Flipped Houses In St Louis Jumps Nearly 14 Percent During First Quarter

There were 542 homes “flipped” in the St Louis metro area during the first quarter of 2020, or 8.5% of the total number of homes sold in the St Louis metro area during the quarter, according to data just released by ATTOM Data Solutions.  This is an increase of 13.8% from the prior quarter and is a decrease of 2% from a year ago.  The median gross profit was 52,900 a 60.8% gross ROI.

Definition of a  “flipped” home…

For the purposes of this report, a flipped home is considered to be any home or condo that was sold during the first quarter of this year in an arms-length sale that had previously had an arms-length sale within the prior 12 months.  Since homeowners don’t tend to buy a home only to turn around and resell it within a year, when this does occur it is typically the result of an investor buying a property, renovating it, then reselling it.

  

St Louis House Flipping – 1st Quarter 2020

St Louis House Flipping - 1st Quarter 2020© 2019 – St Louis Real Estate News, all rights reserved

HUD, Fannie Mae & Freddie Mac Suspend Foreclosures for at least 60 days

In response to the coronavirus pandemic, the U.S. Dept. of Housing and Urban Development (HUD), as well as the Federal Housing Finance Agency (FHFA) (which oversees Fannie Mae and Freddie Mac), directed their loan servicers to suspect foreclosures and evictions for at least 60 days to help those people affected.

In a statement, Mark Calabria, the Director of the FHFA, said that borrowers affected by the coronavirus who are having difficulty paying their mortgages should reach out to the mortgage servicers as soon as possible.

HUD Secretary Ben Carson said that “The halting of all foreclosure actions and evictions for the next 60 days will provide homeowners with some peace of mind during these trying times,”

St Louis House Flips Increase In 4th Quarter of 2019

There were 737 homes “flipped” in the St Louis metro area during the fourth quarter of 2019, or 7.2% of the total number of homes sold in the St Louis metro area during the quarter, according to data just released by ATTOM Data Solutions.  This is an increase of 9% from the prior quarter and is a decrease of 6% from a year ago.  The median gross profit was 64.450 a 71% gross ROI and a significant increase from a year ago when the Gross ROI was 54.1%.

Definition of a  “flipped” home…

For the purposes of this report, a flipped home is considered to be any home or condo that was sold during the first quarter of this year in an arms-length sale that had previously had an arms-length sale within the prior 12 months.  Since homeowners don’t tend to buy a home only to turn around and resell it within a year, when this does occur it is typically the result of an investor buying a property, renovating it, then reselling it.

  

St Louis House Flipping – 4th Quarter 2019

St Louis House Flipping - 4th Quarter 2019© 2019 – St Louis Real Estate News, all rights reserved

Distressed Home Sales In St Louis MSA Fall Nearly 25 Percent In Past 12 Months

Thanks to a booming economy and strong housing market, distressed home sales in the St Louis Metro Area declined by nearly 25 percent (23.42%) in the 12-month period ended January 31, 2020 from the prior 12-month period. As our exclusive, STL Market Report below shows, there were 1,887 distressed home sales (foreclosures, REO’s and short sales)in the most recent 12-month period compared with 2,464 in the prior 12-month period.  The median home price of the distressed homes sold declined 1.79% during the same period, from a median price of $56,000 in the prior period to $55,000 in the most recent period.

  

Distressed Home Sales  St Louis MSA

(Foreclosures-REO’s-Short Sales) – Past 12 Months vs Prior 12 Months

(click on table for current report)

Distressed Home Sales  St Louis MSA 

Bernie’s Plan For Housing Likely To Negatively Impact Investors

Let me begin with this is not a political statement and the purpose of this site is not about politics but about real estate.  Having said that, this morning I came across the plans for the housing market that Bernie Sanders is proposing if he is elected President which I had not seen before.  Upon reviewing his plan (it is on his official site) I realized that while many of the components of it sound good (like “End homelessness and ensure fair housing for all”) many of his promises in this area sound like things that would negatively impact investors and the housing market as a whole.

The following are the Key Points to the Bernie Sanders housing plan from his website (I have included the complete list):

  • End the housing crisis by investing $2.5 trillion to build nearly 10 million permanently affordable housing units.
  • Protect tenants by implementing a national rent control standard, a “just-cause” requirement for evictions, and ensuring the right to counsel in housing disputes.
  • Make rent affordable by making Section 8 vouchers available to all eligible families without a waitlist and strengthening the Fair Housing Act.
  • Combat gentrification, exclusionary zoning, segregation, and speculation.
  • End homelessness and ensure fair housing for all
  • Revitalize public housing by investing $70 billion to repair, decarbonize, and build new public housing.

Under the “When Bernie is president, he will” section are some of the things he plans to do to accomplish the above goals (this list is rather extensive on his site so I have only included a sampling of the items that appear will negatively impact investors and homeowners):

  • Enact a national cap on annual rent increases at no more than 3 percent or 1.5 times the Consumer Price Index (whichever is higher) to help prevent the exploitation of tenants at the hands of private landlords.
  • Allow states and cities to pass even stronger rent control standards.
  • Implement a “just-cause” requirement for evictions, which would allow a landlord to evict a tenant only for specific violations and prevent landlords from evicting tenants for arbitrary or retaliatory reasons.
  • Place a 25 percent House Flipping tax on speculators who sell a non-owner-occupied property, if sold for more than it was purchased within 5 years of purchase.
  • Impose a 2 percent Empty Homes tax on the property value of vacant, owned homes to bring more units into the market and curb the use of housing as speculative investment.

Again, this is not a political piece, but given the strong housing market we have enjoyed over the past several years, which has helped many Americans build equity and recover wealth lost during the housing bubble burst of 2008, I think it’s worth noting proposed plans, by any party or power, that could negatively impact the market. Also, these are just talking points from someone running for office, so whether it’s Bernie Sanders or any other candidate, or even the current President, Donald J. Trump, they can all have ideas but getting them implemented takes cooperation of Congress and that is not always so easy so it doesn’t mean any of their plans ever actually come to fruition.

 

 

Why I’m Bullish On Real Estate For 2020

As you may have noticed, I’ve been pretty optimistic about the outlook for the real estate market this year however, that is not always the case as I call it like I see it.  The reason for my optimism is based upon what a true data geek like myself would base it upon, data!  So, what’s the data that has me believing 2020 will be a good year for the housing market in St Louis and beyond?  Several things:

  • As I have been reporting here for the past couple of years now, mortgage delinquency and foreclosure rates have continued to decline which show the strength of the economy as a whole as well as the housing industry.
  • As the US Economic Indicators charts below show, since peaking around 2010, the unemployment rate, 30-year mortgage rate and mortgage delinquency rates have all steadily declines to either record lows or at least the lowest rate in recent history.
  • As the St Louis unemployment, home prices and rent chart below shows, unemployment in St Louis has fallen to the lowest level in decades and the relationship between home prices and rents show home prices lagging behind rents indicating that we’ll likely see continued, good housing appreciation rates.
  • As the 30-year fixed rate mortgage chart below shows, mortgage rates are at near record low rates giving buyers much more buying power.  In my market update video I shared here a day or two ago I illustrate just how much more buying power this translates into.
  • As I reported last week, St Louis home sales last year managed to top the prior year slightly, in spite of the low-inventory market we have been stuck in.  This shows the demand that is out there.
  • As I reported earlier this week, the home sales trend for 2020 in St Louis is in positive territory has well.

St Louis Underwater Homeowners Falls To Lowest Percentage In Over 6 Years

During the fourth quarter of 2019, 10.2% of the homeowners in St Louis with a mortgage, were underwater on their mortgage, meaning they were in a negative-equity position, according to data just released by ATTOM Data Research.  As the table below shows, this is the lowest level of St Louis homeowners that are seriously underwater since 2013 when this data was first tracked.  This continues the trend that began in the price quarter with the then lowest rate at 10.5%.

St Louis Underwater (Negative-Equity) Homeowners

(Click on table for live, complete data from 2013-Present)
St Louis Underwater (Negative-Equity) Homeowners

In 2019 St Louis Had The 8th Highest Foreclosure Rate of The 20 Largest MSA’s

Foreclosure rates and mortgage delinquency rates have steadily declined over the past couple of years as the housing market, as well as the overall economy, have both continued to improve and thrive.  Nonetheless, foreclosures still take place and during 2019 the St Louis MSA had the 8th highest foreclosure rate of the 20 largest MSAs, according to the latest data released by Attom Data Solutions.

As the table below shows, during 2019, in the St Louis MSA there was 1 foreclosure action for every 232 housing units.  Philadelphia, PA, had the highest foreclosure rate of the 20-largest MSAs with one foreclosure action for every 133 housing units and San Francisco had the lowest with one foreclosure action for every 631 housing units.

  

2019 Foreclosure Rates – 20 Largest MSAs

2019 Foreclosure Rates – 20 Largest MSAs

Copyright 2020 – St Louis Real Estate News – All rights reserved – Data Source ATTOM Data Solutions

The Foreclosure Rate in the St Louis Metro Area Falls Again In November

The foreclosure rate for the St Louis MSA during October decreased 6.0 percent from the month and was down 4.2% from November  2018, according to data just released from ATTOM Data Solutions.  As the table below shows, there were, like last month, some mixed results.  For example, St Charles County saw a 20% increase in foreclosures from the month before while the City of St Louis saw a 27% decrease from the month before.  The U.S. as a whole saw a bigger decline in foreclosure activity than the St Louis MSA did.

  

St Louis MSA Foreclosures – November 2019

St Louis MSA Foreclosures - November 2019

St Louis House Flips Continue To Decline

There were 762 homes “flipped” in the St Louis metro area during the third quarter of 2019, or 6.3% of the total number of homes sold in the St Louis metro area during the quarter, according to data just released by ATTOM Data Solutions.  This is a decline of 15% from the prior quarter as well as a 5% decrease from the prior year.  As our table below shows, on a national level, house flipping accounted for just 5.4% of the homes sold during the 3rd quarter of this year, which is a 9% decrease from the quarter before and a 4% increase from a year ago.

Definition of a  “flipped” home…

For the purposes of this report, a flipped home is considered to be any home or condo that was sold during the first quarter of this year in an arms-length sale that had previously had an arms-length sale within the prior 12 months.  Since homeowners don’t tend to buy a home only to turn around and resell it within a year, when this does occur it is typically the result of an investor buying a property, renovating it, then reselling it.

  

St Louis House Flipping – 3rd Quarter 2019

St Louis House Flipping - 3rd Quarter 2019© 2019 – St Louis Real Estate News, all rights reserved

Foreclosures Spike In October In Some St Louis Areas

The foreclosure rate for the St Louis MSA during October increased 11.3 percent from the month before however, it was still nearly 25 percent (24.5%) lower than October 2018, according to data just released from ATTOM Data Solutions.  As the table below shows, there were some real mixed results this month.  For example, St Charles County saw a 150% increase in foreclosures from the month before increasing from 10 in September to 25 in October but is down over 60% from October 2018.  The city of St Louis is the only county of significant size in the St Louis MSA that saw both an increase in foreclosures from the month before (65.8^) as well as an increase from a year ago (43.2%).

  

St Louis MSA Foreclosures – October 2019

St Louis MSA Foreclosures - October 2019

The Percentage Of Underwater Homeowners In St Louis Drops To Lowest Level In Six Years

During the third quarter of 2019, 10.5% of the homeowners in St Louis with a mortgage, were underwater on their mortgage, meaning they were in a negative-equity position, according to data just released by ATTOM Data Research.  As the table below shows, this is the lowest level of St Louis homeowners that are seriously underwater since 2013 when this data was first tracked.

St Louis Underwater (Negative-Equity) Homeowners – 2013-2019

St Louis Underwater (Negative-Equity) Homeowners - 2013-2019

Distressed Home Sales In February Fall Back to 2008 Rate

Distressed home sales (foreclosures, REO’s and short sales) made up 13.5 percent of the home sales in the U.S. in February, 2015, a decline of 18% from a year ago when the rate was 16.5 percent and is a decline of 5.6% from January when the rate was 14.3%, according to a report just released by Corelogic.  The rate of distressed home sales in February 2015 marks the lowest rate for the month of February since February 2008, according to the report.

 

REO Sales down almost two-thirds from peak

During the peak, January 2009, distressed home sales accounted for 32.4 percent of al home sales with REO sales making up 27.9% of that share.  In February, 2015, REO sales accounted for 9.7 percent of all home sales, a decline of nearly two-thirds (65.23%).

Short Sales down only slightly

Quite different than the figures for REO sales, short sales accounted for 4.5% of all home sales back in January 2009 and still accounted for 3.8% of them in February 2015, for a decline of just 15.6% percent.

Still far from “normal”

Even with the declines, we are a far way from “normal”….prior to the real estate market crisis, distressed home sales made accounted for just about 2% of home sales so we still have a long way to go.

 

Michigan is the king of distress

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Continue reading “Distressed Home Sales In February Fall Back to 2008 Rate

Fannie Mae Launches "Know Your Options" Foreclosure Prevention Program

saint-louis-real-estate-dennis-normanFannie Mae has launched a new foreclosure prevention program called “Know your Options” that has been in development for about a year and has, as it’s top priority, “helping homeowners avoid foreclosure”.  The program includes working with and training 18 of it’s largest loan servicers as well as launching a website for consumers, KnowYourOptions.com, which contains educational tools and resources for homeowners that may be facing foreclosure and opening 12 “Mortgage Help Centers” in the areas hardest hit by the housing crisis.

Foreclosures in May down almost 20 percent from year ago

dennis-norman-st-louis-real-estate-foreclosuresAccording to a report released today by CoreLogic, there were 63,000 completed foreclosures in the U.S. in May 2012, down from 62,000 the month before and down almost 20 percent (18.18) from May 2011. Since the real estate market meltdown began in September 2008 there have been about 3.6 million homes that had forecloses completed upon. Continue reading “Foreclosures in May down almost 20 percent from year ago

Mortgage delinquencies increase for second-consecutive month

st-louis-realtor-dennis-norman-mortgage-delinquency-foreclosure-rate

The mortgage delinquency rate (the percentage of home loans 30 or more days past due) increased in May 1.1 percent from the month before according to the latest “First Watch Report” from Lenders Processing Services (LPS). While it’s a modest increase, this marks the second consecutive month we’ve seen an increase in mortgage delinquency rates reversing the downward trend for the 9 months prior which is not good. Since delinquent mortgages are the precursor to forelcosures and foreclosures have wreaked havoc on home prices, this is something we definitely want to keep an eye on. Continue reading “Mortgage delinquencies increase for second-consecutive month

Mortgage defaults fall to lowest level in 5 years

According to a report just released by S&P Experian, the first mortgage default rate fell by more than a quarter of a percent (26 basis points) in May compared to April and is the lowest rate since May 2007. The second mortgage rate also fell during the month, by 5 basis points, and is at a seven year low.

Mortgage defaults and delinquencies are the pre-cursor to foreclosures and foreclosures are the enemy of home prices so this is good news and a trend that, if it continues, should point the way to a housing recovery.

Looking for a bargain vacation home near the beach?

dennis-norman-st-louis-realtor-My family is definitely a beach-loving family! Most of the trips and vacations our family has been on over the years have included beaches and both of our children’s first trips as infants were to the beach. So, I guess it is safe to say our family loves beaches and we are not alone! There is always demand for homes in beach communities even during the real estate bust. Some areas, like Sarasota, Florida, are already seeing prices increase on homes located on or near the beach. Did you wait too late to buy that second home or vacation home in a beach community? Well, according to a report just released by RealtyTrac, there are still some bargains to be found out there! Where? Well, read on….. Continue reading “Looking for a bargain vacation home near the beach?

How to apply for independent foreclosure review

dennis-norman-st-louis-realtor-UPDATE – August 2, 2012 – The deadline for requesting a review of your mortgage foreclosure under the federal banking agencies’ Independent Foreclosure Review has been extended until December 31, 2012

If you feel you were a victim of an improper foreclosure process in 2009 or 2010 by one of the companies below, you may apply for an independent foreclosure review and receive compensation if the independent review finds evidence of direct financial injury to you due to servicer error. Time is running out however as the deadline to apply is July 31, 2012. To make it easier to understand the process, the fed’s have produced a video on how to apply which I have included below. Continue reading “How to apply for independent foreclosure review

Mortgage delinquencies increase in April;   first increase in nine months

st-louis-realtor-dennis-norman-mortgage-delinquency-foreclosure-rate

The mortgage delinquency rate (the percentage of home loans 30 or more days past due) increased in April 0.4 percent from the month before according to the latest “First Watch Report” from Lenders Processing Services (LPS). While this is a modest increase, it temporarily reverses the trend we have seen for the past 9 months of declining mortgage delinquency rates. The mortgage delinquency rate in April, at 7.12 percent of all loans, is down 10.6 percent from a year ago however. The foreclosure rate for April was 4.14 percent, the same as the month before as well as the year before so, at least the foreclosure rate is remaining flat and not increasing. Continue reading “Mortgage delinquencies increase in April;   first increase in nine months

Foreclosures in 2011 down 24 percent from 2010

dennis-norman-foreclosures1.4 Million Homes in the Foreclosure Inventory at the End of 2011

According to a report just released by CoreLogic, there were 830,000 foreclosures completed during the year in 2011, a 24 percent decrease from 2010 when there were 1.1 million. For the month of December, there were 55,000 foreclosures, down 3.5 percent from November when there were 57,000 and down 17.9 percent from December 2010 when there were 67,000 foreclosures completed. Continue reading “Foreclosures in 2011 down 24 percent from 2010

AG Settlement: Not Perfect, But Significant Reform of Mortgage Servicing

Based on what we’ve heard, the settlement between major banks and states’ Attorneys General (AGs), the federal Department of Housing and Urban Development, and the Department of Justice would represent an important step forward in addressing foreclosure abuses. The settlement would include key reforms to clean up unfair mortgage servicing practices. It would also provide an important template for ways banks can use principal reduction to reduce unnecessary foreclosures and put the country back on a path to economic recovery. Continue reading “AG Settlement: Not Perfect, But Significant Reform of Mortgage Servicing

Housing market not out of the woods yet

Dennis Norman St Louis RealtorMark Fleming, Ph.D., Chief Economist for CoreLogic, in a presentation yesterday, said the housing market is not out of the woods yet as the potential of a double-dip in our economy increases and as 30 to 40 percent of economists feel there is a chance of another recession. The economy’s “stall speed” was another issue Fleming said was a concern, describing it as similar to the stall speed of an airplane; that speed at which is still fast enough for the plane to be flying, but just on the edge of stalling and no longer able to maintain flight. Fleming said, for the economy, a 1 percent growth rate is historically the “stall” point and that is right about where we are presently. Continue reading “Housing market not out of the woods yet

Shadow Inventory Continues to Decline; Good news for the housing market

Dennis Norman St Louis

A report released this morning by CoreLogic shows that the current residential “shadow” inventory as of July 2011 declined slightly from 1.7 million units in April to 1.6 million units, and was down from 1.9 million units a year ago. This current shadow inventory represents a 5 month supply. CoreLogic includes in it’s shadow inventory numbers properties that are either 90+ days delinquent on mortgages, in some stage of foreclosure, or an REO but not presently for sale in an MLS. Continue reading “Shadow Inventory Continues to Decline; Good news for the housing market

Increased foreclosure activity and potential REO inventory growth point to trouble for real estate market

Signs point to trouble ahead for the housing market as recent growth in foreclosure filings suggest REO Inventories may balloon in coming months according to the Radar Logic July 2011 Monthly Housing Market Report. On the heels of a couple of upbeat articles I’ve been able to write about the market, I get hit with the glumness of this one….ugh. However, as I have said before, I have a lot of respect for this company and have found their market forecasts to be reasonably accurate, unfortunately. Continue reading “Increased foreclosure activity and potential REO inventory growth point to trouble for real estate market

Mortgage delinquencies decline in August; down almost 12 percent from year ago

I keep saying that, until the foreclosure rate gets back down closer to a “normal” rate and the REO inventory is absorbed to the point where they are no longer putting such immense downward pressure on home prices, we are not going to see any sort of sustainable recovery in the housing market. It all starts with mortgage delinquencies, and as those go so go foreclosures and REO inventory ultimately. Having said that, we have some good news: A “first-look” report issued by Lender Processing Services, one of the countries largest loan servicers and aggregators of loan performance data, shows mortgage delinquencies decreased 2.5 percent in August from the month before and decreased 11.8 percent from the year before. According to the report, the U.S. foreclosure pre-sale inventory rate increased 0.1 percent from the month before and was up 8.2 percent from the year before. Continue reading “Mortgage delinquencies decline in August; down almost 12 percent from year ago

REALTORS offer suggestions to the Fed on how to deal with the REO problem

Dennis Norman, St Louis REALTORNational Association of REALTORS® (NAR) President, Ron Phipps, wrote a letter to Shaun Donovan, Secretary of the Department of Housing and Urban Development, Timothy Geithner, Secretary of the Treasury Department and Edward DeMarco, Acting Director of the Federal Housing Finance Agency with suggestions on how to improve the Real Estate Owned (REO) asset disposition programs for Fannie Mae, Freddie Mac and FHA. NAR, like many other housing related associations and organizations, submitted letters in response to the government’s request for information on how to deal with the REO problem. Continue reading “REALTORS offer suggestions to the Fed on how to deal with the REO problem

St. Louis foreclosures increase in August but are down sharply from a year ago

Dennis Norman, St Louis REALTOR - St Louis Foreclosures, St Louis REO'sSt. Louis foreclosure activity increased in August by 29.09 percent from July with 1 of every 682 St. Louis homeowners having a foreclosure filing according to RealtyTrac’s foreclosure market report that was just released.  As the chart below depicts, of the eight largest counties in the St. Louis metro area all but Madison County Illinois saw an increase in foreclosure activity in August with Macoupin County Illinois leading the way with a 113 percent increase.

To find foreclosures in your area click here. Continue reading “St. Louis foreclosures increase in August but are down sharply from a year ago

St. Louis homeowners with negative equity increases slightly in 2nd quarter

Dennis Norman St Louis

A report released today by CoreLogic shows that 17.30 percent (99,792) of all St. Louis homeowners with a mortgage were in a negative equity position in the second quarter of 2011, up slightly from 17.10 percent the prior quarter. Negative equity is also referred to as being “underwater” or “upside down” and refers to homeowners that owe more on their mortgages than the current value of their home. Continue reading “St. Louis homeowners with negative equity increases slightly in 2nd quarter

Foreclosure rate in St Louis decreases in June from month before but still up from a year ago

St. Louis REALTOR, Dennis Norman foreclosures

The St Louis foreclosure rates was 1.62 percent for June 2011, down from 1.71 percent the month before and up from June 2010 when the rate was 1.44 percent, according to a newly released data from CoreLogic. As usual, the St Louis foreclosure rate is significantly lower than the national foreclosure rate, which was 3.46 percent for June 2011. Continue reading “Foreclosure rate in St Louis decreases in June from month before but still up from a year ago