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December, 2009 - Newsletter for the Maui Market
Aloha & Mele Kalikimaka! Here is your eNewsletter for the Maui Market from Jim Foster
Hot Buys for December, 2009 - Kaanapali Royal 2 bedroom units G101 $685,000 & G201 $825,000 (totally remodeled) 1,534 square feet concrete air conditioned; Kahana Reef 1 bedroom on ocean, 611 square feet concrete building $439,000; Kahana Sunset 2 bedroom unit 952 square feet $795,000; Kapalua Golf Villas 2 bedroom unit 1,440 square feet $550,000; Lahaina Shores studio, fee simple 483 square feet $236,000 (FS); Mahana right on the beach, studio 456 square feet $515,000, 2 bedroom unit (total remodel) $1,945,000; Maui Eldorado with private cabana on Kaanapali Beach, studio $249,000 (LH); Maui Kaanapali Villas on Kaanapali Beach 1 bedroom unit with 920 square feet $475,000; Pohailani studio direct oceanfront with 363 square feet $310,000; Puna Point 1 bedroom with 678 square feet $998,000.
For a complete list of REOs and Short Sales in West Maui or the entire island send email request to Jim@JamesBFoster.com
Residential Short Sales - 1) 33 Kahana Ridge Drive $725,000; 2) 1406 Front St $995,000; 3) 300 Alii Way $1,395,000; 4) 9595 Punakea Loop $1,749,000; 5) 136 Hakui Loop $1,950,000.
Residential REO - 1) 5 Iris Place Kahana Ridge $665,800
Land Short Sales - 1) Lanikea Subdivision - 12,081 SF Lot $405,000 & 12,062 SF Lot $495,000.
Land REO - 1) Summit Subdivision - 11,892 SF Lot $449,000; 2) Lanikea Subdivision - 12,628 SF Lot $450,000; 3) Lanikea Subdivision - 40,816 SF Lot $850,000; 4) Kapalua area with almost 11 acres of mainly useable land with spectacular sunset, ocean, Molokai and mountain views Sellers have completed substantial steps toward obtaining entitlements for a 10 lot subdivision $3,000,000.
Condo Short Sales - 1) Kahana Reef 1 Bd $395,000 2) Valley Isle Resort 1 Bd $519,000; 3) Whaler Studio $449,000
Condo REO - 1) Lahaina Roads 1 Bd $383,700
You can now search on my web site www.JamesBFoster.com the Short Sales & REOs on Maui in the MLS. Email me and I will email you back the instructions on how do to do the search. There are a substantial number of Short Sales and REO properties for sale in the Maui Realtors Association Multiple Listing Service (MLS) and the number is increasing and if you would like to have a list or are interested in these types of properties send an email to Jim@JamesBFoster.com
New IDX Search Features - on www.JamesBFoster.com Search properties and you can search for Short Sales, REOs, by location and other categories. If you would like directions on how to use email me Jim@JamesBFoster.com and I will email instructions.
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Make sure you check out the Useful Internet Sites and Real Estate Tips at the end of this newsletter.
Don't forget! We provide a free Automatic E-mail Notification Service that goes out to recipients whenever a new listing becomes available for a particular condominium complex. Each of these notifications includes a link to view the details of the brand new listing in the MLS. We DO NOT SHARE YOUR EMAIL ADDRESS or your contact information with anyone. To subscribe to our Automatic E-mail Notification Service, please send Won an email at Won@JamesBFoster.com with your first and last name, your email address, and the condominium property you wish to be notified of.
Maui Real Estate - As Reported by the Realtor’s Association of Maui (RAM) - The November's Sales Volume for Residential Sales dipped slightly from October, however they were the second best month of the last 12 months. Condo Sales rose in November to 69 units and Land sales rose to 17 (including 5 Mixed-use lots in Maui Lani Village Center). The November's Median SALES prices for Homes slipped to $465,000 while Condos remained steady at $400,000. Land bumped up to $450,000.
The Days on Market (DOM) for Residential homes = 168 DOM, Condos = 192 DOM, Land = 284 DOM. (General DOM Note: this is the average DOM for the properties that SOLD. If predominantly OLD inventory sells, it can move this indicator upward, and vice versa. Also, RAM's Days on Market are calculated from List Date to Closing Date [not contract date]. As such, it includes approximately 60 days of escrow time.)
Also - Short Sales transactions can often take 4-6 months to close thereby extending the marketplace’s average DOM. The "Year to Date Sales" numbers compare January/November 2009 to January/November 2008. Short timeframe (monthly) views do not necessarily reflect the longer timeframe trends. The Year to Date: Residential unit sales declined (-31%), average sold price = $718,603 (-14%), median price = $500,000 (-14%) and total dollar volume sold = $423,975,910 (-41%). Condo unit sales declined (-1%), average sold price = $711,789 (-23%), median price = $464,500 (-16%). Total Condo dollar volume sold = $529,570,658 (-24%).
Land - Note: Land Lot sales are such a small sampling that statistics in this property class are not necessarily reliable indicators. Land lot sales declined (-3%), average sold price = $1,163,312 (+20%), median price = $500,000 (-29%), Total dollar volume = $116,301,185 (+24%). Also, total sales for immediately past 12 months: Residential = 646, Condo = 780, Land = 101.
In a nut shell...... the good, the bad….. and the road ahead ……Inventory continues to shrink since April ’09. Similar to latest reports from many mainland markets, our market seems to be getting its footing. The large inventory includes many short sales and REO (bank owned) properties which will need to be absorbed as sales before we can move ahead to a more normal marketplace.
For Sellers: Sellers who don’t really need to sell (just “fishing?”) should stay off the market, and clear the marketplace for those who really have to sell. To be successful, Sellers need to be realistic and beat competing properties with better property condition, realistic pricing, good marketing, and flexible, creative terms (including lease-with-option-to-buy and sale-with-lease-back to seller). Days on Market figures show that properties priced right will sell in a reasonable timeframe. “Priced Right” is still the determining factor. Best Deals are selling, everything else is getting old. Pro-Active Sellers are getting their properties appraised, inspected and surveyed in advance to encourage knowledgeable offers from realistic Buyers. Doing this can prevent unanticipated escrow fallout. Unrealistic Sellers continue to be ignored by the market and miss current opportunities that later become woefully apparent. They may even end up in a Short Sale or Foreclosure situation that could have been avoided.
For Buyers: Continued low interest rates and Newly Extended first time/move-up homebuyer incentives provide plenty of options for Buyers who qualify. Buyers should get Pre-Approved so they can shop in confidence (fewer last minute disappointments due to non-funding loans). More "short-sales" and foreclosures are happening in the marketplace, yet they can be less of a bargain than they seem, requiring more hurdles to leap and more time (often 4-6 months) to close, if at all. Be prepared, but be realistic.
To view the 2007 & 2008 and 2009 Jan through Nov Year End Statistics go to http://www.jamesbfoster.com/condosales.php and click on Maui MLS Statistics 2007, 2008 and the month ending November, 2009.
The West Maui real estate market continues to favor Buyers with Sellers willing to negotiate their prices. We are either at the bottom or will be in the next three to six months. Once the bottom is achieved prices will likely remain at that level for six to nine months before changing direction. Buyers in the market currently, for the most part, are looking for deals or the lowest prices. We are seeing improvement in the number of showings and increased bookings for vacation rental. The current inventory of West Maui condominiums for sale is now at 629 (at 12/4/09) and on the same month in 2008 it was 739 and this is an improvement with inventory going down. Properties are requiring more time to sell such as five to six months and Buyers have a much larger inventory of properties for sale to choose from. If you’re curious about current trends in Maui real estate and where the market is headed, the answer is - it depends on Location - it depends on if it is condominium or single-family residential - it depends on whether you look at volume, average or median prices. In the current Maui real estate market, the for sale inventory continues to increase and prices are typically flat or have decreased.
Condominiums for Sale
2007 - In the West Maui real estate market, at the beginning of January, 2007 there were 410 condominiums listed for sale with the total value of $372,238,031.00; February, 2007 - 431 condos with the total value of $393,681,669.00; March, 2007 - 458 condos with the total value of $420,941,268.00; April, 2007 - 479 condos with the total value of $429,708,159.00; May, 2007 - 472 condos with the total value of $424,095,260.00; June, 2007 - 455 condos with the total value of $415,187,129.00; July, 2007 - 475 condos with the total value of $432,797,008.00; August, 2007 - 469 condos with the total value of $420,479,301.00; September, 2007 - 474 condos with the total value of $430,914,408.00; October, 2007 - 471 condos with the total value of $423,631,002.00; November, 2007 - 466 condos with the total value of $416,008,907.00; and December, 2007 - 485 condos with the total value of $421,080,117.00. The average number of condominiums for sale on West Maui for 2007 was 462 and the average total value was $416,730,118.25.
2008 - At the beginning of January, 2008 there were 511 condominiums listed for sale with the total value of $445,656,447.00; February, 2008 there were 559 condos with the total value of $500,946,603.00; March, 2008 - 595 condos with the total value of $529,779,322.00; April, 2008 - 647 condos with the total value of $606,635,687.00; May, 2008 - 634 condos with the total value of $583,391,821.00; June, 2008 - 644 condos with the total value of $590,736,279.00; July, 2008 - 680 condos with the total value of $662,919,268.00; August, 2008 - 703 condos with the total value of $693,069,348.00; September, 2008 - 693 condos with the total value of $654,411,079.00; October, 2008 - 673 condos with the total value of $620,032,454.00; November, 2008 - 715 condos with the total value of $652,379,032.00; and December, 2008 - 729 condos with the total value of $660,335,998.00. The average number of condominiums for sale on West Maui for 2008 was 648 and the average total value was $604,191,111.50.
2009 - At the beginning of January, 2009 there were 742 condominiums listed for sale with the total value of $693,143,047.00; February, 2009 there were 757 Condos with the total value of $709,234,346; March, 2009 there were 787 Condos with the total value of $681,864,289; April, 2009 there were 805 Condos with the total value of $693,368,793; May, 2009 there were 717 Condos with the total value of $629,812,465; June, 2009 there were 691 Condos with the total value of $591,075,527; July, 2009 there were 692 Condos with the total value of $588,385,017; August, 2009 there were 682 Condos with the total value of $575,359,815; September, 2009 there were 662 Condos with the total value of $540,291,317; in October, 2009 there were 662 Condos with the total value of $527,367,912; in November, 2009 there were 636 Condos with the total value of $486,410,609; and in December, 2009 there are 629 Condos with the total value of $495,645,642. The average number of condominiums for sale on West Maui for 2009 is 705 and the average total value is $600,996,564.92.
The condominium for sale inventory since July, 2005 has been as low as 165 and was up to 805 in April, 2009 with the currently inventory of 629 on December 4, 2009.
Condominium Sales
2006 - The total condominium sales on West Maui during the month of January, 2006 there were 42 sales and the total value was $28,574,643.00; February, 2006, there were 48 sales with total value of $32,995,078.00; March, 2006 - 40 sales with total value of $32,199,584.00; April, 2006 - 43 sales with total value of $41,898,525.00; May, 2006 - 51 sales with total value of $39,644,886.00; June, 2006 - 40 sales with total value of $32,533,500.00; July, 2006 - 30 sales with total value of $26,212,000.00; August, 2006 - 28 sales with total value of $31,885,500.00; September, 2006 - 30 sales with total value of $24,770,000.00; October, 2006 - 29 sales with total value of $23,359,299.00; November, 2006 - 22 sales with total value of $13,414,600.00; and December, 2006 there were 30 sales with total value of $23,169,999.00. For 2006, the monthly average sales were 36 sales per month with the average sales value of $29,221,467.83 per month.
2007 - The total condominium sales for West Maui during the month of January, 2007 there were 37 sales and the total value was $33,091,000.00; February, 2007 there were 26 sales with total value of $16,330,000.00; March, 2007 - 32 sales with total value of $24,121,000.00; April, 2007 - 27 sales with total value of $16,766,000.00; May, 2007 - 28 sales with total value of $30,774,929.00; June, 2007 - 28 sales with total value of $18,917,000.00; July, 2007 - 21 sales with total value of $13,314,200.00; August, 2007 - 32 sales with total value of $33,258,999.00; September, 2007 - 23 sales with total value of $24,701,900.00; October, 2007 - 42 sales with total value of $28,159,900.00, however this included a packaged sale of 19 units at Aina Nalu in Lahaina; November, 2007 - 15 sales with total value of $15,930,000.00; and December, 2007 there were 13 sales with total value of $13,335,500.00. For 2007, the Month of December saw the lowest number of sales in 2007. The monthly average sales were 27 sales per month with the average sales value of $22,391,702.33 per month.
2008 - The total condominium sales for West Maui during the month of January, 2008 there were 20 sales and the total value was $16,184,800.00; February, 2008 there were 20 sales and the total value was $14,414,584.00; March, 2008 - 26 sales and the total value was $20,079,000.00; April 2008 - 28 sales and the total value was $20,488,500.00; May 2008 - 22 sales and the total value was $20,055,000; June 2008 - 14 sales and the total value was $11,957,000; July 2008 - 10 sales and the total value was $6,955,999; August 2008 - 13 sales and the total value was $8,055,000; September 2008 - 12 sales and the total value was $6,707,122; October 2008 - 12 sales and the total value was $8,042,500; November 2008 - 10 sales and the total value was $8,444,000; and December 2008 there were 6 sales and the total value was $6,265,000. For 2008, the average monthly sales were 16 sales per month with the average sales value of $12,304,042.08 per month.
Condominium Sales in 2009 - The total condominium sales for West Maui during the month of January, 2009 there were 76 sales and the total value was $95,573,286.00; February, 2009 there were 54 sales and the total value was $68,795,841.00; March, 2009 there were 37 sales and the total value was $32,979,595.00; April, 2009 there were 23 sales and the total value was $13,142,872.00; May, 2009 there were 11 sales and the total value was $8,879,500.00; June, 2009 there were 18 sales and the total value was $12,530,000.00; July, 2009 there were 28 sales and the total value was $30,196,900.00; August, 2009 there were 25 sales and the total value was $17,891,397.00; September, 2009 there were 14 sales and the total value was $5,684,550.00; October, 2009 there were 23 sales and the total value was $14,202,856.00; and November, 2009 there were 19 sales and the total value was $9,850,550.00. From January 1, 2009 to November 30, 2009, the average monthly sales were 30 sales per month with the average sales value of $28,157,031.55 per month.
The West Maui Condominium sales in 2009, has been adjusted to accommodate the reported sales at the Honua Kai Beach Resort located in Kaanapali, which were recorded late in to the Maui MLS.
We have gone in to the Maui MLS database and pulled information for 2000 through 2008. In 2000 - 654 condominium units sold in the West Maui area for a total value of $209,064,010; in 2001 - 605 condominium units sold for a total value of $271,681,337; in 2002 - 730 condominiums sold for a total value of $240,178,915; in 2003 - 737 condominiums sold for a total value of $319,748,466; In 2004 - 700 condominiums sold for a total value of $375,033,467; in 2005 - 682 condominiums for a total value of $408,582,315; in 2006 - 435 condominiums for a total value of $351,782,614; in 2007 - 327 condominiums for a total value of $271,290,428; in 2008, - 193 condominium units sold for a total value of $147,648,505; and from January 1, 2009 to November 30, 2009, - 328 condominium units sold in the West Maui area for a total sales value of $309,727,347.00.
If you would like to view the most current sales statistics for Maui or West Maui Condominiums, you can go to my web site www.JamesBFoster.com and click on Condo Sales in the upper left corner of the home page or go to www.JamesBFoster.com/condosales.php
Mortgage Rates for week of December 1, 2009 - from First Hawaiian Mortgage - Rates: Houses & Condos Full docs: 4.500% 30yr fixed 1.875pts (4.743 APR) 4.750% 30yr fixed 1.000 pts (4.918 APR) 5.000% 30yr fixed -0- pts (5.081 APR) Stated Income - No longer available: Interest Only To $625,500: 5.375% 30 yr fixed (10/20)1.000pts (5.530 APR) Interest Only to $1M: 5.500% 30 yr fixed(10/20) 1.000pt (5.589 APR) Condotels 5.875% 30 yr fixed 1.500 pts (6.079 APR) (Points include origination fee)
Mortgage Rates for week of November 1, 2009 - from First Hawaiian Mortgage - Rates: Houses & Condos Full docs: 4.750% 30yr fixed 1.625pts (4.974 APR) 5.000% 30yr fixed .50 pts (5.126 APR) 5.250% 30yr fixed -0- pts (5.332 APR) Stated Income - No longer available: Interest Only To $625,500: 5.500% 30 yr fixed (10/20)1.50 pts (5.698 APR) Interest Only to $1M: 5.750% 30 yr fixed(10/20) 1.500 pt (5.898 APR) Condotels 6.000% 30 yr fixed 2.125 pts (6.291 APR) (Points include origination fee)
Mortgage Rates for week of October 1, 2009 - from First Hawaiian Mortgage - Rates: Houses & Condos Full docs: 4.750% 30yr fixed 1.625pts (4.974 APR) 5.000% 30yr fixed .50 pts (5.126 APR) 5.250% 30yr fixed -0- pts (5.332 APR) Stated Income - No longer available: Interest Only To $625,500: 5.500% 30 yr fixed (10/20)1.50 pts (5.698 APR) Interest Only to $1M: 5.625% 30 yr fixed(10/20) 1.625 pt (5.766 APR) Condotels 6.000% 30 yr fixed 1.875 pts (6.186 APR) (Points include origination fee)
Mortgage Rates for week of September 1, 2009 - from First Hawaiian Mortgage - Rates: Houses & Condos Full docs: 4.750% 30yr fixed 2.250 pts (5.031 APR) 5.000% 30yr fixed 1.000pts (5.171 APR) 5.250% 30yr fixed -0- pts (5.332 APR) Stated Income - No longer available: Interest Only To $625,500: 5.625 30 yr fixed (10/20) 1.00pts (5.783APR) Interest Only to $1M: 6.125% 30 yr fixed(10/20) 1.125 pt (6.301 APR) Condotels 6.125% 30 yr fixed 2.25 pts (6.430 APR) 6.375% 30 yr fixed 1.375 pts (6.598 APR) (Points include origination fee)
Some recent and past news about what is going on in Maui & Hawaii
Weather - As I am writing this newsletter today, December 6, 2009, it is about 82 degrees and partly cloudy and a beautiful Maui day and the predicted high in the next four to five days is 84 degrees. Evenings are cooler, making sleeping very comfortable with the windows open. Maui weather is as near to perfection as you can get.
Maui Tourism Forecast Improves - The Chamber of Commerce anticipate the tourism will stabilize in 2010 and recovery by 2011. Speakers predicted a full-scale recovery should be in progress by 2011. Gregg Nelson, chairman of the board of the Maui Hotel and Lodging Association and also the general manager of the Napili Kai Resort, reminded the audience that there are always highs and lows in tourism. "We have been through downturns in the past, and we have recovered," Nelson told the assembly. "This is a lengthy one, but we need to remember we lag behind the U.S. Mainland by six months to a year. Taking a vacation is way down on people's list of things to do right now. They are worried about homes and jobs. It will be a while before we see signs of recovery." Conde Nast Traveler magazine readers have voted Maui the Best Pacific Island 19 years in a row and Best Island in the World 15 of the last 16 years. Maui just received both of those awards again last month. A recently completed survey by Web site vacation.com ranked Maui No. 1 as the place to have a dream vacation. Of the top five vacation spots in the United States, Maui has the highest average daily room rate. It is second only to New York in revenue per available room and Alaska Airlines and Air Canada have added direct flights to Maui and Alaska will add more from the Bay Area after the start of the year. The year of 2010 is expected to be a year of stabilization in the industry and 2011 should show a recovery. Maui’s biggest asset is its spirit of Aloha.
Maui Invitational NCAA men's basketball tournament - The direct economic impact of this tournament is approximately $8 Million and is now in its 26th year. During the tournament the was a substantial increase in retail traffic, auto traffic, restaurant sales, hotel and condominium occupancy. The Maui Invitational routinely brings in about 4,500 visitors from the Mainland for at least its duration, and many stay in West Maui hotels that sponsor the event, including the Sheraton Maui Resort & Spa, the Hyatt Regency Maui Resort & Spa and the Westin Maui Resort & Spa. The Maui Visitors Bureau pays tournament organizers an undisclosed amount to get the island's name on banners and the gym floor.
Hawaii among several locations luring Chinese - Hawaii, California and Las Vegas are among American tourist destinations vying fiercely for a vast and largely untapped new market segment. To lure the Chinese, the Hawaii Tourism Authority has budgeted a total of nearly $2.7 million this fiscal year for marketing there and in South Korea, said David Uchiyama, HTA's vice president of marketing. That includes $447,000 to participate in the World Expo 2010 in Shanghai, which begins in May. There are nonstop flights from Beijing and other Chinese cities to popular U.S. destinations, but Hawaii is not among them. Traveling to Hawaii usually means a stop at busy Narita Airport outside Tokyo. That could change next year if China-based Hainan Airlines follows through with plans to begin flying to Honolulu from Beijing nonstop. Even so, Hainan at first will fly only once a week to Hawaii. In comparison, Japan has about a dozen daily flights to the islands. ''Estimates are,'' Bischoff added, ''that the Chinese tourist market is one of our brightest increasing sources of tourists.''
Storm spawns first big winter swell for Maui - The big waves and the whales are back. At “Jaws”, remember the James Bond Movie, the waves tomorrow could be in the 40 foot to 50 foot variety.
Maui Land & Pineapple - A Loss of $25.5 million loss was reported for the third quarter of 2009 by ML&P. The loss includes $22.8 million in recorded losses on the company's investment in Kapalua Bay Holdings. On top of previous write-downs, that means the company now has lost all of the money it originally invested in the Kapalua Bay Residences venture. The latest report brings ML&P's total losses for the first nine months of 2009 to $92.9 million - larger than the $71.6 million loss the company recorded for the entire year in 2008. All sectors of the company saw operating losses in the third quarter of this year, but some lost less money than they did at the same time last year. The resort segment reported an operating loss of $2.7 million for the quarter - compared to losing $5.7 million for the same period in 2008.
Attorney in Lahaina - Gary Robert resides in West Maui and has been providing legal services here for over 30 years in Lahaina. His office is located at 808 Wainee Street, Suite 201, Lahaina, Maui, Hawaii 96761. To contact Gary - Tel: 808-667-7741
Fax: 808-667-7550 Email grlaw@hawaiiantel.net Web site www.garyrobertlaw.com
Business Law - Corporations, Partnerships, LLCs & Contracts.
Real Estate Law - Conveyances, Mortgages, Foreclosures, Landlord - Tenant, Partitions, Associations, Wills, Trusts, Probate, Family Law and Divorce.
Remodeling or Upgrading condominium or house - It is critical to have a licensed contractor and subcontractors with excellent references and experience working with Maui properties if you will be Remodeling or Upgrading a condominium or house Should you need assistance or referrals for a property you own or need an estimate for property you are contemplating purchasing, all Jim Foster on his toll free number 1-888-661-7994 or send him an email to Jim@JamesBFoster.com and we can provide names and contact information as we have contact information for several reputable contractors for both remodeling and new construction.
Installation of Home Entertainment Systems - If you are looking for an experienced company for Home Theater Systems, Whole House Sound Systems, Telephone & Computer Network Wiring, HD TV Specialist/Blu Ray, Complete Color Calibration System and Universal Remote Control Systems and much more - contact Jason Vizthum with Integral Technologies in Lahaina. Phone is 1-866-420-3013 and Cell is 808-214-4212. Licensed, excellent referrals and a West Maui resident. www.integraltechmaui.com Email for Jason integraltech@hawaii.rr.com
Medical Facilities on Maui - The Association for Improved Healthcare on Maui (AIHM) www.aihm-maui.org whose mission is to serve as an advocate for the creation of a system that will provide improved healthcare services to all of the citizens and visitors of Maui County has been making some excellent progress. For more information on making a contribution to this great cause, please visit the web site for AIHM at www.aihm-maui.org The new organization that is proceeding with Dr. Ron Kwon’s dream of a new hospital in Kihei is www.MalulaniFoundation.org To stay informed of what is transpiring with future approvals of either the Kihei or West Maui hospital, you can send me an email and request a subscription to the “Coconut Wireless” to either my email at Jim@JameBFoster.com or Jan@SunshineRainbows.com
Real Estate & Financial Planning Tips:
Buyers need to understand REO and short sales aren't always bargains - Buyers today are looking for that great deal and the foreclosure, REO or short-sale property they are considering can be a bargain or a money pit. The properties may appear to be bargains, but in many cases you could be buying someone else's problems. Some key issues to consider before buying:
What is your time line for purchasing? You may find a great short-sale property, and the seller may accept your offer but then the challenge begins and you don't have a deal until the bank approves the short sale. At many large lenders a single processor may have up to 500 files on his or her desk at one time. Realtors are reporting that it can take six or more months to get an offer approved. The wait can be extremely frustrating. It can also be costly. If prices are still declining in your area and price range, the offer you made six months ago may be too high and if you qualify for a loan now, will you still qualify six to eight months from now if mortgage interest rates have increased? More importantly, can you afford to make a higher monthly payment? If possible, search for a short sale or an REO where the bank has preapproved the sales price. It still may take a long time to close, but not as long as it would if the price was not preapproved.
Be prepared for a multiple-offer situation - With many buyers searching for distressed properties and the approval process taking so long, multiple offers are common. The lender will not tell you about other offers. They may, in fact, tell you that your offer will "probably" be approved -- but you cannot rely on this representation. If another offer comes in at a higher price and at better terms, the bank is obligated to take the best offer. If the property is a short sale, the seller's signature on the document merely opens the negotiation -- it does not finalize it. Furthermore, the seller/lender may continue to market the property even after they have signed a contract with you. This is simply smart business, as so many borrowers are having trouble closing transactions due to appraisal issues.
Inquire if the seller participated in the "Cash for Keys" program - Likely candidates for good bargains are those properties where the sellers are still occupying them. Many banks have a program called "Cash for Keys." This program pays the owners of foreclosure and short-sale properties money to keep the owner from trashing the property when they move out. I have seen copper piping ripped out of properties, concrete poured down the plumbing, and appliances stolen or destroyed. Cash for Keys is designed to minimize these behaviors.
Beware of vacant properties - Don’t purchase any property without doing a physical inspection. Also, if it takes more than 90 days to negotiate the transaction or if the house has been vacant, have the property re-inspected prior to signing off on the final deal. The reason for this is that the longer a house stays vacant, the more likely it is to have problems.
Is your lifestyle more important than the deal - A property can be a great deal but it worth it if it's in a poorly rated school district or if the commute is an hour from your workplace? What if the property has a terrible floor plan, is in the flight path for a major airport, or occasionally gets a whiff of the sewage treatment plant? When you purchase, it's important that you take all of these issues into consideration rather than focusing exclusively on the price. A property with any of these types of problems will be harder to sell in the future. It's important to consider the price in conjunction with the quality and the convenience of your lifestyle once you move in. For example, an extra 30-minute commute over a number of years can easily chew through thousands of dollars in terms of your vehicle costs, not to mention the wear and tear from the additional stress of commuting.
Remember, there are good distressed property deals out there but don't limit your search. Look at seller-occupied homes that are not distressed properties. Thirty-five percent of all properties are owned free and clear. These properties are often lovingly maintained, in top-notch condition, and in more desirable locations. In the long run, they may be a much better bargain than an REO or Short Sale situation.
We have assisted sellers (for sale by owners) who had buyers but needed someone to facilitate the sale and guide them through the process and assure them they were asking a current market value price for their properties.
Many property owners who currently own underperforming assets can sell those assets and take advantage of tax deferred exchanges, turning an underperforming asset such as land into an income producing asset. If you are contemplating selling highly appreciated real estate during 2009 or 2010 and would like for us to provide an analysis of how to best structure your transaction, please call me or send me an email if you would like additional information at 808-661-7994 or email Jim@JamesBFoster.com
Useful Internet Sites & Interesting DVDs:
www.getdropbox.com Are you tired of having your email provider bounce the message with files attached because the large files exceed its protocols. This neat service lets you set up a folder on your desktop at home plus folders on any other computers you use -or even on your iPhone. Getting files from one computer (or phone) to the other is as simple as dragging a file between folders on your computer. You can also get access to all of your files when you are on the road (even without your computer) from your on-line folder set up with this service. And Grandpa can see your photos instantly. This web site and service has lots of additional bells and whistles at no cost.
www.birthdayalarm.com Did you just forgot a birthday or other special event that was very important to someone close to you? Use this web site’s service and it will never happen again. You’ll receive an e-mail reminder well before any special event you choose. There is no limit to the number of events you can choose and no charge for the reminder service. You will have access to a wide range of greeting cards and other services at a modest cost. They have 52 million members so it must be working
www.fansnap.com If you "must see" event coming to town - a great play—the sporting event of the century - a "can't miss" concert? Then you need to stop by this ticket/event search engine! The numbers change from day to day, but generally at any one time you can search in the range of 11 million tickets to over 30,000 separate events. Once you find the tickets of your dreams you can chose you seats and purchase the tickets directly from the ticketing site. These folks take away the time and grief of traipsing all over the web by centralizing your search to this one great place.
http://video.pbs.org If you are a fan of the Public Broadcasting System (PBS) (or want to be) then this is a very worthwhile place to visit. Frontline -- Masterpiece Theater -Nova -- American Masters -- this great place has full length videos at your fingertips - on demand! You can watch your favorite shows and catch any episodes you may have missed -- all on your schedule. You can also send your favorites to friends and post them to social networks. There is no cost but if you are not a member of your local PBS affiliate you should become one as it is the highest quality of entertainment and a bargain price.
Interesting DVDs
My Sister’s Keeper - 2009 A former defense attorney (Cameron Diaz) finds herself back in the courtroom when she and her husband (Jason Patric) are sued for medical emancipation by their 11-year-old daughter, Anna (Abigail Breslin), who is expected to donate a kidney to her dying older sister. The subsequent trial tests ethical boundaries and the limits of parental love. Joan Cusack and Alec Baldwin round out the cast in this powerful drama based on Jodi Picoult's novel.
Music of the Heart In director Wes Craven's inspiring Oscar-nominated drama -- which is based on a true story -- violinist and single mother Roberta Guaspari (Meryl Streep) struggles to convince the administration at an East Harlem high school to let her establish a music program. Having won that battle, Roberta nonetheless continues to face an uphill climb as budget cuts threaten her determined and deeply felt efforts to bring the arts to underprivileged kids.
A Dog Named Christmas Based on Greg Kincaid's best-selling novel, this heartwarming family film tells the story of one young man's passion for helping animals. Despite his developmental challenges, Todd McCray (Noel Fisher) is determined to find loving homes for dogs. Using his powers of persuasion, Todd enlists his rural neighbors to participate in a nearby animal shelter's Adopt a Dog for Christmas Program, with amazing results.
Kindest Regards, Jim Foster
Chase 'N Rainbows Real Estate, Inc.
Toll Free 888-661-7994
Direct Line 808-661-7994
Cell 808-870-5858
Fax 808-667-2957
Real Estate for Sale www.JamesBFoster.com
Vacation Rental www.ChaseNRainbows.com
Email Jim@JamesBFoster.com
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