Clearwater Real Estate

On Friday, Freddie Mac announced that they had a plan to help homeowners facing foreclosure by renting them their homes back.  The experiment will help approximately 8600 families in 2009 to rent back their homes at fair market rents if they can qualify to pay the fair market rents.

On the surface this probably doesn’t look like much.  Even if the leases are only month to month it still doesn’t look like much.  Even if there were 2.7 million possible foreclosures last year, the plan still doesn’t seem to do much for Tampa Bay Real Estate.  Or does it…

If you take the action that Fannie Mae did in Decmber which will allow approximately 10,000 renters to stay in the foreclosed homes they unknowing rented and add this program to it, what you might have is a clever little experiment.  Not a full tank of gas but possibly enought to keep the wheels on the bus turning!

Think about how difficult it would be to solve the entire housing crisis with the passing of one program.  What if it failed, horribly?  And, what if someone got a huge benefit just by being a key recipient?  Everyone else would think the whole thing was corrupt or biased or something else really bad like insider payoffs from prior contracts or worse.

So, if you roll out a few programs to test the impact and review the cause and effect of the programs, say from a sampling, then you have a decent little experiment with supported probabilities and predictable outcomes.  Hopefully, ones that help people continue on with more hope and dignity.

Now, that would be a good recipe for confidence in a loca market that is desparate for positive stimulus, not a random shot in the dark that may or may not work.  The local market is going to have no benefit in the testing phase of this plan, but as non-conforming loan servicers analyze and adopt the best parts of the latest GSE stimulus, we will see the right programs rolled out in mass.

The programs that the Tampa Bay area real estate market needs as it steers into some unchartered waters this year.  These Freddie Mac and Fannie Mae experiments are intregral to the success of the larger and more at risk players.  

The offspring of these GSE initiatives will be great for the local market…we are closer to having them in our market and thanks to the FHFA people, we should have real documentation to prove that it works.  It has been a while since we have seen progressive action from these entities.

Finally, it is still January and between now and July alot will happen to right the ship and more importantly, keep it from taking on more water!

I see this little effort as a big payout in the coming months for the Tampa Bay foreclosure market.  Let’s embrace progression!

The latest NAHB/Wells Fargo (HMI), released today sites home builder confidence at new record low of 8, (E-I-G-H-T). 

A rating of 50 or above is considered GOOD for builders.

This is really good news if you are selling your home, not building a brand new one! 

One article states that new home starts are off 75% from the market peak. 

Again, good news if you have a home that is already built and want to sell it. 

The inventory you were competing with is disappearing and your competition is now comparable.  While prices may not be going up any time soon, the opportunity to review an offer may. 

The outlook for controlling residential resale inventory is better based on this recent industry news!

Sit tight and new hope is alive as stimulus and incentives will aid purchasers as they request more showings on existing dream supply versus waiting for builders.

Companies are being formed by elite investors to obtain troubles mortgages throughout the US.  Tampa Bay area real estate owners could find themselves on the receiving end of this natural economic evolution.

As I understand it, the investors pool shareholder’s cash and make offers to banks for real estate portfolio-type buys.  The originators of these investment pools or trusts can leverage $10-$100’s of millions of dollars at a time in a targeted distressed market.  The buys are effective, efficient and profitable for the shareholders.  

The result of this type of innovation is a percentage of troubled homeowners will be able to keep their homes at mangeble payments, a percentage of the purchased homes can be flipped for immediate gain and a percentage of the investments could stay in the portfolio for longer term holds as income producing properties. 

The mortgage strategy model should aid in Tampa Bay area’s real estate recovery and significantly temper the impending inventory burdens we face.  That’s really good news!

A new administration stimulus package positively affecting real estate in the Tampa Bay area could put things over the top and fuel the future for the Tampa Bay area late summer rebound.