of their male counterparts.

Worst Neighbors of 2008

Britney Spears, the trouble-prone pop star, was voted the worst celebrity neighbor in 2008, according to one in five (19 percent) U.S. adults. However, Spears’ reputation has improved over the past 12 months. In 2007, 21 percent voted Britney the worst neighbor.

Rosie O’Donnell was a close second in 2008, with 18 percent of the votes, compared with 14 percent in 2007. Rounding out the top 5 worst list is Joe the Plumber (8 percent) Lindsay Lohan (7 percent) and Adam “Pacman” Jones (6 percent).

Source: PRNewswire

The definition of first-time homebuyer is generous. To get the credit, the homebuyer cannot have owned a home in the previous three years. The home must be a principal residence and purchased between April 9, 2008 and July 1, 2009.

The credit is equal to 10 percent of the purchase price, up to $7,500. Single taxpayers with modified adjusted gross income up to $75,000 and couples with MAGI up to $150,000 will qualify for full credit. Singles with MAGI up to $95,000 and couples with MAGI up to $170,000 will get a reduced amount. Those with higher incomes don’t qualify.

If the amount of tax a homebuyer owes is less than the amount of the credit, they get to keep the difference in the form of an IRS refund.
The homebuyer must begin to repay the credit in two years in increments of about $500 a year over a 15-year period for those who received the full credit
Homebuyers who sell their home before the credit is repaid must pay off the loan with any profits. If they sell the home at a loss, the loan is forgiven.

[Editor's Note: The credit is set to expire in mid-2009, although industry groups, including the NATIONAL ASSOCIATION OF REALTORS®, are encouraging Congress to extend it. NAR is also encouraging Congress to make the credit available to all buyers and to eliminate the repayment requirement. More detail on how the credit works is available from NAR on REALTOR.org.]

Source: Chicago Tribune, Mary Umberger (12/28/2008)

“We’re in the middle of the game here,” said Joseph Seneca, professor of economics at Rutgers University in New Jersey. “There’s significant further unwinding to come. We’re in a downward spiral with job losses that is reinforcing the weakness in the consumer markets, particularly in the largest investment the consumer makes, in his home.”

Seneca says the government’s aggressive efforts to stabilize housing are helping, but housing won’t really recover until prices fall so far that large numbers of buyers jump back into the game.

In the meantime, the price of housing is increasing in some areas that are immune to the economic slowdown. These areas include the energy-producing states of North Dakota, South Dakota, Okalahoma, Alaska and Montana. Washington, D.C. with its host of government and defense jobs is doing well. Boston, San Diego and Orange County, Calif., where prices have dropped enough to increase affordability significantly, are also seeing price increases.

Source: Business Week, Prashant Gopal (12/24/2008)

Application activity for the week ending December 19th was 124.6 percent over the same period a year ago, the Washington, D.C-based MBA said. The spike in applications coincided with another drop in mortgage rates, as the government’s efforts to unfreeze the residential-mortgage market show further signs of having the desired effect.

Applications to refinance existing mortgages increased 62.6 percent on a week-to-week basis, while applications filed for mortgages to buy homes increased a seasonally adjusted 10.6 percent. Refinancings made up 83.2 percent of all applications filed last week, up from 76.9 percent the previous week.

According to the MBA survey, interest rates fell across the board:

• Rates on 30-year fixed-rate mortgages averaged 5.04 percent last week, their lowest level in more than five years.

This was down from 5.18 percent the previous week.

• Fifteen-year fixed-rate mortgages averaged 4.91 percent, down from 4.93 percent the week before.
• One-year ARMs averaged 6.36 percent, down from 6.63 percent.

Source: Mortgage Bankers Association and MarketWatch (12/24/08)

We won’t make that judgment. But Forbes says that these are cities that many had never heard of until now.

Many of these cities grew quickly because of the housing boom and lie just beyond more established locales. Now that the boom is over, these cities are getting noticed because of high foreclosure rates.

Here’s Forbes’ list of the most boring—or ignored—cities and their populations.

• Chula Vista, Calif. Population: 217,478
• Hialeah, Fla.: 212,217
• Mesa, Ariz.: 452,933
• North Las Vegas, Nev.: 212,114
• Chandler, Ariz.: 246,399
• Santa Ana, Calif.: 339,555
• Bakersfield, Calif.: 315,837
• Aurora, Colo.: 311,794
• Gilbert, Ariz.: 207,550
• Henderson, Nev.: 249,386

Source: Forbes, Joshua Zumbrun (12/10/08)

Some experts believe the jump in refis could signal a turning point in the market and reduce pressure on banks by the U.S. government to bolster lending following the distribution of millions of dollars in assistance.

However, it remains uncertain how many borrowers will qualify for loans, how long it will take to process loans under new documentation and credit standards, and whether borrowers will back down in hopes that mortgage rates will fall further.

Source: Wall Street Journal, Dan Fitzpatrick (12/22/08)