Advice Archive

Fool.co.uk, the UK division of The Motley Fool, has paid us for a review of their Mortgage Centre.

Spurred by community activist groups complaining to the FTC, Erick Schonfeld writes today on The Next Net blog:

Zillow’s strategy seems to be to offer real estate porn to middle-aged homeowners. (”Ooh, look how much my house is worth!”). But as more people begin to realize that the underlying data on the site cannot be trusted, the backlash won’t be limited to just community activists.

You knew it was only a matter of time before Google started making real use of all those real estate listings in Google Base. Erick Schonfeld from Business 2.0 reports today:

As anticipated, Google is now in the real-estate listings business.  If you do a regular search for "real estate" or other similar keywords on Google, two new search boxes will pop down allowing you to refine your search by loaction or listing type ("for rent" or "for sale").  Then you get taken to a Google Base page with the listings plotted on a Google Map (see above).

We saw this coming more than a year ago, and it’s finally here. In Some homeowners struggle to keep up with adjustable rates, USA TODAY reports:

America’s five-year real estate boom was fueled partly by a tempting array of cut-rate mortgages that helped millions of Americans qualify for home or refinance loans. To afford soaring home prices, many turned to adjustable-rate and other, riskier loans with low initial payments. The homeownership rate hit a record 70%.

Now, the real estate market is cooling, interest rates are rising and tens of thousands more Americans are starting to have trouble paying their mortgages. Nearly 25% of mortgages — 10 million — carry adjustable interest rates. And most of them went to people with subpar credit ratings who accepted higher interest rates, according to the Mortgage Bankers Association.

…

Already, in West Virginia, Alabama, Michigan, Missouri and Tennessee, about one in five homeowners with a high-interest (subprime) ARM was at least 30 days late at the end of last year, according to the Mortgage Bankers Association. After 90 days, the foreclosure clock starts ticking.

Most of those foreclosures are related to job losses in auto and garment factories; higher mortgage payments were often the last straw.

…

Of the 7.7 million households who took out ARMs over the past two years to buy or refinance, up to 1 million could lose their homes through foreclosure over the next five years because they won’t be able to afford their mortgage payments, and their homes will be worth less than they owe, according to Cagan’s research.

There are probably more real estate agents today than at any other time in history. This makes the critical process of selecting a good one to guide you through the sale of your home more difficult than it has ever been. Should you go with an agent from a large, recognized firm? Do they have access to more buyers than someone at a small firm?

We tackle all these questions and more over on HBN today in How to Select a Real Estate Agent.

A recent article on CNNMoney.com stated that, “Experts say jump in cancelled orders for new homes is latest sign of how investors inflated the real estate market recently, and how the market is due for a downturn.” It really troubles me to see them use the word “investors” in that context. Here’s why.

“RETURNTODC” asked some challenging questions to realtors yesterday, and Becky Trout, a REALTOR® from Florida, gives some good answers.

As an investor, I used to buy, sell and rehab properties. I began small but soon got up to the point where I had over 10 properties at any given time that were in acquisition mode, rehab or on the market. I sold everything by owner and I usually turned a property within 30 days of completed rehab.

The work was beginning to overwhelm me, though. I knew that to grow my business I needed to outsource something. Having someone else market and sell the property was the most painless thing to let go of, and I also knew what I was doing from a transaction standpoint so I could easily monitor the contract’s progress, etc., so I hired a real estate agent from a major brand who, on paper, looked like she was the perfect fit for what I needed.

Man, was I wrong.

Ilyce Glink gives her answer to a question over on Inman.com today. Ilyce has “no idea what the seller of this property is doing,” but offers up some possibilities. She misses one very likely one, though.