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>>DALE: This is Dale Snyder with The Snyder Group at Keller Williams Realty here in Las
Vegas Nevada.
Today's topic of discussion is just going over the current real estate market from a
real estate professional's perspective and from a seasoned attorney's perspective.
Today, we have David Wedemeyer with us from O'Grady & Wedemeyer. He's got over 2,000 closed
short sale transactions. Right now his focus is on the residential market so he brings
a wealth of knowledge to the table. So I'm excited to have him with us today.
>>DAVID: Thanks for having me Dale, I really appreciate you having me here.
>>DALE: Yeah, you bet, I'm excited to have you, as well.
[music]
>>DALE: So real quickly here, I just want to give you a quick snapshot of the market
of what we're seeing in the residential.
So many of you are probably aware, prices are up about 30%-35% in the last twelve to
14 months. You know, inventory's down to about 1 month's supply. Sixty percent of the buyers
are paying cash. Roughly,there've been a lot of changes.
AB-284 a video that you and I have done recently, going over that topic. So feel free to listen
to that. You'll find it in the description below.
We see some drastic changes from AB 284. We just got a lot of stuff shifting. I'm seeing
a lot of marketing stuff out there that led me to reach out to you to get your expertise.
I really entrust your judgement.
So what's going on, just give us a pulse from your standpoint.
>>DAVID: Obviously you're the real estate professionals, you know the market better
than I do. But from my experience and from what I'm seeing you hit it right on the head.
And like you mentioned before AB-284 that we previously discussed that has really put
a kick in the ability for the banks to foreclose on the home.
So that being said, like you mentioned, 1-2 months of inventory, artificially inflates
the prices of the homes right now.
I don't know, you're the real estate professional obviously, but I don't see that trend continuing.
The banks are already starting the NOD process again, they're starting to foreclose on homes
again, get that machine going. And that's just going to lead to more inventory.
Plus, right now, in Carson City, they're talking about maybe amending AB 284, or really the
law that it changed. So they're going to take the teeth, kind of, out of it again and allow
the banks to foreclose a little bit easier. That's what I'm finding. So that being said
-
I don't know, you're the real estate professional but I don't see these - the prices that we
have today,maybe they'll go up a little bit more. I just don't see it continue to grow.
Because there's so much inventory out there - 40,000 to 50,000 homes that don't have power
right now.
And if you're thinking about selling your home, if you're looking to get out of it.
You might not have a short sale right now, we've came across a couple of incidences where
people have come to us and want to short sale their property and after we did a little bit
of investigation, we say, "hey, guess what, Congratulations! You're home is actually worth
more than you owe."
>>DAVID: [laughs]
>>DALE: Yeah, that's right. We've actually cancelled a few of our short sales and turned
them into equities. You know, we started processing them last year, and with prices going up 30%
or so they turn into equity sales.
So with this increase in the Notice of Defaults, and you have so much experience in closing
these short sales. What are you seeing, I know like, what is it Freddie or Fannie? I
always get the two confused.
They're putting their properties up at ridiculous pricings and they're counter-offering a lot
of our short sales at above market price as much as 20%. So what are you seeing on your
end. Because you see a different side of the whole process than we do.
>>DAVID: I wish I could say that I was seeing something different from Fannie and Freddie
but that's just how it goes. Because, you know, short sales take a little bit of time,
regardless of what you've experienced, average is 4 to 6 months but sometimes you can close
them in 30 days. Sometimes they're a little bit trickier, but -
considering, that it might be, let's say you, obviously you have to submit it with an offer.
So that process could take 6 months to get approved, and if the market values go up 30%-35%
one year and the banks are looking at it well, we need a new appraisal, we need a new BPO.
Then it comes in with a new counter-offer like you said, 20% above market value, sometimes
its not quite as high, but what we found is that the market is still so competitive.
There are buyers out there that will close. They'll still come in and pay that premium,
and still allow the short sale to close. It's not the buyers are necessarily walking, especially
if its an institutional buyer, hedgefund, investment...
>>DALE: Yeah, what is it, we have about a billion dollars hedgefund money alone in Las
Vegas looking at buying up property.
>>DAVID: The CFO in my law firm has a meeting with actually, Blackstone, the world's largest
hedgefund, specifically discussing ways to get inventory residential real estate in Las
Vegas.
>>DALE: Yeah, it's definitely a challenge for these hedgefunds to acquire the properties.
I mean, their job is to get the properties, and they already got the money set aside but
securing the property is a challenge.
You know, anything we list I could sell it to 10 personal investors I know. It's an interesting
game we're in.
I want to transition real quick, a lot of what I'm seeing in the news, you know when
I'm driving around the valley, this buyback, these short sale and buyback, I want to get
your take on that.
>>DAVID: Yeah.
>>DALE: It's making our phone ring and it's not even our marketing strategy, so...
>>DAVID: Yeah, its an interesting topic, essentially what it is, it's the HAFA [Home Affordable
Foreclosure Alternatives].
The federal guidelines in terms of short sale approvals and different things like that.
It allows, it requires an arm's length transaction, so basically what that means is that you can't,
the short sale transaction can't be incestuous, you can't sell your house to your brother
for a discounted price, something like that.
But there's a kind of loophole or exception, if you will, within HAFA while its for an
arm's length transaction. If the sale goes through a non-profit, okay? And it has to
be a specific non-profit. That being said, the whole purpose of it is, is that these
non-profits come into blighted communities, people way upside-down in their homes, pay
way too much for their mortgage, and they come back. It has to be HAFA approved it can't
be a jumbo loan. So there are some requirements for it, it's not just you know, find a non-profit
sell your home and then, you do "XYZ".
But they come in, the idea is to buy these properties, and the person who short sold
the property has the option to buy it back three years down the line for current market
value and they get to stay in the home and rent it out. The idea is that the community
stay together and then the people have an opportunity to repurchase the home three years
down the line and maybe have a little bit of equity, or at least not be so far upside
down on it.
But I don't know, I've heard of a couple of people doing it in Nevada.
I've been approached by a couple of different realtors, do you want to be counselled on
it. Do you want to do this?
And I haven't seen anybody really doing it right, okay? I know there's some non-profits
out here that were shut down.
It's a national program, I know it's been successful in some parts of California, I
just haven't seen it. I've had a couple of different people come and talk to me about
it and I've explained the whole process to him and whatnot, and I don't know.
I've spoken with an individual who basically described it as the non-profit was the straw
for the investor who will ultimately get the note...
These are federal guidelines, they completely follow everything else. I don't know. I haven't
heard any great success stories of that yet.
>>DALE: You know, I don't like to be Debbie Downer or a pessimistic but the saying if
it seems too good to be true, it usually is.
You know, it resonated with me when you said "straw buyer," I started having flashbacks
of 0405-06 with some of the stuff that's going on in our market. You know I'm assuming there's
good intentions with that, but it just seems, just seems too good to be true for something
like that to really come to fruition. Because you said it, if it's a non-profit, now how
many non-profits are going to come into our market place and do it as a non-profit?
>>DAVID: And that's a specific non-profit, I'm not talking about any specific non-profit
and a specific entity, or individual who's a proponent of it, speaking from my own personal
experience. I haven't heard of any true success story that I would love, love, love to hear
from.
>>DALE: Yeah, absolutely.
Anything else with that or anything else in the market that you would want to expand on
a little bit?
>>DAVID: Well, if you're thinking about getting off from underneath your home, there's obviously
different laws, mitigation options, you can try to loan mod, at which you just generally
just forbearance agreement you're going to have to pay all that money back and things.
But if you're considering a short sale, it's just a great market to do it in. Though you
still might be upside down, there's a big upswing in the market right now, thus you
know that deficiency balance between what you owe and what you're home is worth has
shrunk.
Banks have the tendency to approve them quicker, like we discussed earlier. There's tons of
buyers out there who would gobble up properties. You have the tax obligation waiver. It's a
very, very good time to short sale if you're considering it.
So it'd be great to either discuss it with your local or with your trusted real estate
professional, someone like Mr. Snyder, or we're always open for free consultations for
everyone who wants to talk.
>>DALE: How do the consumers get in touch with you?
>>DAVID: Well, it's easy. You could either call the number on the screen or you could
reach us on the net at www.OWLawLV.com, one word.
>>DALE: Fantastic.Well, thanks for your time.
You consumers if you'd would like to reach out to us you can find us on our website.
You can all us on the number that's on the description as well.
You know we're here to help. If you have any questions about what is your home worth, what
are your options, you know, we've got a great team in place.