Living In Pike.com

I am just about half way done. I figure it will take about one more month. By that time I will have 6 months of 2009 in and should be able to forecast what this year will be in foreclosures.

I am also coming up with some very interesting changes of over past years. We are starting to see high end foreclosures.

The federal government has been talking about helping home owners with their sub prime loans and loans that adjust every year. They have been asking banks and mortgage companies to bend and help out these people by working with them, adjusting their rates or not making the yearly adjustment to the interest rate. Well folks…

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Pike has had it’s fair share of what I call recycled homes (Bank owned, HUD, VA owned and Pre Foreclosures). Right now over 1 in 5 homes sold today in Pike Township is a recycled home (22.32%). In June it was almost 1 in 4 homes (24.9%).

There is a bright side to this for buyers. NOW IS THE TIME TO BUY!!! I can’t tell you how many bargains there are out there. Everyday I see houses that are under market value. Some may need a little work, BUT there are loans available that will include money for repairs. For the homes that need a lot of repair, investors have been buying them up. I deal with investors that are more than willing to buy a house, fix it up and rent it or resale it. They are getting some fantastic bargains.

To me it seems that house investing is a fairly new industry. When I started in the business, foreclosed on homes would sit on the market forever. Now investors are having bidding wars. If you are a non investor, you have to work quick. There are several communities in Pike where people are paying over list price just to win the bidding for recycled home.

Two months ago Pike Township Residents Association asked me to do a presentation on Pike Township Foreclosures. I was thrilled to do so because I have done extensive research. At the beginning of this year I put together a 30 page report called “Tim Lord’s Foreclosure Study for Pike Township, Marion county, Indiana 2006″. The study looked at the 275 houses that went through foreclosure and were resold on the MLS (Multi Listing System). That is where I get my data. I used 4 types of listed houses;

1. Bank Owned
2. HUD Owned
3. VA Owned
4. Pre Foreclosures

Why Pre Foreclosures? Because if they had not been sold as a Pre Foreclosure they would have ended up being foreclosed on and being Bank Owned, HUD Owned or VA Owned.

What is a Pre Foreclosure? Basically a short sale. A short sale is where you get the mortgage company to take less that what it is owed by selling your house under market value. Is it easy to do? In 25 words or less, NO! I have been involved in several of these transactions and it requires a lot of paperwork by the seller, a listing real estate agent who is determined to get the job done and a mortgage company that is willing to take less instead of taking the house through foreclosure. If a mortgage company takes a house through foreclosure it loses about 30 to 35 percent of the loan in expenses. By letting it sell short it only loses about 10 to 15 percent of the loan value.

What I discovered in the report was that the 275 houses (I call them recycled houses because not all of them went through foreclosure) out of the 1370 houses sold in Pike Township in 2006 represented 20 percent of the houses sold. That means that 1 out of every
5 homes sold in Pike Township in 2006 was a recycled home. Then I tested the data for 2007 and discovered that the percentage has gone up and will go up even higher next year. It may reach 30 to 35 percent before it drops. Why? I will talk about that in another posting. Right now I wanted you to see the year after year numbers.

Email me if you would like a copy of my study – tim@LivingInPike.com