Portland Real Estate Blog

FBI Cracks Down On Oregon Mortgage Fraud

The Oregon Office of the FBI is cracking down on real estate related mortgage fraud in conjuction with the US Attorney General's Office.  The dedicated web page on mortgage related fraud in Oregon is very interesting.  The first scheme target is homeowners by Foreclosure Specialists:

Foreclosure Rescue Schemes

One of the biggest concerns for consumers now comes in the form of unscrupulous “foreclosure specialists.” In some cases, desperate homeowners sign over the deed to their home to these “specialists” believing that they can stay in the home, make “rent” payments, and eventually re-purchase the property. In many cases, the “rent” payments that are supposed to go to the mortgage company never get sent. The “specialist” simply pockets the payments and any extra fees. The home continues into foreclosure, and the homeowner loses even more money.

The second has two parties scheming together to defraud banks:

Short Sales

A second area of concern involves “short sales.” In this instance, a buyer purchases a home with no intention of making payments. Oftentimes, additional funds are included in the loan for “improvements.” The buyer pockets that money and informs the bank several months later that the house will foreclose. The buyer presents a possible pre-foreclosure buyer. This second fraudster makes a deal with the lender to purchase the home below the current loan amount. The lender agrees, not knowing that the mortgage payments were deliberately not made to fabricate this short-sale situation. Sometimes, the new buyer or previous homeowner will damage the house to prove its lower worth. After the deal closes, the fraudster repairs the damage, gets the home appraised at a higher level, and re-sells it for a profit.

The FBI has a tip line and a list of advice on the site.

Citizens can send tips to the FBI at mortgagefraudtips.portland@ic.fbi.gov or call (503) 273-5813.

American Home Shield (AHS) Listing Coverage

I'm looking at an electrical invoice for $385 for one of our listings.  The seller paid the $60 deductible on the American Home Shield warranty that we provide (through Prudential Northwest Properties) during the listing period.  The rest of the invoice is covered by AHS. 

If Houses Could Talk

"Where's it hurt?  What Happened?"  Our toddler is barely talking but he can point to what hurts and how it happened.  The last couple of days I've shown some houses and that small bit of communication would go a long way.  As a commodity, it doesn't matter why the seller is selling a house but human nature wants to know the answer.  That's proven that some states (not Oregon) require disclosure of events that do not have any impact on the physical condition of the property.

The last few days of showing property left us asking these questions: What motivated them to spray paint the bathtub construction orange?  Why was the open suitcase of children's toys left open and behind in the center of the bedroom and the halmarked Sterling silver salad servers left amung the debris on the kitchen counter?  Were they trying to burn the house down by leaving the iron face down on the floor or was it an accident that was caught right before the flames started (burned all the way through the laminate floor into the subfloor)?

Regardless of the actual answer or the path to get there, the result is sad and tragic.

Real Estate Takes Over Oregonian Business Section

There are three or four real estate related articles on the cover of today's Oregonian business section depending on how you count them. 

1. Ryan Frank (of Front Porch fame) reports that JLS Homes is liquidating homes to avoid bankruptcy.  The potential sale of 70 homes, most of them at a loss, may allow them to start building again.  
2. Umpqua bank is feeling the pain of the economy but not as much as some of its competition, in part  because, "Umpqua had less exposure to residential development that some other Northwest banks, nearly all of which had jumped enthusiastically into the housing sector boom."
3. The owners of Pioneer Place have filed for Chapter 11.  General Growth Properties has at least part ownership of a large list of malls in the state and throughout the country.
4. The feature story on the page is Secret Recipe: the Three Day Kitchen. Forty percent of all construction spending is spent on remodels.  The 3-Day Kitchen and Bath franchise put the interviewed home owner up at the Holiday Inn while they worked long days to complete the job.
5. For those of you in Eugune, there's a foreclosure bus just for you.  The comments are delveloping into a pro/anti Realtor debate (Realtor is capitolized because it is a copyrighted name and really should be Realtor©).  Buy four articles, get the fifth for free (found the link to this while looking up the others on Oregonlive).

Go Blazers!

Radon's Role in Portland Real Estate

We'll write more about radon and real estate soon but it is worth mentioning now that we are 0-3 on our last three radon tests.  All three of our buyer's inspections have come back with higher than acceptable levels.  The EPA publishes A Citizen's Guide to Radon:        

Radon is a cancer-causing, radioactive gas.

You can't see radon. And you can't smell it or taste it. But it may be a problem in your home.

Radon is estimated to cause many thousands of deaths each year. That's because when you breathe air containing radon, you can get lung cancer. In fact, the Surgeon General has warned that radon is the second leading cause of lung cancer in the United States today. Only smoking causes more lung cancer deaths. If you smoke and your home has high radon levels, your risk of lung cancer is especially high.

There is brief mention of radon in the Oregon Property Buyer's Advisory under the Environmental Hazards section.

RMLS Market Action March 2009 Neighborhood Breakdowns.

 
The chart above is from the March 2009 Market Action (click to enlarge). 

The four areas that make up Portland have all seen a significant drop in pending sales compared to last year (16%-30%) whereas Gresham/Troutdale, Oregon City and  Milwaukie/Clackamas saw an increases (1.7% and 7.3% and 10.7% respectively).  The 12 month rolling average sales price is down across the board.  North Portland has the lowest market time at 114 days.

RMLS Market Action March 2009

Did Portland real estate hit bottom in January?  Are we looking back at the bottom or a bump?  Portland housing inventory dropped again in March 2009 to 12 months RMLS Market Action reports.  January had the highest ever recorded inventory at 19.2 months, it dropped to 16.6 in February and March levels are close to the levels reported in both January and October 2008.  There's been a drop in inventory every February to March reporting period in the last three years.   The 26.5% drop this year is about the same as the 26.9% drop seen in 2006 but more than doubles the 12.5% drop in 2007.  I feel the real estate market is gaining straingth but the overall economic picture leaves a question mark.

Year to date numbers are higher for both pending and closed sales and median price but are not at 2008 levels.  The number of listed houses has not decreased sigificantly from February (down a total of 30 units) so the decrease in inventory is due to an increase in sales.  Last week's post provides graphs as to where those listings are located and in what price range.

How Many Listings Are There In Portland?

RMLS reported that there was 16.6 months of inventory Portland in February.  This image will scroll through all the breakdown as to where those listings are in different price ranges.  The graphs will update monthly but depending on how they behave on the blog, may be moved to another location.  ***scrolling didn't work so here they all are:

Announcing www.PDXBuyers.com

Regular readers have probably noticed fewer posts here over the last month.  I haven't been idle but have been building a new website.  www.PDXBuyers.com is our newest site.  It has a couple of features that I believe are unique to our site (at least for now). 

The first feature is the introduction of Market Tracker information for each zip code in Portland available online.  The graphs are the same ones used in the report that you can have delivered to your inbox each month.   The four graphs break down zip codes by average sales price, number of units sold across price ranges, rate of appreciation across price ranges and price per square foot.  Each graph will be updated during the first week of the month to reflect the previous month's activity.

The Market Tracker graphs are also tied to a property search for each zip code.  We've defined the search as residential property but you can easily modify the search, save it and set it to email properties that meet your specific requirements.

We've created an "Ask the Experts" page as well.  We currently have industry experts in the insurance, mortgage and home inspection industries explaining what their role in the real estate transaction is.

As with everything, there is still more to do and you'll see some changes in the coming weeks but that should be mostly cosmetic.  This blog will also be getting a face lift in short order.

Try to get out and enjoy the sun.

Portland Case Shiller Index Retreats to August 2005 Level

Case Shiller released their report for January today and I don't think that it will be a surprise to anyone that the January 2009 Index dropped from December's 158.5.  At 153.8, it's about the same level reported in August of 2005.  The 20 city index is down 19% from January 2008.  Portland is down 14%.

Is that the bottom?  Maybe, maybe not.  RMLS reported lower inventory in February, it seem like lending is getting easier with lower rates, and the First Time Buyer Credit is now really a credit and not an interest free loan.  Weighing in heavily on the other side is unemployment, the uncertain fate of GM and Chrylser, war, etc.

This link was post on Realtor.org as a reposting of a Newsweek story: "Top Economists See Recovery Differently."  Link added (1:30PM)