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I have read several news and Blog pieces about 2012 being the bottom of the market and how the best time to purchase a home is now. In good conscious I cannot sit idly by without voicing my opinion.

The news and columnists have based their analysis on the low number of inventory currently on the market for sale and the fact that it is 22% less than this time last year. They further site a 30% increase in property searches on Realtor.com which is one of the top search websites where consumers make purchase decisions. The reporters further substantiate their point by stating that interest rates are the lowest they have been since the great depression. Well folks, I am here to let you in on a few things. I am a distressed property real estate broker and live in the numbers and happenings on the ground. Last year alone I personally closed $17 Million in real estate. More than three quarters of my sales were short sales and bank owned property sales. My job revolves around tracking properties that have defaulted on their mortgage payments and listing the property for sale before it ends up in foreclosure. When properties do end up going to foreclosure the banks also contacts me to sell the properties back into the marketplace as a bank owned property. This is also known as a REO (Real Estate Owned) property.

In dealing with the lenders on a daily basis I have the ability to see how many mortgages are current or behind in any part of California. The numbers are staggering! One in three properties in San Diego County is currently underwater (owe more than what the property is worth).
Many of you may have heard of the “Mortgage Debt Relief Act of 2007” which is set to expire at the end of 2012. This means that anyone wanting to do a short sale has until the end of this year to get it done to avoid the enormous tax and deficiency implications. As homeowners scramble to do short sales, the banks are absolutely inundated with files. Banks have increased their loss mitigation departments to handle the amount of short sale requests as the deadline draws near.

So to shed further light on the subject of a “recovery,” I would have to say that the reason there is a 22% decrease in inventory on the market for sale is due to the “Robo-signing” debacle which simply held up the foreclosure process for a few months. Furthermore, the lenders have started issuing three month extensions to foreclosure sale dates rather than the standard 30 day extensions. The numbers are artificially adjusted to modify the supply and demand ratio. Also, the news columnists have stated that the average nationwide sales price has started increasing and the market is recovering. This is not quite correct because the number of higher end distressed sales has dramatically increased. In other words, if 100 homes sell at $200K and 900 homes sell at $500K, the average home price may have increased.  However, what they are not saying is that the home that is currently selling at $500K was purchased in 2005 for $900K.  See how they are messing with the numbers. Just because the average nationwide sales price has increased, does not mean we are recovering.

So I would maybe agree that the lower end has reached the bottom whereas the middle and higher end have room to fall.  Far be it from me to state that 2012 is the “Big Housing Recovery.” New young families or recent college graduates will also add to the lower end recovery as they will need to purchase in this range.

The number of Baby Boomers now wanting to downsize will further hamper the prices of the middle and higher end as they add to the supply. There are currently 30 million Americans in this segment of the market.

The FED made an error in judgment a month ago when they stated interest rates would remain low through the end of 2014, which took away the immediate driving force to purchase now. If interest rates would remain low for an extended period of time, why would anyone be in a hurry to purchase when they know how much shadow inventory the lenders are sitting on?

As the world has become a global economy, few have shed light on the fact that China has begun their housing crisis with more than half the cities reporting huge decreases in home prices. This may have an influence on our economy further down the road as this may affect the cost of consumer goods locally.

Gas prices are at an all-time high and could further contribute to inflation and gyrations in the consumer price index.

Unemployment is still stubbornly above 8% and steam rises from the printing presses at the Fed.

I don’t know folks. Recovery 2012?  I am not so sure. And over the years I have learned that in the long run it pays to be honest rather than bending a situation for personal gain. There is a reason I am renting right now. Though the rents are higher, cash will soon be back on the thrown to be crowned King. Don’t be in any hurry to purchase unless you find a great deal.

This is my honest humble opinion.

Started one on Equator first part of December. Seemed plausible. Then went to HELD status.

Called in several times in regards to HELD status.....Customer service reps kept saying all looks good, yes we have everything, negotiator is working on it....

NOD had been filed unknown to me when I took the listing. Nothing showed up in Foreclosure Radar. Title company did not see anything. (Seller forgot to tell me the letter came in after I put on MLS) OOPS!

In either case, multiple phone calls to negotiator as well as emails and to his manager and no response. Every time I called Equator everything was peachy keen.

Then a week ago monday I found out about the Trustee sale, called the title company again, who for some reason did not see it right away but eventually found it and emailed foreclosure radar as to status since they did not show anything---they finally found it, and updated their system....told me there was nothing else I could have done has they had to have their plant do a thorough research before they even found it........sigh.......Title company had to research it several times........I do know there is a backlog due to layoffs and hours cut back at the county .....perhaps part of the mayhem.......

So since the negotiator was over 6 weeks late in completing task with two escalations I emailed the office of the president. They responded promptly assigned a new negotiator this week BUT the investor will not call her back but she did look at notes and the investor will not accept anything below a certain amount.........fine except the comps do not justify that amount. Negotiator tells me on thursday the 12th ,wants buyer to raise offer to price investor indicated in notes (I think these notes are from the prior offer!) Which tells me that the first negotiator DID NOT properly send in my new information.

The 2nd negotiator kept asking me you are not the original agent ? NO, I am not.

Buyer says no to increase in purchase offer, cancels.(WILL stay in if the offer is accepted at price originally provided)

Backup offers will not go that high.......comps do not justify.

Oh , did I mention the trustee sale is this coming tuesday the 16th?

Background of this condo, seller had listed with another agent approx year ago who had offer rejected by BofA.

Again, appraisals were not based upon the current market value of several of the units sold in this particular complex but compared to luxury condos elsewhere.

Seller, starts communication with bank and tries to work something out and calls me in November to relist as short sale again.

BofA was given all of this info upfront and that I was a different agent and agency.

Instead of just letting us know up front and/or giving us the amount they would accept they allowed 3 months to go by and wasted everyones time and efforts. (The homeowner by the way, has kept up their HOA fees )

So to BofA I say this-You wonder why agents think poorly of you? Go back and read above.....simple communication at the onset could have avoided the lengthy wait.......Playing games and instructing your customer reps to mispresent the facts is inexcusable.

The majority of realtors and agents try to operate in fair play and expect the same back.

I do not think Equator is a bad thing...I even took the ReoTrans Gold Certification...it does have some bugs and if you get lost up front in the system it is hard to rebound. In fact, the recent conversations I have had with the powers to be suggested the same thing. I know of several agents who have closed transactions. That is a good thing.

When you call in and ask specific questions and are led to believe that all is peaches and creme I really take exception to such......It has nothing to do with the thousands of short sales you state you have......Regular short sale dept would not talk to you as it was loaded in equator.

It has everything to do with proper training, communication and honesty and letting the investor know up front an offer that came in and not wait til the very end to let the investor know about an offer ... particularly after NOD was filed.

Plain and simple......let the listing agent know the facts up front and not dump on them at the very end.

Please know I have closed several BofA transactions....the longest took up to 9 months.

Now someone tell me about all of the negotiators that are buddy buddies with various investor groups who hs a special relationship with various investor groups to come in waaayyyy below market value and close the short sale? I understand some of these negotiators make bonuses working these various investors......