What is New Hampshire’s Current Use Law?

By Dick Thackston

On July 1, 1973 the Current Use Law became effective in New Hampshire.  The Current Use law was designed to keep New Hampshire’s rural character in tact while allowing owner’s to use the land quoting from the preamble to the law itself: “It is hereby declared to be in the public interest to encourage preservation of open space, thus providing a healthful and attractive outdoor environment for work and recreation of the state’s citizen’s, maintaining the character of the state’s landscape, and conserving the land, water, forest, agricultural and wildlife resources.”

The effect of the Current Use law has been to provide a lower tax rate on larger tracts of land so that property owners would not be forced to subdivide and sell off their property in order to cope with large property tax bills. By keeping land in an undeveloped condition family farms have been preserved as well as woodlands, wet lands and other tracts that might well have been lost over the last thirty-nine years.

Over half on the land in New Hampshireis enrolled in the Current Use program and it has been the foundation of the State of New Hampshireprivate property based land conservation program.

The following are characteristics of the State of New Hampshire’s Current Use Program:

Generally speaking a parcel must be of at least ten acres, exceptions to this are wetlands of any size, tree farms of any size and parcels of less than ten acres that produce more than $2,500 in agricultural products. Open undeveloped land that is less than ten acres as well as any area covered by buildings does not qualify for Current Use.

If an owner acquires abutting parcels of less than ten acres the additional parcels can be added and would qualify for Current Use or if an owner has a number of abutting parcels of less than ten acres each but the entire contiguous amount owned is ten or more acres then the property is eligible for Current Use.

What is a contiguous parcel? Contiguous parcels under the Current Use Law are defined by the NHSPACE.org website as “more than one parcel of land, which is connected, even if a highway, rail bed, river or water body divides it. This means land that touches any of your property boundaries, or is across the road or on the other side of a pond, stream or river, on both sides of railroad tracks, or across a political boundary.”

If a property owner enrolls his property in Current Use it does not mean his land is now “Open to the Public”. When a property owner enrolls his property in Current Use it is still private property – remember the focus of this law has been keeping New Hampshirelarge undeveloped tracts in private hands – the property owner still has the right to determine how his property will be used just as he would if it were not in Current Use.

For more details on New Hampshire’s Current Use Law visit NHSPACE.org

Strange, but True: Your House Price Drops but REO Properties go up in Price!

By Dick Thackston

According to several industry sources the average value of bank owned, REO Properties, has actually increased in the last years while the value of non-bank owned real estate has dropped on average! There are several reasons in the realm of conventional wisdom as to why this is happening; the most common reason given is that REO properties are being bought up by investment groups and turned into rentals thus driving up the price of REO’s on average. While this certainly is a factor there are other factors that are probably more important to the change in real estate values that I see happening as a “boots on the ground REALTOR”.

Here’s how I see it. The initial wave of foreclosures was for the most part badly maintained and marginal properties: no real surprise that the most marginal home owners were the least able to maintain and upgrade their homes and least able to hang on through tough, tougher and tougher economic times. These homes languished off the market as so called “shadow inventory” for months and in many cases years due to a hostile regulatory and legal environment in which mortgage holders found themselves, thus slowing up the process of foreclosure, resale and return of these residential assets to productive use. No news there really. What the facts recently made public noted about rising REO prices and declining price on non-bank owned real estate indicates is not that we are “moving toward the middle” but in-fact indicate that we are continuing to crater the housing market in slow motion.

This pattern of rising REO value reflects exactly what many experienced REO REALTORS have noted over the last six to nine months: we are getting better quality inventory. The better quality inventory is the result of the economic damage moving up the food chain from the economic bottom into the middle and above. The middle class buyer that bought his house at a fair market price in 2009 is likely to find that when he goes to sell his home today it’s worth the same or a little less and that any improvements he made have added little or no value. So, if they can’t hang on and they can’t sell they let it go. Thus leading to a better class REO property and putting further and continuing pressure on the middle of the market.

What does it all mean? It means that there is no foreseeable improvement coming for non-REO properties and that REO properties will continue to dominate the residential real estate market. Warren Buffet is right: single family homes are likely to continue to be an excellent investment for those who can “buy and hold” but only for those who can buy and hold either as owner occupants or as investors looking at increasingly higher and higher rents over the foreseeable future.

 

ServiceLink and PartnerFirst recently announced a renewal of their agreement in providing solutions for the nation’s housing crisis.

CORONA, Calif., March 12, 2012 /PRNewswire via COMTEX/ — PartnerFirst is pleased to announce the renewal of its contract with ServiceLink as its nationwide short sale agent network. Through this alliance, now entering its third year, thousands of distressed homeowners can use PartnerFirst agents to resolve their mortgage problems.

PartnerFirst powers the ServiceLink Short Sale Agent Network which connects distressed homeowners with qualified real estate professionals. Through its education platform, including the Pre-foreclosure Specialist Certification (PSC), PartnerFirst educates agents to help distressed homeowners.

Regarding the ongoing alliance with PartnerFirst, Leo Esposito, ServiceLink’s Senior Vice President of Loss Mitigation and Asset Disposition, said, “ServiceLink is pleased with the agent education services and the quality of agents provided by PartnerFirst to power the ServiceLink Short Sale Agent Network. This marks the third year that the two firms will be working together to achieve solutions for the nation’s housing crisis.”

ServiceLink, the national lender platform of Fidelity National Financial, has managed over $10 billion in short sale transactions, working with five of the nation’s top ten lenders. With its experience in working with lenders, investors, mortgage insurers, and junior lien holders, ServiceLink has the flexibility to provide efficient solutions and expeditious closings.

The short sale alternative preserves neighborhood values, minimizes loan loss severities for investors, and provides a dignified resolution for distressed borrowers.

For more information, or to sign up as a ServiceLink short sale agent, visit: http://www.servicelinkfnf.com/downloads/ShortSaleAgentPackage.pdf .

SOURCE PartnerFirst

 

Im From the Government and Im Here to Help! (Not a shot.)

By Dick Thackston

Ronald Regan made the now famous statement about thirty years ago that the phrase “I’m from the government and I’m here to help”, was a phrase that Americans everywhere have learned to fear. The current mortgage/housing/financial crisis has only reinforced that view for many of us that have had to deal with the destruction of the American dream since this economic debacle began in 2005.

It is clear to me from my day to day dealings with home owners and former homeowners that the government most assuredly is not “here to help”. A big part of my business has become handling cash for keys for banks. Cash for Keys or Relocation Assistance Programs run by lenders to help the occupants of foreclosed properties find a new home and move. The programs are for the most part well run and helpful to the occupants. I do about two or three of these a week. Here’s the way the government “help” becomes tragic: almost everyone of the people I talk to has applied for assistance under the HAMP or HAFA programs offered by the government; almost no one has benefited from these programs; almost all the people I’ve spoken with in the course of doing Relocation Assistance for lenders would have been better off had they never heard of these programs and several have been the victims of outright fraud.

Example: I spoke with a local family last week that has lived in their home for about nine years. They never refinanced, they never took out a home equity line of credit. They have three small children two under the age of five. Over the last nine years they have worked on their home fixed it up as they went along. Early last year the husband lost his job in construction, so he took a job that didn’t pay as well at a fast food place and the wife went to work part time and they burned up some savings but kept their house payments current – they need a place to live, right? They struggled along and they called their mortgage company; their mortgage company told them to apply for the HAMP program. They didn’t understand what it was so they went on the internet and found an attorney that advertised he would help them negotiate the process. They sent their full mortgage payments to him; he was to get the loan modified; after the fourth mortgage payment was taken out of their account sent them an e-mail and said there’s nothing else he can do; house went to foreclosure. Fundamental problem is the creation of false hope by the HAMP program which a reasonable person will see is non-workable so they hire someone who must be “smarter” than them to set it up, unfortunately he was just a crook.

Example: I spoke with a couple in their early sixties; they’ve lived in their home for 31 years; they raised their kids and ran their business from their home all that time. They got behind on their mortgage when their small business started to fail in mid 2007. They struggled to keep things afloat and did. They contacted their mortgage company to see if anything could be done after meeting with local REALTORS about selling their home; they were surprised at first to find that they owed more than their home was now worth and that there was “no way” they could sell their home without having a substantial deficiency due to the bank. They became aware of the HAMP program and decided they would try the program. They were told that they no longer “qualified” for the amount of the mortgage they had and in order to complete the program would have to bring money to pay down the loan amount. Seriously?

Reality or Fear Based View of Real Estate in the US The Choice is Yours.

By Dick Thackston

Prior to 2007-2008 most of the American public and most mortgage lenders believed, and often would state in conversation, “real estate never goes down!” Since that time frame buyers and sellers have gone to the other extreme and now the common wisdom is “real estate will never go back up.”

Well never is a long time. Both perspectives are wrong.

For the last several years we have been pummeled for a seemingly continuous stream of negative events: tidal wave and earthquake in Japan, un-employment over 10%, European Debit crisis looms as Greece nears default on its debt, (The last one just kills me: the entire GDP of Greece in 2010 – $310 Billion +/- – is approximately the same as the State of Maryland in 2010 – $300 Billion +/-. Do we actually believe if the State of Maryland defaulted there would be a worldwide financial crisis?), and each of the events has run a shock wave through people’s emotions which does affect their willingness to make the long term commitment to home ownership. It’s not reality! Fear sells newspapers, magazines and broadcasts. Fear does not ever produce the best results or good decisions.

Truth be told, the down turn in housing started in the third quarter of 2005. In June of 2005 the Fed bumped rates up in order to stimulate “a soft landing in housing” the curves between housing units sold and housing prices began to diverge at that point with house prices continuing to increase for another two years, while units of sales began to decline at an ever increasing rate. By the time the reality hit it was already too late. That being said, let’s look at the sunnier side of the situation. All of this is clearly tracked by something called the Housing Affordability Index published by the National Association of REALTORS.

The Housing Affordability Index has two basic components: average mortgage rates and average house prices which is then compared to the average household income. The higher the number, the easier it is for people to buy homes, and the lower the number, the harder it is for people to own homes. The number is designed to indicate how affordable the median home is to the median income family in the United States. An index of 100 means that the median income household has exactly enough income to afford the median income home; when the index is greater than 100 then the median household has more than they need to purchase the median home and when it’s below 100 then they don’t have enough. (When I started selling homes in Pasadena, Maryland in 1982, the Housing Affordability Index was well below 100 due to very high interest rates, in the 13-15% range). Today due to all the price declines and interest rates being at historic lows, the Housing Affordability Index has soared to a record high number well over 100.

So what’s the point? The point is that a balanced perspective and a positive outlook on life are the key to making good decisions in housing as well as in other areas of ones life. Scientific studies have shown, (See Dr. David Lykken’s work), that your happiness set point is about 50% genetic and the rest is up to you. There can be little or no doubt that the homes that are being purchased today at historically low interest rates and the lowest prices in a decade or more will fuel the American economic powerhouse in a few years – so be positive, keep your perspective and never say “never”.

2012 is a Buyers Market! Six Tips to Keep in Mind if You are Using a Buyer Broker:

By Dick Thackston

So, 2012 looks like maybe hone buyers will be back out seriously looking at homes which means the whole issue of buyer brokerage will soon be among us again with untrained agents trying to represent buyers again. Thinking about that, I have created a six point template that every buyer thinking about getting a buyer broker should consider. Buyer brokerage is not for every buyer and/or every agent, and I believe all of these points should be considered before any buyer agency agreement is signed. Be sure the arrangement works for you!

POINT# 1: Value: Will hiring a buyer broker actually create value for either party? Do you as the buyer actually plan to guarantee a buyer brokers compensation? Do really plan to buy a home through this buyer broker and only this buyer broker or do you plan to drift into open houses and call on ads that you see in the paper, or on line, or in homes magazines, directly to whoever ran the ad? As a buyer broker do you actually believe that this buyer will actually follow through with their obligations to you? As a buyer broker will you actually follow through with your obligations to this buyer or are you playing the game of you pretend that they will honor the contract and they pretend you’re actually doing any work for them when in reality you’re both fibbing?

POINT# 2: Effectiveness: It is very important that both the buyer and the agent view this as an effective relationship and both understand its boundaries. Do you as a buyer actually believe that you will get better representation, (any representation), by contracting with a buyer’s broker? Do you think you’d get a better price and terms than if you dealt with the listing agent directly? As a Buyer Broker do you actually think you’re going to make more money than if you just sold the house as a Facilitator/Sub-Agent/Transactional Agent? As an agent are you prepared for the long term liability and lawsuits or is that “my broker’s problem”.

POINT# 3: Contact & Skills: Do you as a buyer actually think this buyer broker knows any more than you do? Have they even looked at the listing on line? Will they put you on a search that is simply an automated feed from the MLS or will they call you and track properties that you have expressed an interest in? If they are tracking properties for you how will they do so? Will they develop a spread sheet that shows the properties you’re evaluating with notes and comparisons or will they just “remember what’s important”? When and how will you be in touch with each other?

POINT# 4: Best Properties: Will the buyer broker be committed to getting the buyer in front of the best properties? Will they put the client’s interest in front of their own? Will the buyer be prepared to act when good properties are available? Is the buyer prepared to provide confidential financial information to the buyer broker and get pre-qualified by the buyer broker’s chosen lender?

POINT# 5 Long Term Relationship: Is this relationship going any place long term? Can the buyer and the agent see themselves working together long term? Will the buyer be sending referrals to the buyer’s broker? Will the agent be following up on post closing issues, i.e. errors in the Seller’s Disclosures, Mechanic’s Liens, boundary disputes etc.?

POINT# 6 Timeliness: Is this the right time for the buyer to higher a buyer’s broker or have they already entered into an agreement to purchase and now should really be hiring a lawyer to fix it or litigate it? Does the agent really feel they are entitled to a fee or are they just “trying to make a quick buck”?

Is the Ice Breaking for Home Builders?

By Dick Thackston

The National Association of Home Builders maintains indices that measure conditions for the home building industry. There are three basic measures that the NAHB looks at as measure of were the home building industry is at: traffic visiting model homes, current sales conditions and the most subjective of the three expectations for the next six months. When you look at these numbers 50 is the benchmark number anything under 50 is poor any thing over 50 is good.

Conditions have shown improvement over the last four months.

Last month’s traffic visiting model homes increased from 18 to 21; an increase of about 20% and similar to what we have seen in the “re-sale” home market. (Keep in mind its still winter in the northeast and this is not prime home selling season- really very dramatic news!) Last month’s number for current sales conditions moved from 22 to 25 which measures factors such as availability of financing, terms, interest rates and available inventory among other things and expectations for the next six months moved from 26 to 29.

The NAHB also looks at these number by census regions rather than state by state or just the nation in aggregate. The Northeast moved the most from 14 to 23 and the Mid West moved the least from 23 to 24. It’s probably worth noting that the mid-West has been one of the least impacted regions of the country in our now five + year old real estate downturn.

The South is considered the most important number for the nation and the association because it by far the largest region for population and business in the country. The South moved from 25 to 27. The West moved from 16 to 21.

Obviously, our primary/only concern is the Northeast which includes New England, (New Hampshire, Massachusetts, Vermont, Maine, Rhode Island and Maine). Prospects remain positive and cautious on all fronts in the real estate world and the “all clear” is by no means appropriate at this time. These are not great numbers but they are significantly less bad than the numbers of the recent past and may/hopefully reflect an upward trend that will be unfolding over the next several months as weather improves and the situation becomes clearer to all on employment and other investments besides real estate.