
Archive for the 'Distressed sales' Category
July 1st, 2009, 3:00 am by Mathew Padilla
Steve Thomas at Altera Real Estate in Aliso Viejo reports that the number of O.C. distressed properties (homes listed by agents as foreclosures or short sales) was 2,919 last week, down 143 vs. two weeks earlier or a 4.7% decline.
Since Dec. 26, the number of distressed homes on the market has dropped 46% while the non-distressed supply is 22% lower.
As a percent of all listed homes for sale, distressed properties were 31.8% of the market last week vs. 32.9% two weeks earlier. For a look at housing demand, read: Demand for O.C. homes hits plateau.
Here’s a look at various slices of the O.C. market as of last Thursday: total inventory listings; distressed property listings; and the share distressed listings have of total inventory supply on a percentage basis in each niche …
| Slice |
All inventory |
Distressed |
Share |
| By price … |
|
|
|
| • O.C. $0-$250k |
1,488 |
846 |
57% |
| • O.C. $250-$500k |
2,274 |
1,281 |
56% |
| • O.C. $500k-$750k |
1,669 |
461 |
28% |
| • O.C. $750k-$1m |
1,093 |
182 |
17% |
| • O.C. $1m-$1.5m |
1,012 |
93 |
9% |
| • O.C. $1.5m-$2m |
581 |
33 |
6% |
| • O.C. $2m-4m |
769 |
23 |
3% |
| • O.C. $4m+ |
398 |
4 |
1% |
| All O.C. |
9,188 |
2,919 |
32% |
| • Attached |
3,519 |
1,448 |
41% |
| • Detached |
5,656 |
1,461 |
26% |
| County high share |
|
|
|
| • Santa Ana |
595 |
442 |
74% |
| • Foothill Ranch |
32 |
23 |
72% |
| • Garden Grove |
220 |
146 |
66% |
| • Anaheim |
402 |
262 |
65% |
| • Buena Park |
102 |
65 |
64% |
| • Rancho Santa Marg. |
111 |
70 |
63% |
| • La Habra |
105 |
64 |
61% |
| County low share … |
|
|
|
| • Seal Beach |
296 |
3 |
1% |
| • Laguna Woods |
432 |
16 |
4% |
| • Corona Del Mar |
228 |
11 |
5% |
| • Laguna Beach |
414 |
22 |
5% |
| • Newport Coast |
200 |
14 |
7% |
In other news…
Posted in: Defaults & Foreclosures • Distressed sales • distress | 4 Comments »
June 18th, 2009, 2:00 am by Mathew Padilla
Home market watcher Steve Thomas at Altera Real Estate in Aliso Viejo is recovering from heart surgery and feeling strong enough to report again on foreclosures and short sales on the market in Orange County. Good to see him back.
As of June 11, Thomas counted 424 foreclosures for sale in Orange County, 70% down from the peak of 1,404 in November ‘08. More than 1,000 foreclosures are in escrow.
Including short sales, 3,062 distressed houses and condos were for sale, 49% off of the peak of 5,950 in August 2008.
Thomas said strong buyer demand for properties under $1 million is pushing foreclosure inventory down.
“Distressed sales now account for 33% of the active listing inventory and 53% of demand,” he said. “The expected market time for foreclosures is currently 0.65 months. For short sales, the expected market time is 2.10 months.”
Market time is his measure of how fast all foreclosures or short sales for sale would sell at the current monthly pace of sales.
A drop in foreclosure inventory fits with numbers from DataQuick.
Last month I reported that banks took possession of roughly 7,000 houses and condos from July 2008 to January 2009 in the county, according to a special report I requested from DataQuick. But buyers had taken an equal amount off the market. That equated to 1,000 foreclosures selling per month.
From February to May, banks seized an average of 596 properties per month. So if foreclosure resales remained in the 1,000-per-month range, the for-sale inventory could have decreased significantly over the period. Much depends on how banks and loan servicers handle their backlog of loan defaults — how often they modify loans and if they are improving upon last year’s track record of more than 50% of borrowers re-defaulting after a modification.
In any case, the lower for-sale inventory of foreclosures does not mean housing has bottomed. The county’s 8% unemployment rate indicates more foreclosures are likely coming, as I wrote HERE.
For a look at market demand for all for-sale properties, CLICK HERE.
Note: Short sales are when a bank agrees to accept less than the debt owed on a property. Not all properties listed as short sales get such bank approval.
Finally, here’s a look at various slices of the O.C. market as of last Thursday: total inventory listings; distressed property listings; and the share distressed listings have of total inventory supply on a percentage basis in each niche …
| Slice |
All inventory |
Distressed |
Share |
| By price … |
|
|
|
| • O.C. $0-$250k |
1,558 |
911 |
58% |
| • O.C. $250-$500k |
2,314 |
1,327 |
57% |
| • O.C. $500k-$750k |
1,724 |
484 |
28% |
| • O.C. $750k-$1m |
1,080 |
188 |
17% |
| • O.C. $1m-$1.5m |
1,007 |
99 |
10% |
| • O.C. $1.5m-$2m |
581 |
33 |
6% |
| • O.C. $2m-4m |
764 |
21 |
3% |
| • O.C. $4m+ |
391 |
4 |
1% |
| All O.C. |
9,313 |
3,062 |
33% |
| • Attached |
3,572 |
1,514 |
42% |
| • Detached |
5,726 |
1,535 |
27% |
| County high share |
|
|
|
| • Santa Ana |
606 |
452 |
75% |
| • Foothill Ranch |
42 |
29 |
69% |
| • Anaheim |
414 |
280 |
68% |
| • Garden Grove |
211 |
140 |
66% |
| • Rancho Santa Marg. |
120 |
77 |
64% |
| • La Habra |
117 |
69 |
59% |
| • Buena Park |
112 |
65 |
58% |
| County low share … |
|
|
|
| • Seal Beach |
284 |
5 |
2% |
| • Laguna Woods |
418 |
18 |
4% |
| • Newport Coast |
201 |
11 |
5% |
| • Laguna Beach |
403 |
25 |
6% |
| • Corona Del Mar |
233 |
15 |
6% |
In other news…
Posted in: Defaults & Foreclosures • Distressed sales | 18 Comments »
June 17th, 2009, 12:05 am by Mathew Padilla
Banks on average were willing to take a 34% discount against the first mortgage on an Orange County property at foreclosures auctions, known as trustee’s sales, last month, ForeclosureRadar.com reported yesterday.
Although the discount was up from 32% in April and 23% in May 2008, it has been mostly flat this year. The average discount shot up early last year as foreclosures mounted. During the housing boom, banks generally did not offer discounts.
Investors buy a small portion of homes auctioned at trustee’s sales in Orange County despite the hefty discount. There are several reasons:
- Even with the discount, the bank may still be asking more than a property will fetch if an investor quickly resells it — especially including costs to prepare it for resale.
- An investor may have to evict the former homeowner.
- There could be property damage. Properties are sold “as is” at auctions.
To see my previous post on ForeclosureRadar showing a plateau in foreclosure filings, CLICK HERE.
And read about California’s 90-day foreclosure moratorium HERE.
In other news…
Posted in: Defaults & Foreclosures • Distressed sales • REO • distress | 8 Comments »
June 3rd, 2009, 4:31 pm by Mathew Padilla
The Federal Deposit Insurance Corp. is postponing a pilot sale of bad assets held by banks, but the Legacy Loans Program is still alive, the agency said.
Chairman Sheila Bair said in a release today, “Banks have been able to raise capital without having to sell bad assets through the LLP, which reflects renewed investor confidence in our banking system. As a consequence, banks and their supervisors will take additional time to assess the magnitude and timing of troubled assets sales as part of our larger efforts to strengthen the banking sector.”
The Wall Street Journal reported on May 27 that the program was in trouble, because banks and investors are nervous about Congress changing the rules in a political atmosphere hostile to Wall Street.
The FDIC’s program is supposed to be part of the larger Public Private Investment Program. Under PPIP, the FDIC is supposed to focus on whole loans, and Treasury focus on securities. Treasury is expected to move ahead and could start purchases in summer. But the size of the program could be reduced, the WSJ reported.
The FDIC also said today:
As a next step, the FDIC will test the funding mechanism contemplated by the LLP in a sale of receivership assets this summer. This funding mechanism draws upon concepts successfully employed by the Resolution Trust Corporation in the 1990s, which routinely assisted in the financing of asset sales through responsible use of leverage. The FDIC expects to solicit bids for this sale of receivership assets in July.
Chairman Bair added, “The FDIC will continue its work on the LLP and will be prepared to offer it in the future as an important tool to cleanse bank balance sheets and bolster their ability to support the credit needs of the economy.”
(Note: Headline for this post taken from Calculated Risk.)
In other news…
Posted in: Distressed sales • Meltdown • distress | Post a Comment »
May 28th, 2009, 4:29 pm by John Gittelsohn
Jon Daurio, chairman and CEO of an Orange company that trades distressed mortgages, says the closing of a private equity firm that pledged up to $1 billion for his investments will not slow his growth.
“Not in the slightest,” said Daurio, co-founder of Kondaur Capital Corp. in Orange.
Pequot Capital Management Inc., once the world’s largest hedge fund, announced it will be closing because of an ongoing investigation by the U.S. Securities and Exchange Commission over possible insider trading of Microsoft Corp. stock.
Kondaur has so far invested about $175 million of the $1 billion pledged by Pequot, Daurio said.
Kondaur has a “contractual obligation” from Michael Corasaniti, a Pequot executive who will be assuming management of the firm’s funds under a new corporate entity, to provide the remainder of the $1 billion — and possibly more money.
Daurio said he will also be exploring alternative avenues for raising capital, including possibly selling stock. PennyMac Mortage Investment Trust, a Calabasas company headed by a former executive of Countrywide Financial Corp., filed papers to raise $750 million through an initial public offering to trade in distressed mortgages.
Daurio says he expects the volume of troubled mortgages to grow and real estate values to continue to drop by an average 1.5% a month or 20% a year.
“The discounts I’m paying for loans is growing, but less fast than home prices are falling,” Daurio said.
Kondaur was started in 2007 and now employs 268 people. It is located at the former headquarters building of Ameriquest Mortgage Corp.
To read more about Kondaur, CLICK HERE.
In other news…
Posted in: Company Watch • Countrywide • Distressed sales • Investigations • Legal problems • Mortgage jobs • loan mods • Ameriquest • Daurio • encore • Kondaur • Orange • pequot | 4 Comments »
May 4th, 2009, 12:29 am by Jon Lansner
Here’s snippets of the latest property inventory report by Steve Thomas at Altera Real Estate in Aliso Viejo, in particular, the stuff about O.C. distressed properties (homes listed by agents in the MLS system as foreclosures or short sales.) As of last Thursday …
- As a percent of all listed homes for sale, distressed properties were 35.9% of the market last week.
- 49% of the homes listed for sale under $1 million were “distressed.”
- 6% of the million-dollar listings were “distressed.”
- 3,724 distressed homes on the market — 37% off of the peak of 5,950 in August 2008.
- Foreclosures for sale dropped 62% from November 2008 peak.
Here’s a look at various slices of the O.C. market as of last Thursday: total inventory listings; distressed property listings; and the share distressed listings have of total inventory supply on a percentage basis in each niche …
| Slice |
All inventory |
Distressed |
Share |
| By price … |
|
|
|
| • O.C. $0-$250k |
1,860 |
1,190 |
64% |
| • O.C. $250-$500k |
2,968 |
1,842 |
62% |
| • O.C. $500k-$750k |
1,963 |
596 |
30% |
| • O.C. $750k-$1m |
1,136 |
231 |
20% |
| • O.C. $1m-$1.5m |
1,027 |
103 |
10% |
| • O.C. $1.5m-$2m |
600 |
41 |
7% |
| • O.C. $2m-4m |
724 |
18 |
2% |
| • O.C. $4m+ |
392 |
5 |
1% |
| All O.C. |
10,363 |
3,724 |
36% |
| • Attached |
4,076 |
1,808 |
44% |
| • Detached |
6,236 |
1,904 |
31% |
| County high share … |
|
|
|
| • Santa Ana |
709 |
558 |
79% |
| • Foothill Ranch |
55 |
41 |
75% |
| • Garden Grove |
244 |
172 |
70% |
| County low share … |
|
|
|
| • Seal Beach |
327 |
4 |
1% |
| • Laguna Woods |
426 |
14 |
3% |
| • Corona Del Mar |
224 |
12 |
5% |
Other news …
Posted in: Distressed sales • Altera Real Estate • distress | 6 Comments »
April 20th, 2009, 12:57 am by Jon Lansner
The latest property inventory report by Steve Thomas at Altera Real Estate in Aliso Viejo says:
There were just 613 bank-owned foreclosures for sale in Orange County last week — and deals in the works to buy homes from banks totaled 938. That puts Thomas’ expected market time for foreclosures at 19 days vs. 3 months for all homes.
Thomas says of last week the number of O.C. distressed properties (homes listed by agents in the MLS system as foreclosures or short sales) …
- As a percent of all listed homes for sale, distressed properties were 37.9% of the market.
- 49% of the homes listed for sale under $1 million were “distressed.”
- 6% of the million-dollar listings were “distressed.”
Here’s a look at various slices of the O.C. market as of last Thursday: total inventory listings; distressed property listings; and the share distressed listings have of total inventory supply on a percentage basis in each niche …
| Slice |
All inventory |
Distressed |
Share |
| By price … |
|
|
|
| • O.C. $0-$250k |
1,860 |
1,190 |
64% |
| • O.C. $250-$500k |
2,968 |
1,842 |
62% |
| • O.C. $500k-$750k |
1,963 |
596 |
30% |
| • O.C. $750k-$1m |
1,136 |
231 |
20% |
| • O.C. $1m-$1.5m |
1,027 |
103 |
10% |
| • O.C. $1.5m-$2m |
600 |
41 |
7% |
| • O.C. $2m-4m |
724 |
18 |
2% |
| • O.C. $4m+ |
392 |
5 |
1% |
| All O.C. |
10,561 |
4,006 |
38% |
| • Attached |
4,181 |
1,925 |
46% |
| • Detached |
6,438 |
2,068 |
32% |
| County high share … |
|
|
|
| • Santa Ana |
737 |
587 |
80% |
| • Anaheim |
584 |
431 |
74% |
| • Garden Grove |
255 |
188 |
74% |
| County low share … |
|
|
|
| • Seal Beach |
333 |
6 |
2% |
| • Laguna Woods |
420 |
18 |
4% |
| • Corona Del Mar |
221 |
13 |
6% |
Other real estate news:
O.C. called nation’s 10th worst housing market
Not-so-stressful stress tests for banks
Elevator is the draw at this Surf City open house
8 Laguna Beach homes headed to auction
Poll: Renters tax revolt! Good idea?
Western builder optimism at 6-month high. Why?
O.C. rents to be depressed for year or more
Lyon Homes offers bondholders a short sale
Not-so-stressful stress tests for banks
Feds seize bank unit of O.C. company
Do we want more financial innovation?
A complicated mortgage that could fund retirement
Posted in: Distressed sales • Altera Real Estate | 14 Comments »
April 15th, 2009, 12:35 pm by Mathew Padilla
This is a short follow up to my previous post that foreclosures in Orange County dropped in March, while early foreclosure filings (notices of default) spiked.
ForeclosureRadar.com also reports that last month at foreclosure auctions, known as trustee’s sales, banks were willing to accept an average 34.4% discount on money owned on each property. That was up from a discount of 29.3% in February and 16.7% in March 2008.
As a hypothetical example, if a homeowner owed $500,000 on a first mortgage at the time of the auction, the bank would have accepted $328,000, or a discount of $172,000.
The increase in average discounts suggests banks would like to dump more properties at auction, and let someone else worry about evicting the current owner or fixing property damage.
If a first lien holder sells a property at auction for less than what it is owed, my understanding is any second mortgage (or third or fourth) is wiped out.
In other news…
Posted in: Defaults & Foreclosures • Distressed sales • Auction Discount • Trustee's Sale | 4 Comments »
April 6th, 2009, 3:00 am by Mathew Padilla
Home market watcher Steve Thomas at Altera Real Estate in Aliso Viejo reports that the number of O.C. distressed properties (homes listed by agents as foreclosures or short sales) was 4,092 last week, down 581 vs. two weeks earlier or a -12.4% change.
Distressed inventory is down 31% from the peak of 5,950 in early August 2008.
And as a percent of all listed homes for sale, distressed properties were 37.1% of the market last week vs. 40.3% two weeks earlier. However, I previously noted that banks are holding more O.C. foreclosures on their books than a year ago. (For more on the overall for-sale market, CLICK HERE.)
As of last week, Thomas counted 731 foreclosures in the MLS, 170 fewer than two weeks earlier. There were 953 foreclosures in pending sales. At that pace it would take less than a month to sell all the foreclosures on the market, Thomas writes. Of course, banks keep adding new ones. Here’s more from Thomas:
The foreclosure market is extremely hot. Buyers can expect to compete with multiple offers and sales prices above their list prices. The short sale inventory shed 391 homes in the past two weeks to 3,379 homes. The short sale inventory height, 4,701, was reached on August 7, 2008, coinciding with the total distressed inventory height. There are 1,322 fewer short sales on the market today. Demand for short sales increased by 205 pending sales, totaling 967. Since short sales are subject to lenders approval and are often not changed to pending status until lender approval is received, this may be a sign that lenders are gearing up to curb foreclosures through the accommodation of short sales.
Here’s a look at various slices of the O.C. market as of last Thursday: total inventory listings; distressed property listings; and the share distressed listings have of total inventory supply on a percentage basis in each niche …
| Slice |
All inventory |
Distressed |
Share |
| By price … |
|
|
|
| • O.C. $0-$250k |
1,955 |
1,189 |
61% |
| • O.C. $250-$500k |
3,247 |
1,933 |
60% |
| • O.C. $500k-$750k |
2,040 |
593 |
29% |
| • O.C. $750k-$1m |
1,158 |
222 |
19% |
| • O.C. $1m-$1.5m |
1,036 |
99 |
10% |
| • O.C. $1.5m-$2m |
599 |
43 |
7% |
| • O.C. $2m-4m |
716 |
17 |
2% |
| • O.C. $4m+ |
391 |
5 |
1% |
| All O.C. |
11,026 |
4,092 |
37% |
| • Attached |
4,350 |
1,909 |
44% |
| • Detached |
6,638 |
2,166 |
33% |
| County high share |
|
|
|
| • Santa Ana |
772 |
581 |
75% |
| • Anaheim |
655 |
475 |
73% |
| • Garden Grove |
296 |
212 |
72% |
| • Foothill Ranch |
56 |
39 |
70% |
| • Rancho Santa Marg. |
156 |
102 |
65% |
| • Buena Park |
144 |
94 |
65% |
| • Aliso Viejo |
213 |
139 |
65% |
| County low share … |
|
|
|
| • Seal Beach |
347 |
7 |
2% |
| • Laguna Woods |
415 |
18 |
4% |
| • Corona Del Mar |
217 |
12 |
6% |
| • Laguna Beach |
385 |
24 |
6% |
| • Newport Beach |
631 |
48 |
8% |
The latest banking/lending stories …
… and OC housing …
Posted in: Defaults & Foreclosures • Distressed sales • Meltdown | 15 Comments »
March 23rd, 2009, 2:03 am by Jon Lansner
The biweekly property invetory report by Steve Thomas at Altera Real Estate in Aliso Viejo tracks the number of O.C. distressed properties (homes listed by agents in the MLS system as foreclosures or short sales) … change. The latest edition notes:
- As a percent of all listed homes for sale, distressed properties were 40.3% of the market last week.
- 50% of the homes listed for sale under $1 million were “distressed.”
- 6% of the million-dollar listings were “distressed.”
- As the market marches forward, the distressed active inventory, both foreclosures and short sales, has dropped by 21% since its peak in August of 2008. There have been various explanations for a dip in the number of distressed sales, like legislation that lengthens the amount of time to file a notice of default (when somebody is behind on their mortgage) and ultimately delay foreclosure. The problem with that theory is that the distressed inventory has been steadily dropping for seven months.
Here’s a look at various slices of the O.C. market as of last Thursday: total inventory listings; distressed property listings; and the share distressed listings have of total inventory supply on a percentage basis in each niche …
| Slice |
All inventory |
Distressed |
Share |
| By price … |
|
|
|
| • O.C. $0-$250k |
2,106 |
1,373 |
65% |
| • O.C. $250-$500k |
3,634 |
2,267 |
62% |
| • O.C. $500k-$750k |
2,145 |
645 |
30% |
| • O.C. $750k-$1m |
1,166 |
229 |
20% |
| • O.C. $1m-$1.5m |
1,005 |
102 |
10% |
| • O.C. $1.5m-$2m |
602 |
44 |
7% |
| • O.C. $2m-4m |
704 |
18 |
3% |
| • O.C. $4m+ |
372 |
3 |
1% |
| All O.C. |
11,606 |
4,673 |
40% |
| • Attached |
4,616 |
2,196 |
48% |
| • Detached |
6,937 |
2,454 |
35% |
| County high share … |
|
|
|
| • Santa Ana |
867 |
685 |
79% |
| • Garden Grove |
359 |
260 |
72% |
| • Foothill Ranch |
68 |
49 |
72% |
| County low share … |
|
|
|
| • Seal Beach |
349 |
6 |
2% |
| • Laguna Woods |
424 |
25 |
6% |
| • Corona Del Mar |
213 |
13 |
6% |
Other lending stories …
… in the homebuying world …
… from South County …
… and Surf City:
Posted in: Distressed sales | 23 Comments »
March 16th, 2009, 3:00 am by John Gittelsohn
 Daurio
Kondaur Capital Corp., an Orange company that trades in scratch and dent mortgages, is boosting its staff from the current 200 to 400 people by June 30. Jon Daurio, Kondaur’s chief executive, says he’s not looking for the type of employee who staffed the high-volume mortgage companies that went boom and bust earlier this decade. He used to work for Long Beach Mortgage Corp., the predecessor of Ameriquest Mortgage, and later Encore Credit Corp. in Irvine. Some excerpts from an interview (Daurio answered other questions HERE.):
Q. What’s the long-term vision?
A. My dream is for the next generation of employees to work here, like at GM where you have two, maybe even three generations, of workers at the company.
Q. But wouldn’t that be bad news for the economy — if a company like yours benefiting from the scratch & dent market is thriving?
A. No. I don’t anticipate the magnitude we’re seeing now, but there will always be scratch & dent loans. We’re in the process of trying to locate a bank to acquire for purchasing performing “scratch & dent” loans and to originate loans for later. I believe our system will go back to the days of “It’s a Wonderful Life.” George Bailey took in deposits and loaned out the money. The business of a bank is interest rate spreads. I believe that’s how it’s going to come back.
Q. We’re in an age of technology. What you’re talking about is a company that requires a lot of human input and a lot of high-touch. Will that work?
A. That’s how it’s going to be with banks. I think our society will go less transient. Borrowers will buy homes to live in them, not as an investment or as an ATM. I think that’ll keep Kondaur alive in banking. We’ll be the In-N-Out of banking with a very limited menu, 30-year and 15-year mortgages, not Alt-A, pay-option, neg-am stuff.
Q. What kind of people do you want to work at Kondaur?
A. The majority of our asset managers are out of consumer finance, from backgrounds in the consumer loan business, for example. They understand all consumer needs. They have a relationship with the consumer. The mentality we’ve had success with are the people who have the background, experience and sensitivity to understand the borrower.
Q. What kind of money do you pay?
A. We pay people what I believe they should get: Reasonable wages. It’s nothing like the days when account executives at companies like Ameriquest or Encore got $300,000 or $400,000 a month. Because this is a high-touch business, it’s not going to generate unreasonable profit spreads. I’m in it for the money, of course, but I don’t see people here making millions. If I’m making billions on people losing their homes, I personally couldn’t sleep at night.
Q. What kind of income do you expect to earn?
A. I’m going to be successful. I believe I’m going to be comfortable. But I’m only going to make a fraction of the guys who were CEOs of the companies on my resume. We tell people here, when we are successful, everyone will share. My share will be bigger. But it won’t be like the ratios of the companies on my resume.
Q. What’s your competition out there?
A. I’m concerned about other people coming into this business, but I don’t believe anyone else is prepared for the high-touch that you need and I don’t believe they have the team we have here. I’d love to have 5,000 people, but I’ve got to go step by step.
Q. Do you think that people who made a ton of money — what some call ill-gotten gains — should have to give back that money?
A. It depends on the circumstances. If they were a public company and they took cash out at a time they knew it was collapsing and the public did not, my answer is hell yes. Absolutely take away what those guys made. But that’s not how it all happened. I left Encore in October ‘04. I owned a lot of stock. It went public and I sold that stock and I got good returns. I took advantage of having the opportunity to get my investment back with a healthy profit. But I didn’t know in 2004 what was going to happen. Are there guys whose money should be disgorged? Absolutely. But it’s case by case.
Q. What shaped your financial philosophy?
A. I grew up in Brooklyn, the youngest of five children. I shared my bedroom with my two brothers. My grandparents lived with us. We didn’t have a sense of entitlement. I took my lunch to school in a paper bag and used it until it ripped. When I was a kid, I remember people wanted to pay off the house and then burn the note, a mortgage burning party. When my wife and I bought our house in Tustin Ranch in 1993, when my son was 11-months old. I remember vividly that the purchase price was $323,000 and we were making about $200,000 and we sweated the decision. My wife said: “What if something happens?” I still have the same house. I refinanced in 2003 with a better rate. I took from my Dad to not buy a car until you can afford it. And once you get a car, keep it. I’m a car guy, but I’ve never owned a car less than six years, unless I gave it to a family member.
Q. Is there anything good that has come out of the economic crisis?
A. I think part of the good is I found a way to make lemonade out of lemons. But the real good is there’s a cultural shift from the sense of entitlement. As a U.S. citizen and taxpayer, I’m worried. But as chairman of Kondaur, I think our company is going to weather it.
Q. How do you feel about the big picture of the economy?
A. I absolutely find myself waking up and thinking about things that can go wrong. As an entrepreneur, I worry about prices in Florida that drop 2 percent a month. We constantly tweak our models to predict how much to discount and how much I need to discount to carry the properties for 180 days.
More on Kondaur …
O.C. mortgage company hiring 200
And other banking/lending stories …
Posted in: Ameriquest • Bad debt • Broker Corner • Distressed sales • Mortgage jobs • Q&A • Daurio • Kondaur | 1 Comment »
March 9th, 2009, 6:26 am by Jon Lansner
The latest O.C. home inventory report from Steve Thomas at Altera Real Estate in Aliso Viejo says distressed inventory, a total of 4,784 foreclosures and short sales as of last week, was lower than the year ago total for the first time. A year ago it was 5,057. Here’s more…
Since peaking on August 7th at 5,950, the distressed active inventory has dropped by 20%; that is 1,166 fewer distressed homes on the active market. The distressed inventory represents 41% of the total active inventory, dropping from 42% two weeks ago. The number of pending sales that are either a short sale or a foreclosure remained at 62%. The expected market time for foreclosures increased slightly from its record low of .99 months two weeks ago to 1.08 months today. Foreclosures remain the hottest category of homes within the Orange County marketplace today. The expected market time for short sales dropped ever so slightly from 5.16 months to 5.14 months today, a record low for the current housing downturn.
Thomas says of the number of O.C. distressed properties (homes listed by agents in the MLS system as foreclosures or short sales) …
- As a percent of all listed homes for sale, distressed properties were 41.4% of the market last week.
- 51% of the homes listed for sale under $1 million were “distressed.”
- 6% of the million-dollar listings were “distressed.”
| Slice |
All inventory |
Distressed |
Share |
| By price … |
| •$0-$250k |
2,100 |
1,384 |
66% |
| •$250-$500k |
3,711 |
2,350 |
63% |
| •$500k-$750k |
2,109 |
652 |
31% |
| •$750k-$1m |
1,158 |
246 |
21% |
| •$1m-$1.5m |
950 |
95 |
10% |
| •$1.5m-$2m |
603 |
43 |
7% |
| •$2m-4m |
676 |
17 |
3% |
| •$4m+ |
376 |
3 |
1% |
| All O.C. |
11,562 |
4,784 |
41% |
| • Attached |
4,541 |
2,224 |
49% |
| • Detached |
6,966 |
2,541 |
36% |
| OC high share |
| • Santa Ana |
929 |
723 |
78% |
| • Anaheim |
699 |
527 |
75% |
| • Garden Grove |
366 |
270 |
74% |
| OC low share |
| • Seal Beach |
335 |
7 |
2% |
| • Laguna Woods |
409 |
20 |
5% |
| • Laguna Beach |
365 |
25 |
7% |
At right, here’s a look at various slices of the O.C. market as of last Thursday: total inventory listings; distressed property listings; and the share distressed listings have of total inventory supply on a percentage basis in each niche.
Other real estate news:
Posted in: Defaults & Foreclosures • Distressed sales | 9 Comments »
February 26th, 2009, 10:19 am by Mathew Padilla
The Federal Deposit Insurance Corp. today announced a way to dump, or partially dump, $1.45 billion in troubled debt. Here’s more:
The Federal Deposit Insurance Corporation (FDIC) today announced the conclusion of the sale of $1.45 billion of performing and nonperforming residential and commercial construction loans in distressed markets through the use of two private/public partnership transactions. These structured sales utilize the asset management expertise of the private sector, while retaining for the FDIC a participation interest in all future cash flows generated by the workout of the assets over time.
In the two recent transactions, the FDIC placed the loans, which were exclusively from the failed First National Bank of Nevada, into a limited liability corporation (LLC). The FDIC retained an 80 percent interest in the assets with the winning bidder picking up an initial 20 percent stake. Once certain performance thresholds are met, the FDIC’s interest drops to 60 percent. The future expenses and income will be shared on the percentage ownership of the purchaser and the FDIC.
“The FDIC is drawing on its previous successes and those of the Resolution Trust Corporation,” said James Wigand, Deputy Director, Division of Resolutions and Receiverships. “During the last banking crisis, when asset values were similarly difficult to ascertain, these types of structures ultimately resulted in superior recoveries relative to the then-depressed market valuations.”
By retaining a participation interest in the structure, the FDIC as receiver will benefit in the future return of the portfolio in addition to receiving immediate proceeds from the purchaser for its 20 percent interest in the portfolio.
The successful bidders on the two transactions were Diversified Business Strategies and Stearns Bank NA. The FDIC hired the financial advisor Keefe Bruyette Woods to market the LLC to potential bidders. In all, 18 separate bidders submitted 30 unique bids for both pools of loans.
The closure of this sale brings the total amount of assets sold utilizing private/public partnership transactions to approximately $3.2 billion over the last year, in five separate transactions. Based on the success of the program and the positive feedback received from the private sector, the FDIC anticipates it will utilize this and similar sales strategies in the future.
Read the full release HERE.
Posted in: Bailout Buzz • Bank failures • Defaults & Foreclosures • Distressed sales • Meltdown • Toxic assets | Post a Comment »
February 23rd, 2009, 12:37 am by Jon Lansner
(Update II: 19% changed to 16%.)
The latest O.C. home inventory report from Steve Thomas at Altera Real Estate in Aliso Viejo says…
- Number of distressed homes on the market as of last Thursday, both foreclosures and short sales, was off 190 from the previous two weeks. Since end of November, distressed properties for sale in O.C. are down 16% 19%.
- Distressed inventory is 42% of all homes for sale vs, 44% two weeks ago.
- 62% of all pending sales are either a short sale or a foreclosure vs. 61% two weeks ago.
- Expected market time — supply vs. sales pace — for foreclosures dropped to lowest level of the downturn at 0.99 months. Short sales’ market time was 5.16 months. Overall market’s market time was 4.03 months — tightest since April 2006.
Here’s a table showing distressed properties by category and their share of the market…
| Slice |
All inventory |
Distressed |
Share |
| By price … |
|
|
|
| • O.C. $0-$250k |
2,161 |
1,439 |
67% |
| • O.C. $250-$500k |
3,750 |
2,371 |
63% |
| • O.C. $500k-$750k |
2,090 |
669 |
32% |
| • O.C. $750k-$1m |
1,125 |
242 |
22% |
| • O.C. $1m-$1.5m |
932 |
102 |
11% |
| • O.C. $1.5m-$2m |
580 |
39 |
7% |
| • O.C. $2m-4m |
654 |
21 |
3% |
| • O.C. $4m+ |
367 |
2 |
1% |
| All O.C. |
11,541 |
4,883 |
42% |
| • Attached |
4,582 |
2,281 |
50% |
| • Detached |
6,886 |
2,573 |
37% |
| County high share |
|
|
|
| • Santa Ana |
1,008 |
794 |
79% |
| • Anaheim |
755 |
558 |
74% |
| • Garden Grove |
381 |
277 |
73% |
| • Foothill Ranch |
68 |
47 |
69% |
| • Lake Forest |
181 |
121 |
67% |
| • Portola Hills |
21 |
14 |
67% |
| • Rancho Santa Marg. |
169 |
112 |
66% |
| County low share … |
|
|
|
| • Seal Beach |
331 |
7 |
2% |
| • Laguna Woods |
391 |
15 |
4% |
| • Laguna Beach |
345 |
24 |
7% |
| • Corona Del Mar |
196 |
15 |
8% |
| • Newport Coast |
203 |
16 |
8% |
Other news …
Posted in: Defaults & Foreclosures • Distressed sales • Meltdown | 12 Comments »
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