Archive for July, 2010
July 30th, 2010 | 
Author: Report finds most complaints allege disability discrimination WASHINGTON – July 26, 2010 – The Department of Housing and Urban Development (HUD) released the Obama Administration’s first annual “State of Fair Housing Report” on the status of fair housing in America. HUD’s Fiscal Year 2009 annual State of Fair Housing Report highlights the agency’s progress in enforcing the Fair Housing Act, identifies challenges that remain, and demonstrates its commitment to acting now to end housing discrimination.
Discrimination based on a person’s disability status continues to account for the largest single category of complaints. Of the 10,242 complaints filed with HUD and its partners during fiscal year 2009, 44 percent alleged disability discrimination, while 31 percent alleged discrimination based on race, and 20 percent based on family status. The number and type of complaints received are consistent with the previous two years.
“Despite much progress and hard work, Americans continue to face housing discrimination because they’re in a wheelchair, are a different color, or background, or have children,” says John Trasviña, Assistant Secretary for Fair Housing and Equal Opportunity. “This report is a stark reminder that HUD and our fair housing partners must redouble our commitment to end housing discrimination.”
This year’s report highlights some of HUD’s enforcement efforts, including ones that led to a change of policy. The Department also handled discrimination cases that resulted in compensation for the victims. For example:
• HUD charged two Tallassee, Ala., landlords with violating the Fair Housing Act for allegedly forcing a white family to move out of the house they rented to them after the landlords saw the family talking with African-American neighbors in their front yard. Three months after charging the case, HUD obtained a settlement that required the landlords to pay $63,000.
• HUD charged a Puerto Rico condominium association with violating the Fair Housing Act for denying a disabled couple the use of two handicap accessible parking spaces. A HUD Administrative Law Judge subsequently ordered the association to pay $25,000 in damages to the couple and $10,000 in civil penalties for violating the couple’s fair housing rights.
• HUD charged an Atlanta condominium association and a local real estate company and its agent with discrimination for refusing to sell to families with children. The agent advertised a unit and conditioned the sale to those without children.
The report also highlights HUD’s recent efforts to ensure that the agency’s core housing programs are open to all, regardless of sexual orientation or gender identity. Last month, HUD announced that it will now require all applicants for Fiscal Year 2010 grant funding to certify that they have not been charged with a systemic violation of state or local laws based on a person’s lesbian, bisexual, gay or transgender status.
For additional information about Fair Housing, log onto HUD’s Web site: www.hud.gov/fairhousing. To read the annual report, go to: http://www.hud.gov/content/releases/fy2009annual-rpt.pdf
© 2010 Florida Realtors®
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CNN Money poll: Top 25 towns with affordable homes ORLANDO, Fla. – July 26, 2010 – CNN Money magazine has released its annual poll of some of the top places to live, and two Florida cities rank high as towns where residents’ income goes furthest when it comes to home purchase power.
Among CNN Money’s top 25 list for where homes are affordable, Deerfield Beach ranks No. 1 and Deltona is No. 4. Here’s what the magazine had to say about the cities:
No. 1, Deerfield Beach: With a median home price of $67,000 and a median family income (per year) of $56,519, residents here can find three-bedroom waterfront property for under $400,000. The beaches in this South Florida community are beautiful and completely open to the public; residents also are within easy driving distance of Fort Lauderdale or Miami for major league sports, entertainment and other amenities.
No. 4, Deltona: With a median price of $80,473 and a median family income (per year) of $56,907, house hunters here find properties for less than half the prices paid several years ago at the peak of the market. Located about 30 minutes from Atlantic Ocean beaches and within an hour’s drive of Walt Disney World, the area’s lakes offer boating, sailing and bass fishing.
View the rest of the top 25 list.
© 2010 Florida Realtors®
Viral email raises real estate tax fears WASHINGTON – July 26, 2010 – A viral email that keeps circulating seems to die out but then returns with a vengeance. Florida Realtors and the National Association of Realtors have received numerous calls from concerned members.
The email incorrectly states that “all real estate transactions will be subject to a 3.8% sales tax.” It then goes on to blame Democrats for inserting the language at the last minute into the recent health care package. To back up the email’s message, it includes an attachment that looks like a newspaper article from the Spokesman-Review, a Spokane, Wash., publication.
Part of the email is true: There is a new real estate tax that will help pay for Medicare, but it impacts a very small number of people. It applies only to sellers making more than $200,000 per year or $250,000 for couples.
The email fails to include information on the article, however, which is actually an editorial opinion of an outside writer and not a news piece. It was written by a representative of The Washington Policy Center (http://www.washingtonpolicy.org/Centers/healthcare/index.html), which includes a link on its website outlining the group’s stance on health care reform.
The National Association of Realtors has created a page explaining the new law that includes rebuttals of the false email. It can be found here.
A Washington Post article created a fictional couple with a joint income of $300,000 (over the $250,000 limit) that made a $600,000 profit on a home sale. In the example, the couple could pay a new real estate tax equal to about $1,900. Read more about the Washington Post example.
© 2010 Florida Realtors®
ORLANDO, Fla., July 22, 2010 – Sales of existing homes in Florida rose 15 percent in June, marking 22 consecutive months that sales activity has increased in the year-to-year comparison, according to the latest housing data released by Florida Realtors®.
A total of 18,038 single-family existing homes sold statewide last month compared to 15,732 homes sold in June 2009, according to Florida Realtors. June’s statewide existing home sales increased 7.7 percent over statewide sales activity in May. Meanwhile, last month’s statewide existing-home median price of $143,400 was 2.1 percent higher than May’s statewide existing-home median price of $140,400. It marks the fourth month in a row that the statewide existing-home median price has increased over the previous month’s median.
Fifteen of Florida’s metropolitan statistical areas (MSAs) reported higher existing home sales in June, while 16 MSAs posted increased existing condo sales. A majority of the state’s MSAs have reported increased sales for 24 consecutive months.
Florida’s median sales price for existing homes last month was $143,400; a year ago, it was $147,700 for a decrease of 3 percent. The median is the midpoint; half the homes sold for more, half for less.
The national median sales price for existing single-family homes in May 2010 was $179,400, up 2.7 percent from a year earlier, according to the National Association of Realtors® (NAR). In California, the statewide median resales price was $324,430 in May; in Massachusetts, it was $299,000; in Maryland, it was $249,177; and in New York, it was $194,900.
More jobs are key to the continued recovery of the housing market, according to NAR’s latest industry outlook. “If jobs come back as expected, the pace of home sales should pick up later this year and reach a sustainable level of activity given very favorable affordability conditions,” said NAR Chief Economist Lawrence Yun. “We’ll also keep a close eye on market conditions on the Gulf Coast.”
In Florida’s year-to-year comparison for condos, 6,916 units sold statewide last month compared to 5,215 units in June 2009 for an increase of 33 percent. The statewide existing condo median sales price last month was $95,000; in June 2009 it was $112,800 for a 16 percent decrease. The national median existing condo price was $181,300 in May, according to NAR.
The interest rate for a 30-year fixed-rate mortgage averaged 4.74 percent in June, down from the 5.42 percent averaged during June 2009, according to Freddie Mac. Florida Realtors’ sales figures reflect closings, which typically occur 30 to 90 days after sales contracts are written.
Among the state’s larger markets, the Tampa-St. Petersburg-Clearwater MSA reported a total of 3,226 homes sold in June compared to 2,848 homes a year earlier for a 13 percent increase. The market’s existing home median sales price was $138,400; a year earlier it was $139,400 for a decrease of 1 percent. A total of 912 condos sold in the MSA in June compared to 671 units sold in June 2009 for an increase of 36 percent. The existing condo median price was $99,100; a year earlier, it was $113,300 for a decrease of 13 percent.
© 2010 Florida Realtors®
HUD investigation: Pregnancy discrimination WASHINGTON – July 22, 2010 – The U.S. Department of Housing and Urban Development announced yesterday that it will launch multiple investigations into the lending practices of some mortgage lenders to determine if they illegally denied mortgages because the mother was pregnant or a family member had a short-term disability. The action follows a report published this week in the New York Times outlining lending practices that possibly violate the Fair Housing Act.
“Denying a mortgage to people just because they’re having a baby is flat wrong,” says Vice President Joe Biden, chair of the White House Task Force on Middle Class Families. “Mothers on maternity leave have jobs, they have income, and they shouldn’t have to lose their deal to close on a house because they had a baby.”
“Lenders have every right to ascertain the incomes of families to determine whether they are eligible for a mortgage loan, but they have no right to use a pregnancy or a short-term disability as a cause to deny that family a mortgage they would otherwise qualify for,” says HUD Secretary Shaun Donovan. “Having a child should be a time for a family to celebrate and must not be a cause for unfair lending practices.”
HUD enforces the Fair Housing Act that prohibits discrimination in lending based on sex, familial status (pregnancy or children in the family), or disability. The Act protects consumers from discrimination based on a borrower’s maternity leave if the borrower can demonstrate that she intends to return to work and otherwise continues to meet the income requirements to qualify for the loan.
However, a published report in the New York Times indicated that some mortgage lenders may be denying credit to borrowers because of a pregnancy or maternity leave.
“This report is profoundly disturbing and requires immediate action,” says John Trasviña, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity, the office that will direct the investigations. “Lenders must not carry out due diligence responsibilities in ways that have the practical effect of discriminating against recent or expectant mothers.”
HUD’s Federal Housing Administration (FHA) requires its approved lenders to review a borrower’s income to determine whether they can reasonably be expected to continue paying their mortgage for the first three years of the loan. FHA-insured lenders cannot, however, inquire about future maternity leave.
If a borrower is on maternity or short-term disability leave at the time of closing, lenders must document the borrower’s intent to return to work, that the borrower has the right to return to work, and that the borrower qualifies for the loan taking into account any reduction of income due to their leave.
Meanwhile, HUD is also reviewing Fannie Mae and Freddie Mac’s underwriting guidelines to determine if they satisfy the Fair Housing Act, including income verification of persons taking parental or disability leave.
© 2010 Florida Realtors®
Home Owners’ Associations have been struggling to collect fees from non-owner occupied properties. In many cases, the HOA can place liens on the property and foreclose on the property to collect the HOA dues.
The new law will allow HOA’s to collect their fees directly from the tenant, with the remaining balance of the rental payment going to the owner.
Click here for the full article and details.
NSP grantees get first chance to buy HUD Homes at 10 percent discount WASHINGTON – July 13, 2010 – The U.S. Department of Housing and Urban Development (HUD) announced a new initiative for state governments, local governments and nonprofit organizations participating in HUD’s Neighborhood Stabilization Program (NSP). Going forward, the groups will be given preference to acquire homes from the Department’s inventory of foreclosed properties, commonly known as “HUD homes.”
The FHA First Look Sales Method, HUD will offer NSP grantees a preference (“First Look”) to acquire available HUD homes within the defined boundaries of NSP-designated areas. Furthermore, First Look will provide NSP purchasers with the opportunity to purchase FHA properties at a discount of 10 percent below their appraised value, less the cost of any applicable listing and sales commissions.
A Notice outlining the temporary initiative will be published this week in the Federal Register, outlining the rules for buying HUD homes, which fall under the Federal Housing Administration’s (FHA’s) First Look Sales Method, before they are marketed to other purchasers.
“This First Look initiative is a marriage of two programs to accelerate our effort to confront property abandonment in communities struggling to overcome the effects of the foreclosure crisis,” says HUD Secretary Shaun Donovan. “By essentially giving our NSP grantees a first bite at the apple, we hope to accelerate the sale of FHA’s foreclosed properties while supporting the Obama Administration’s neighborhood stabilization efforts.”
The FHA-NSP First Look period will last approximately 14 days from the conveyance of a property to FHA. Properties that remain unpurchased at the expiration of the First Look period will be listed and sold according to standard FHA procedures. Eligible NSP grantees may acquire these properties with the assistance of NSP funds for any eligible use under NSP, including rental or homeownership. This sales method becomes effective immediately and continues through May 31, 2013.
© 2010 Florida Realtors®
Some banks lower appraisals, killing sales WASHINGTON – July 13, 2010 – It’s a common Realtor complaint: A property going to contract appraises for less than expected. The buyer cannot put more down; the seller will not lower the price; the sale falls apart.
In some cases, however, the appraiser is not the cause. Banks – fearful of Fannie Mae and Freddie Mac policies that mete out punishment if a house is over-valued – err on the side of caution by shaving value off the appraisal. If guilty of price inflation, they could be forced by Fannie Mae to buy back the mortgage at a substantial cost. By dropping the appraisal value, they hope to avoid any suggestion that they inflated the numbers.
Frank K. Gregoire of St. Petersburg, vice chairman of the National Association of Realtors’ Appraisal Committee, calls the problem widespread. Many sales are “sabotaged by lenders and underwriters arbitrarily reducing the (appraiser’s) value estimate.”
According to Gregoire, many lenders try to double-check an appraiser’s work by ordering a low-cost electronic valuation. The electronic version uses only readily available public records and no on-site inspection, making it less reliable than a true appraisal. However, banks many times get scared if the electronic version is lower than the physical version, and they downgrade the true appraisal value to protect themselves. At other times, they ask the appraiser to explain the price difference, which can also delay closing.
The rules are about to change
Recognizing a problem, Fannie Mae instituted a new rule that becomes effective on Sept. 1. After that date, banks selling their loans to Fannie Mae can no longer simply drop the appraisal value. In guidance issued June 30, Fannie Mae told its participating lenders that they must contact the appraiser to “resolve” disagreements. If that fails, banks must order a second appraisal. In either case, lenders cannot simply drop the original value that supports a sales contract.
A number of appraisers hailed the change as great news.
Pat Turner, an appraiser in Richmond, Va., said that electronic appraisals don’t consider property condition and “are often inaccurate.” According to Turner, he once did a physical appraisal of a property that a California-based firm also did electronically. Afterward, the lender’s review company asked Turner why he did not use one of the comps the electronic firm used. Turner investigated and said he found out that one “comp” was actually a vacant lot, and worth far less than the property being sold.
Fannie Mae’s rule change also attempts to deal with other appraiser complaints, such as the use of inexperienced appraisers who travel to unfamiliar territory by clarifying “appraiser selection” standards.
Fannie Mae and Freddie Mac back about half of all U.S. mortgages, and Freddie Mac officials, when asked about Fannie Mae’s announced rules, said they’re “looking at it.”
Source: Kenneth R. Harney
© 2010 Florida Realtors®