Americans concerns about key

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1 Real Estate Digest Consumer Attitudes Stabilize on Economic News 275 Mundy Street, Suite 202, Wilkes-Barre, PA Americans concerns about key economic and housing issues are beginning to subside, according to results from Fannie Mae s latest 2012 National Housing Survey. Consumers attitudes have stabilized across most indicators including personal finances, housing, and employment demonstrating their sense that downside risks have abated somewhat compared to late summer and fall of While differences in Americans confidence in the direction of the economy abound, their confidence about personal financial situations, household income and household expenses, as well as attitudes about homeownership and renting, are holding at steady levels. Job worries decline At the same time, Americans concern about losing their job in the next 12 months has stabilized since the late fall, with 76 percent of Americans saying they are not concerned, compared to 70 percent in November The pickup in the pace of hiring over the past few months has helped soothe consumer concerns, lifting their moods regarding their personal finances, the direction of the economy, and their views on the housing market, says Doug Duncan,

2 vice president and chief economist of Fannie Mae. As a result, we ve seen more potential for economic upside, creating a more balanced near-term outlook. Economic optimism The rise in confidence in the economy s direction continued, with 35 percent responding that they think the economy is on the right track, a five percentage point increase from January. The percentage of respondents who say the economy is on the wrong track dropped to 57 percent, a decline of 6 percentage points. Only 12 percent think that their personal financial situation will worsen in the next 12 months, a three percentage point drop from January and the lowest value in over a year. Sixteen percent of respondents say their income is significantly lower than it was 12 months ago (down one percentage point since January), while 63 percent say it has stayed the same (up one percentage point since January). Thirty-three percent say their expenses have increased significantly over the past 12 months, a three percentage point decrease from last month and the lowest level in the past 12 months. On average, Americans expect home prices to increase by 0.8 percent over the next 12 months. Twenty-eight percent of respondents expect home prices to increase over the next 12 months, while 15 percent say they expect home prices to decline (down 1 percentage point since last month). Fifty-three percent say prices will stay the same. MARKETS Estimate: $100 Billion in Foreclosures to Go Rental The Federal Reserve estimates more than $100 billion worth of foreclosed properties will be converted into rental housing this year, taking pressure off rising rents, creating more housing for low- and moderateincome families, and possibly pushing up prices on unencumbered homes for sale. The Fed said lenders could receive Community Reinvestment Act credit for providing housing to low-income and moderate-income families by converting foreclosures to rentals. Typically, foreclosures must remain rental properties for a specific number of years usually five before they can be put back on the market. Top 10 Turnaround Housing Markets Cities hardest hit by the foreclosure crisis are among those leading a housing recovery, Move Inc. reports in its Top Turnaround Town Report for May. Move Inc. compiled a list of Top Turnaround Towns for May, using year-over-year housing data from the first quarters of 2012 and Many of the cities in the top 25 that have seen the biggest boosts in price appreciation are also seeing a big drop

3 to inventories of homes for sale. Some of the states that suffered the worst of the foreclosure crisis such as Florida, Arizona and California have cities represented on the list, and are showing some of the biggest signs of recovery. The following are the top 10 turnaround markets, according to Move Inc. s report from May (including the year-over-year median list price increases). 1 Phoenix-Mesa, Ariz. - Median list price increase from Q to Q1 2012: % 2 Miami - Median list price increase from Q to Q1 2012: % 3 Orlando - Median list price increase from Q to Q1 2012: % 4 Boise, Idaho - Median list price increase from Q to Q1 2012: % 5 Naples, Fla. - Median list price increase from Q to Q1 2012: % 6 Oakland, Calif. - Median list price increase from Q to Q1 2012: +7.07% 7 Fort Myers-Cape Coral, Fla. - Median list price increase from Q to Q1 2012: % 8 Lakeland-Winter Haven, Fla. - Median list price increase from Q to Q1 2012: % 9 Sarasota-Bradenton, Fla. - Median list price increase from Q to Q1 2012: % 10 Tampa-St. Petersburg-Clearwater, Fla. - Median list price increase from Q to Q1 2012: % We continue to see signs of stabilization and recovery on the local level throughout the country, says Steve Berkowitz, CEO of Realtor.com s operator, Move Inc. By all indications, the 2012 housing market is unfolding as we expected, and we re encouraged with the progress local markets are making. However, much will depend on the continued health of our economy, specifically job rates, and how lenders will release their foreclosure inventories. Residents Give Homeowner Associations High Marks The Community Associations Institute (CAI) has released a poll of residents living in homeowner-association properties and, overall, the associations get high marks for protecting property values and return on investment of dues dollars. About 62 million people live in the country s 315,000 homeowner associations. The poll found that: Y 81 percent of association residents believe they get a good or great return on their association assessments; 18 percent say they don t; and 2 percent aren t sure. Y 76 percent say their community association rules protect and enhance property values, while only three percent said rules harm property values, and 21 percent said there was no difference. Asked to name the worst aspects of their associations, 34 percent said there was nothing bad. That was followed by restrictions on exterior improvements (15 percent), dealing with neighbors (10 percent) and paying assessments (9 percent).

4 TRENDS Builders Seeing Even More Green Ahead Builders are quickly going green but mainly because green represents higher-quality housing with lower operating costs, found a study from McGraw-Hill Construction. Buyers of new homes are strongly valuedriven around two-thirds of builders and remodelers state that customers request green homes or remodeling projects in order to lower their energy use or save money. The survey also notes that while building green meant a more expensive home or remodeling project in 2008, today s builders say the difference has practically vanished primarily because almost all homes are being built with better insulation and windows, and things like EnergyStar appliances are commonplace. Arizona Is Latest State to erecord All Property Data The Property Records Industry Association (PRIA) has announced that Arizona has joined Colorado and Hawaii as states with 100 percent of their counties recording property data electronically. According to the PRIA, about 800 counties nationwide now have electronic property recording. There are 3,089 counties, parishes and boroughs in the United States. Community Organizations Say Housing Discrimination Is Widespread Community-based organizations (CBOs) dealing with the disabled, immigrants, the underprivileged and families with children are reporting that housing discrimination continues to be widespread, and the most vulnerable consumers are unsure how to protect themselves. A Consumer Action survey of 549 community-based organizations found: Y Seven out of 10 CBOs consider housing discrimination a very serious or somewhat serious problem. Y Forty percent of CBOs believe housing discrimination has increased in the last two years and 11 percent believe it has decreased. Y About two-thirds of CBOs say the level of awareness about housing discrimination rights among the individuals they serve is somewhat low or very low. As America Ages, Households Age The U.S. Census Bureau has released a new report that again emphasizes that America is aging and the impact is being seen in households. According to the Bureau, in 2010 there were fewer households with people under the age of 18 living in them than in Those households dropped from 36 percent of the total in 2000 to 33 percent in Meanwhile,

5 the percent of households with people 65 and older increased across the decade. In 2000, 23 percent of households included someone 65 and over, compared with 25 percent in MORTGAGES Government Moves to Quicken Short-Sale Process Fannie Mae and Freddie Mac have adopted new policies to streamline short sales. Under the new guidelines, mortgage servicers will be required to review and respond to requests for short sales within 30 days of receiving a short sale offer. The new policies went into effect in June. Servicers also will be required to provide weekly status updates to the borrower if the short sale is under review beyond 30 days, and will need to get a final decision to the borrower within 60 days of the offer. Short sales have become a popular alternative to foreclosure, but have required long timelines to complete, discouraging buyers who want to move more quickly. The FHFA hopes the shortened timelines will lead more buyers to consider short sale properties. NAR, Others Seek Broad Definition of Qualified Mortgage NAR and a coalition of mortgage and housing interest groups are urging adoption of a broad definition of qualified mortgage that allows the maximum number of consumers to get loans at low, governmentguaranteed interest rates. In a letter to the Consumer Financial Protection Bureau, NAR and the other groups stressed that credit-worthy homebuyers should be able to get loans without being forced to go to higher interest rate lenders. Some financial experts believe mortgage qualification guidelines should be narrowed so that only those with the highest credit scores can qualify for loans. NAR believes such a tight definition would disqualify many buyers from low-rate loans and jeopardize the housing recovery. Tight Credit Hampering Recovery of Small Business Properties Market Commercial lending standards have tightened in the past year for small businesses, resulting in disruption of a substantial number of transactions for smaller properties, according to NAR s annual Commercial Real Estate Lending Survey. More than half of respondents said lending is just as stringent as a year ago, while 23 percent say it is more stringent. About 20 percent said it is less stringent but not near historical averages. Thirty-six percent of Realtor-members said clients used the Small Business Administration commercial refinance program, but of those who didn t, 45 percent said it was due to burdensome application and reporting requirements. The most common types of property transactions referenced in the survey were multifamily, land, warehouse, suburban office and retail strip centers.

6 INDUSTRY Agent Places Value of White House at $110 million Just in case you were wondering, a Washington real estate agent has placed a value on the White House of about $110 million, based on size, number of rooms and location. At the request of the blog Movoto.com, agent Jason Koitz based his estimate on the number of square feet (55,000) and rooms (132 plus 35 baths), plus special amenities such as an indoor jogging track, bowling alley, movie theater and tennis court. Interestingly, Zillow.com places its estimate of the same government housing at a much higher price: more than $232 million. AGENTS CORNER Five Simple Steps to a Powerful Virtual Tour A virtual tour is very easy to create and can instantly enhance your listing. Here are five simple steps to creating a virtual tour: 1 Download a free video editing software program. If you re on a PC, you could use Microsoft Movie Maker, or if you re on a Mac, Apple imovie. Both of these are extremely easy to use. 2 Take out your smartphone or digital camera the next time you re at the property (or to be really efficient, do it at the same time you re taking regular photos). 3 Walk through the home. Some agents like to narrate, but you don t have to. Make sure you walk through the home as you would lead a potential client through. 4 Transfer your movie file to your computer, open it with your editing software and edit as necessary. 5 Upload the finished file to your website, or any software platform you may use. Try it out on your next listing. You ll never know the power of a great virtual tour until you have one on your own listing. Agents, Consumers Reveal Too Much on Facebook, Consumer Reports Says Are Facebook s 150 million American users revealing too much and are you one of them? According to a recent study by Consumer Reports of more than 1,300 households who use Facebook, many Facebook users do not use privacy settings and reveal too much about their day-to-day plans that could be putting themselves and their information at risk. According to the study, researchers project that 4.8 million people have used Facebook to reveal their plans on a certain day, which could serve as a tip-off to burglars.

7 The report also projected that nearly 13 million Facebook users never set any privacy controls on their Facebook account or were not even aware about privacy controls. Twenty-eight percent of users share all or nearly all of their wall posts with everyone, besides just their connected friends. Meanwhile, Consumer Reports says that reported problems are increasing, with 11 percent of users saying that they had trouble with their Facebook account last year, such as with someone using their log-in information without permission or that they had been harassed or threatened on Facebook. Consumer Reports warns that Facebook collects more information about you than you may even know about. For example, did you know that Facebook gets a report every time you visit a site with a Facebook Like button, even if you never click the button, are not a Facebook user, or are not logged in? the article notes. Even if you have restricted your information to be seen by friends only, a friend who is using a Facebook app could allow your data to be transferred to a third party without your knowledge. The article offers some tips for better protecting yourself on Facebook, such as: Y See what s out there: Every month see how your page looks to others and see if you need to add any more privacy settings to your page. Y Review your wall settings: Keep security settings for your wall posts viewable to just friends. Y Watch the apps: Unless you intercede, friends can share personal information about you with apps. To block that, use controls to limit the info apps can see. continued on next page

8 275 Mundy Street, Suite 202, Wilkes-Barre, PA Buyers and sellers use Tiger Abstract as their resource for professional title research and insurance. Tiger gives them assurance, confidence and the important details needed to close the deal. Customer satisfaction is a high priority and always will be. When Tiger goes on the prowl, we find fast, accurate, timely answers to your questions. Expect accuracy and reliability. Expect security and resources. Expect strength and efficiency These are the marks of Tiger! For more information: Call, fax or visit us online: TIGER8 ( ) Fax: SmartsPro MARKETING The information presented and conclusions stated in this newsletter are based solely upon our best judgement and analysis of information sources. It is not guaranteed information and is not necessarily a complete statement of all available data. Web site citations are current at time of publication but subject to change. This material may not be quoted or reproduced in any form, including copy machines or any electronic storage or transmission medium, in whole or in part, without permission from the publisher. A special edition of Real Estate Digest is available for real estate agents specializing in commercial property or high-end residential, and for mortgage brokers. Please call to order your personalized copies today. All rights reserved SmartsPro Marketing PO Box 276 Ashland, Oregon,