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Monumental Step Forward?

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Terrel L. Shields said:
Boy, would I like to know too. Near me is a new 94 acre sale- $1.3 million. It sold for $325k 10 years ago. Builder bought it. He also bought a 13 acre parcel not far away with a new metal shed for $200,000...the land bought in 2019 for $60k and the building built - probably $50k no more- and now on the market again for ? but Rocket has a Zillow like website claiming it worth $600,000... no way. Another, a mile away, bought 22 acres for $309,000. Supposedly to build an RV park?? No more than dirt work started it came a huge rain and flooded the site, and they found half the site is wet. I could have told them, before that land was cleared, the owners had grown green beans and it would get so wet, they couldn't plant nor harvest the crop every time. So they abandoned the field... The equipment is gone and dirtwork suspended until summer I presume.

I have another - an old house, poor condition, split into 5 apartments. Contract above listing price, and not gonna come in anywhere near asking. Short remaining life.
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Money laundering ? Tax shelters ? Investments for foreigners under LCC or corporate umbrella ? Control of product supply so they can charge any sale price or rental they want ?

Idk but sad to see it encroaching on res home ownership -
 
J Grant said:
Money laundering ? Tax shelters ? Investments for foreigners under LCC or corporate umbrella ? Control of product supply so they can charge any sale price or rental they want ?
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None of above. Just wild speculation. Henry Harrison pre-2008 crash pointed out that projects being built in his most state of CT suggested that new buildings were being constructed on inappropriate lands that were marginally suitable for the kind of construction - I believe he referenced an actual building project near him. He was right. We are seeing those pesky "greenfield" subdivisions popping up again. Builders frustrated with finding land inside a city to develop, go out of the city limits and build poorly regulated homes with septic tanks and a rural water system under strain already. We had dozens of them bankrupt and stranded in 2009 here and those are now mostly revived and completed after 15 years...so new ones built so the builder can build and build and build...and hope someone can pay and pay and pay.
 
American Homes 4 Rent has issued over $4 BILLION in various bonds over the past few years and they are not the biggest player in the market. Proceeds from the bonds went to purchase SFRs all over the country. There are other, larger REITs doing the same thing.

In this area they are a major force in the buying market. A broker buddy follows the county wide sales and said that last year they accounted for over 30% of the purchases. Full price or better, no inspections, no appraisals, cash closing in 2-3 weeks. They also approach the small investors, say Mom-Pop that has 10 -20 rental properties, and they will buy the entire portfolio.

They rent them out and the monthly rent is about $1/sq.ft./month. 1,600 sq.ft. home, $1,600 monthly rent, plus add-ons. They pay the utilities and then bill the tenant, with a bit of a premium on top for handling, of course.
 
Peter LeQuire said:
the securities secured by them - with fixed rates - will suffer significant declines in value and will sent the fault-finding securities forensic analysts hunting for a scape goat.
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That is a GREAT point. MBS are priced (in part) based on the collective rates of the individual loans in the pool. Once rates trend up, the value of those MBS will decline, as market participants can get higher returns via other vehicles...
 
"Creative destruction refers to the incessant product and process innovation mechanism by which new production units replace outdated ones. It was coined by Joseph Schumpeter (1942), who considered it ‘the essential fact about capitalism’."

Accept the "creative destruction" of the mortgage/lending/appraisal/etc. industry as a reflection of what most, if not all, long for....
Unfettered/unregulated/etc. capitalism....





Most versions of the song are melancholy....
But this one is rather upbeat....
It's our choice which we embrace....
 
Non Sequitur said:
Hyperbole or reality for AMCs?

Whether you want to complete desktops or not, AMCs have the big stick. They have captured the market, control the workflow, and will send these to willing staff and trickle overflow to indie "partners". The only chance we have to level the playing field is if the GSEs adopt the VA appraisal system.

www.clearcapital.com

1004 Desktop appraisals: A monumental step forward for appraisal modernization

Today’s announcement from Fannie Mae — the incorporation of 1004 Desktop appraisals into their Selling Guide for many new purchase loans — is a big step forward in the journey to a fully modern appraisal process.
www.clearcapital.com www.clearcapital.com
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Yes, it's a monopoly that needs to be broken up.
 
Jeffrey Hilborn said:
I don't understand why we're so up in arms over this. I don't need to inspect a home that's listed on the MLS with good photos and a floorplan sketch. It's a waste of time. Appraisal waivers are where we should focus our energy.
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I guess some people like doing just as much work, staying inside the office all day everyday for less money. :shrug:
 
residentialguy said:
I guess some people like doing just as much work, staying inside the office all day everyday for less money. :shrug:
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If I didn't have to drive to two houses + comps every day, then I would be free to take on another appraisal. Even with a reduced rate, I would make more money doing desktops all day. I'm willing to go 1 hour away for my favorite clients. It would be great if some of those distant orders could be desktops. But field inspections aren't going away completely anytime soon. And I wouldn't want them to.
 
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