Living in Portland

In the City of Portland you can go to their web site www.PortlandMaps.com and look under crime.  This is map driven and will allow you to look at specific addresses.  For the rest of the Metro Area you can go to this national site which also allows you to compare one City against another.      http://www.areaconnect.com/crime/compare.htm

In simple terms, a short sale occurs when the seller of a property owes more than the property is worth.  The property may or may not be in the process of foreclosure.  Agents often list ’short sale’ properties on the MLS but they do have to clearly state that fact.

Are these a good deal?  NO, and here’s why.  The Seller can basically accept any offer he deems reasonable but in reality, he doesn’t have the authority to sell the property.  The ultimate approval is with the bank, and if there is a second mortgage (which is often the case) then two banks are involved.  Banks don’t like to loose money even if the property is in the process of foreclosure.  Adding to the mix is the fact that if the first mortgage bank forecloses, they receive more money because the second mortgage bank gets nothing.  In a short sale negotiation, both banks have to agree on how much money they will each receive AND the closings costs which include real estate commissions have to be paid first. 

In my 17 years experience, I have yet to have the banks agree to anything prior to the closing date.  The Buyer is left to gamble the cost of the inspection and the appriasal (approx. $900.) in hopes that the deal will close.  The Buyer is also gambleing that the sale will close on time and before his 30-day interest rate lock expires.  Banks don’t care about the Buyer’s out of pocket expenses or their interest rate lock, so the Buyer is at the complete mercy of the process (incredibly stressfull).  If the Buyer has given notice to a landlord or sold their previous home, there is also a good chance that they will be homeless during this waiting period.  I have seen the closing date go beyond 30 days many times as well as never closing at all!

My advise, never try to purchase a short sale.  Wait until the property has been fully foreclosed and is owned by the Bank.  Pre-foreclosures are even worse  than short sales.

In Portland Oregon new standards are being set when it comes to selling or buying a home, most informed buyers are requiring that you first have a sewer scope, this process is complete after a small camera is fed through the existing line exposing any Gaps, breaks, pooling, or root intrusion and also determining the overall quality of your line as well as to look for signs of a “Party Sewer”. When more than one house’s sewer lines connect together before reaching the city mainline it becomes a “Party Sewer”.

I have witnessed a scenario unfold too many times to count where a new homeowner finds themselves with an unsuspecting 6-15 thousand dollar bill at their feet. This all could have been avoided by insisting on a sewer scope before the purchase of their new home. What happens is a sewer line backs up at your neighbors house, they do a sewer scope to determine what the problem is and find out that they are hooked to a “Party Sewer” with you. The city requires them to run a new line to city mainline leaving you high and dry with the city knocking at your door telling you to do the same.

I encourage all future home buyers to find a local contractor to perform a sewer scope (approx. $99.)before signing papers on your new home. It will give you peace of mind and could be a bargaining chip when negotiating a price.

If you have mortgage insurance on your home loan, there are two very important things you should know:

First, the reason you were required to have mortgage insurance in the first place was because the ‘Loan to Value’ was greater than 80%.  Loan to Value is the difference between the market value of your home and the loan balance.  What most people forget is that the value of your home is going up every year.  (In Portland it went up 14% in 2006).  Once you hit the 20% equity position, you can contact your lender and ask to have the mortgage insurance payment dropped (most payments are over $100/per month).  They may require you to have an appraisal to document the value, but this is money well spent (usually $350.).  By law, after you have had your loan for two years, and you can document the value, the bank is required to remove the payment.  But remember, Banks don’t want to give up that money.  They will never contact you regarding the payment removal and may even argue about the two year law.

Second, for the tax years2007 thru 2010, mortgage insurance payments will be a tax deduction just like interest.  This is a one time thing, so be sure to look and your monthly statement to determine whether or not you are paying monthly mortgage insurance.

Coming off a somewhat slow 2007, I see 2008 shaping up just like any other year.  We usually start getting busy by the end of February and are in full swing by March.  As a Buyer Agent my business this year is right on track if not a bit ahead.  I talk to other Agents all the time and have found that they are experiencing the same up-tick in business.  I’m beginning to think that we have hit bottom as far as the slow down and are now on our way back to a normal market.

As everyone knows, Portland was one of only three major cities to show real estate appreciation in 2007 (Seattle and Charlotte, NC).  Even though our values held, we saw fewer homes sell.  Our inventory is at an all time high of twelve months, making this a Buyers Market.  You may want to know how Portland can be appreciating with so many homes on the market?  The answer is quite simple.  First, Portland did not experience the huge jumps in appreciation that other areas did.  We tend to be conservative and keep a sense of ‘normal’ when it comes to real estate.  The second reason is, what is selling is the ‘good stuff’.  By that I mean great houses in great condition, priced at market.  Buyers are willing to pay a fair price for a great property.  What isn’t selling is the overpriced properties and those that are frankly in bad shape.  No one whats to buy garbage.  The third reason is the fact that Portland has an urban growth boundary.  We have and always will have a limited supply of homes.  Match that with the fact that our population is still growing and you have a recipe for a health real estate market.

If you are paying PMI on your home loan, there’s a chance it can be tax-deductible.  There are several conditions that must be met including having the loan close since January 1, 2007.  There are also adjusted annual income caps. This can be for a purchase or a refinance.  If it is a refinance, there are additional conditions that should be verified with your accountant.

Mortgage Insurance is insurance most lenders will require when the borrower takes out a loan that is more than 80% of the purchase price or value of the property.  This iinsures the loan in case the borrowers default.  Premiums can run 0.5% - 0.75% of the loan balance per year and is divided into monthly payments.

Removing ceiling asbestos before selling your home can be a plus to the Buyer and may improve the value of your home.  The process can be messy and time consuming, so professional removal is probably best for most homeowners.

There are guidelines governed by the Environmental Protection Agency for the removal of asbestos.  It can be professionally removed and their website refers to professionals that specialize in this work.  It can also be a do-it-yourself project.  For more information, go to their website at:  www.epa.gov.

Those of you who registered when the list was first started back in 2003, will need to reregister every five years.  To verify when, and if your number is listed go to Do Not Call, and check on verify a listing or register a listing.  Don’t forget to add your cell phone numbers!