Ouch!  January’s numbers took a big plunge.  January’s median sold price dropped to $167,000.  That’s more than five percent off of December’s median sold price.

Similarly, the median sold price per square foot also experienced a large decline.  January’s $97.06 per square foot represents a four percent drop from December’s number, and also the first time we’ve seen the sold price per square foot fall below the $100 mark.

FWIW, January’s $97.06/square foot represents a 56 percent fall from the peak sold price per square foot of $223.06 reached in October 2005.  The latest median sold price of $167,000 is off 54 percent from the median high of $365,000 reached in January 2006.

To look at it another way, today’s median price of $167,000 has returned to 2001 levels.

The make-up of January’s sales is as follows:

• Bank-owned properties – 40%  
• Short sales – 35%  
• Equity sales – 24%

Short sale closings bumped up from 30 percent of December sales to 35 percent of sales in January.  Hopefully, this indicates quicker turnaround times for short sale transactions going forward.

For those readers who prefer the median sold price for houses and condos combined, January’s combined median sold price was $159,400; down 2.8 percent from December’s combined median of $164,000.

Note: The medians table above is updated on a monthly basis. The median home price data reported covers the cities of Reno, Nevada and Sparks, Nevada [NNRMLS Area #100]. Residential data includes Site/Stick Built properties only. Data excludes Condo/Townhouse, Manufactured/Modular and Shared Ownership properties. Data courtesy of the Northern Nevada Regional MLS - February 2010.

The Reno Sparks Association of REALTORS^® has published their year-end market reports for the Reno-Sparks and Fernley housing markets.

Click here for the Reno Year End 2009 Market Report.
Click here for the Fernley Year End 2009 Market Report.

Some points from the Reno report:

• Reno’s median price for year end 2009 was $185,000 down 26% from 2008.
• For the seven month period May 2009 – December 2009, prices have remained stable.
• The median home price is in line with the median household income in recent months for the first time since 2002.

In an effort to improve the wait times for the short sale approval process, Bank of America has named a new executive in charge of short sales and REOs.  From the press release: CALABASAS, Calif. – Matt Vernon, a 15-year veteran of the financial industry, has been named short sale and real estate owned (REO) executive for Bank of America Home Loans, moving to the loan servicing division from roles in the bank’s residential mortgage origination business.
 
In his new position, Vernon will develop and implement initiatives to manage and streamline the bank’s efforts to use short sales and other property liquidation tools to prevent foreclosures and oversee the management and marketing of properties in the bank’s real estate owned portfolio.

I guess it can’t hurt.

See the entire press release here: Matt Vernon Focuses on Efficient Service in New Role of Short Sale and REO Executive for Bank of America Home Loans

 -  January NOD/NOS/TD Figures - NODs totaled 778, up from 763 in December, basically pretty steady for the last 4 months.  NOSs totaled 394, up from 366 in  December, but again, generally even with the last four month average.  TDs fell to 190 from 221 in  December, the lowest total we’ve seen since April 2008.  I’ll resume my graph next month (note to self - free trials of Office 2007 will erase your old programs).

-  The first 3 days of February are off to a blazing start, with 182 NODs, 75 NOSs, and 25 TDs filed.  A large number of the NODs are from missed payments over a year ago.  There seems to be a pretty direct relationship between the amount owed and how long the lenders are waiting to foreclose (though BK filings by the wealthier contribute to this).

-  The amount owing on the NODs is trending up rather dramatically.  Of the 54 NODs filed today, 6 were for over $1,000,000 (3 in IV, 2 ArrowCreekish, and 1 Caughlin).  Another 8 or so were in excess of $500,000.

-  Dine and Dash - No one really knows how many people are purchasing a new, cheaper home before defaulting on their underwater residences, but I can assure you that from my research that these are not isolated occurrences anymore.  Most of the cases I have run into to have been average Joe’s who wouldn’t generally have the real estate savvy to execute these deals.  I believe they are being "coached". 

- TD to TD - There are people losing properties at Trustee’s Sales that are turning around and BUYING properties on the courthouse steps for cash, sometimes within a week or two.  This is not wide spread yet, but is raising my blood pressure to apoplectic levels.  The lenders need to get off their boney asses, do some due diligence,  and start setting some very public examples that fraud is not acceptable.  Give me deficiency judgments!  Give me public humiliation, flogging on Victorian Square, the Scarlett R.  100%, each, every, ALL of the cases I have found of people losing properties then turning around and paying CASH for Trustee’s Deeds are all in the industry.  That’s RE brokers, agents, bankers, developers, title and mortgage folks.

I’m just not in an "up" mood for Reno tonight.

I’ve just received the following email from one of my local lender contacts.  This is an interesting development regarding FHA underwriting guidelines.  Check it out…

If your buyer had a short sale 3 years ago, and can document that the short sale was the result of a verifiable financial hardship (death of a spouse, loss of a job that forced a move, a divorce, etc..), then FHA is allowing for this buyer to obtain financing for a new home, on a case by case basis.  Using this 3 year rule they would also be eligible for the 1^st time home buyer credit.

I do not believe that an increase in interest rate would be an acceptable financial hardship.

This is the first indication that I have seen that there maybe some leeway being given to those people who found themselves losing their home to circumstances beyond their control.  The challenge here is the fact that this is going to be decided on a case by case basis so until a file is underwritten we will not know whether the loan can be approved. 

On January 1, 2010 new RESPA rules regarding the mandatory use of the revised Good Faith Estimate and HUD-1 Settlement Statement went into effect.

I have been hearing from my contacts in the lending and title professions that these new rules are complicated and open to interpretation.  The net effect is that the escrow process has slowed causing delays in the close of escrow.

And a shifting close of escrow date is not good for any of the parties involved; from the Buyers attempting to line up a moving truck to the short sale lenders demanding that the original COE date be met.

The following tips for dealing with the new RESPA rules are presented by our friends at Ticor Title.  Though directed to real estate professionals, I think buyers and sellers will find them of interest.
 

Effective January 1, 2010, the new RESPA rules regarding the mandatory use of the new Good Faith Estimate and HUD-1 Settlement Statement are in effect.

Starting today the Federal Housing Administration is revising its long-standing 90-day anti-flipping rules.

For much of the past decade the FHA’s 90-day anti-flipping rule went like this: if the seller had owned a property for less than 90 days, then the FHA would not insure a new mortgage for the buyer. The ban was imposed to prevent fraudulent quick flips of houses.

The FHA is now suspending this policy for at least the next year. One of the goals of the new policy is to speed up sales of renovated houses (i.e. foreclosures) to first-time buyers and other purchasers.

Read the Washington Post story here: To boost sales of foreclosures, FHA suspends anti-flipping rules

If you enjoyed Diane’s post about the difficulties she encountered in trying to get her lender to approve a short sale offer on her property (see Short Sale FAIL), then you may find this account (from the front page of this morning’s RGJ) of a woman’s attempt at a loan modification good reading: Local homeowners get the runaround on loan modifications

The print edition of this story also contained tables showing success rates of loan modifications by lender, and stats on Nevada loan modifications and repayment plans.  [Note: I am presently trying to get permission from the RGJ to reprint the table.  If I do, then I’ll update this post.]

UPDATE: Thank you you to the RGJ for permission to reprint the table below.

Source: Reno Gazette-Journal

If anyone has a loan mod experience (successful, or otherwise) he or she would like to share with the blog, please comment below.  I’d love to hear your story.

One takeaway from the RGJ story is that homeowners in default should consider the Nevada Foreclosure Mediation program. According to the side notes for the article “the program has received nearly 3,900 requests in its first six months, or more than 10 percent of Nevadans facing default.  So far, 1,821 mediation requests have been assigned to a mediator and 877 mediations have been conducted.”

What is going on at the Montage?  Their website hasn’t been updated, there hasn’t been a lick of marketing from the new owners, no one seems to know what the new pricing structure (if any) is going to be, and I’m not sure that you could buy a unit in the building if you wanted to.  You certainly couldn’t finance it in this climate.

The first attempted resale of a unit at the Montage has faced a rocky road.  Unit 2018 is a 1519 SF 2 bedroom, 2 bath unit with 2 car tandem parking.  It is in the prime stack of the building.  It was purchased on 29 May 2009 for $445,900 for cash.  I don’t know if this is one of the units Montage had under contract - I’ve heard that the majority of the 33 buyers have been new meat.  The unit listed for $399,000 on 19 December, was reduced to $349,900 on 28 December, was reduced to $299,000 at some point according to some of the RE sites, then showed up as a featured property in the RGJ’s HomeFinder supplement yesterday listed at $200,000.  The sellers are said to be "incredibly motivated" according to their realtor.  Job relocation forces sale.

I often disagree with smarten on his fixation on property tax issues, but not on this one.  Annual taxes on this unit are $5223.18, abated from $5622.00.  That is over $435 a month.  Add that to the monthly HOA dues of about $650, and add some insurance and utilities, and the the monthly cost of this unit is topping $1200 without a mortgage.  Rents out at $1500 or so?  Is the Montage approaching the Grand Sierra’s negative cash flow if free metric?

That said, at $200K for a prime unit in a prime building, do you bite and deal with the risk?  If I were liquid (and they accepted dogs over 30#), I think I would take the dive on this one.

The IRS has published an informational hand-out on the first-time homebuyers credit.  This doc states the qualifications and timelines in an easy-to-understand piece.  Check it out here: Important Information About The First-Time Homebuyer Credit