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Real Estate News Releases
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(EMAILWIRE.COM, August 07, 2008 ) In a survey conducted by Harris Interactive for website www.Zillow.com most American homeowners believe that their homes have not lost value in the past twelve months despite much market data to the contrary.
A full sixty-two percent of American house owners believed that the value of their home increased or stayed flat during the past twelve months. Market data shows that only twenty-four percent of homeowners actually have objective reasons for believing that. Further analysis of real estate data for single family homes shows that approximately seventy-seven percent of US homes have lost value in the past twelve months.
The homes that have held their value the most are located on the
East and West coasts in urban areas, while the homes that have lost the most value are located in states like California and Florida that saw massive amounts of homebuilding activities during the early years of this decade.
Foreclosures continue to mount across the nation and some economists and market watchers predict that the havoc inflicted on the real estate market because of the subprime mortgage default wave will be added to when loans made to more credit-worthy borrowers such as Alt-A borrowers and Prime borrowers begin to go into default in greater numbers in the months to come.
One real estate and foreclosure expert, Patrick McGilvray, president of www.TheHomeBuyingCenter.com, an internet-based company that connects real estate investors with home sellers and people looking to buy a foreclosure home, mentioned that his company talks with dozens of homeowners every day who are hoping to sell a house fast for a cash offer from a real estate investor to avoid losing a home to foreclosure or because they think they cannot quickly sell a house on the regular real estate market. McGilvray said that many of these homeowners, especially those who have purchased homes in the past four years owe more than their homes are worth or exactly what their homes are worth.
“The problem,” he added, “is that people who used one hundred percent financing or lied on their mortgage applications about their income or net worth have no room in their budget to accommodate a falling home price. Many of these people can hope for a short-sale, but the odds are against them, especially if they do not act quickly and reach out for help from knowledgeable professionals.”
The short-sale phenomenon that McGilvray mentioned is when a bank agrees to allow a home to be sold to a new buyer for less than the amount of money owed on a mortgage. The incentive for the banks to do such a thing is that they will probably lose less money if they permit a homeowner to list a home with a realtor in their area on their own and field a
“The problem with short-sales,” said real estate agent Mary Hargraves of Stockton, California, “is that many banks are in just as much denial as the homeowners who are unable to make their mortgage payments. They don’t want to admit that they loaned far more than the home was worth in the first place and they want to avoid the pain. Unfortunately for homeowner and lender many of these homes end up in foreclosure which hurts everybody, including the community where the home is located.”
Even in the Bay Area of California, home to Silicon Valley, San Francisco, and Marin County where real estate prices have zoomed to stratospheric heights in the past decade, prices have fallen significantly. According to the S&P Case-Shiller index of home prices prices have fallen from May 2007 to May 2008 22.9 percent.
McGilvray added in closing that the best strategy that homeowners can adopt in today’s market is to price their home far below comparable homes for sale in their area and hope that enough buyers will be motivated to make offers that an auction type environment can be created that will jockey up the final offering price of the home. “It works for the auction companies to get buyers emotionally stirred up, so regular homeowners should take a page from their playbook.”
www.TheHomeBuyingCenter.com
Patrick McGilvray
916-821-6200
patrick @ thehomebuyingcenter.com 
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