Of Foreclosure, Families and Furniture

20 offers out - NONE accepted 1 closing

I love being out in the field

The foreclosure crisis

A lot of times this blog comes across as very cavalier about foreclosure. It's my job and the ho-hum of scouting empty houses can become impersonal. The reality of foreclosure's impact on real people collided with routine earlier this week. We visited a house with furniture still in it. NSP regulations require that homes be vacant for 90 days prior to putting in an offer so usually the houses are empty. However, entering the first house we encountered a pile of furniture -- a bookshelf, a chair, knick knacks -- right in the entryway. Someone had tied a small wicker basket on the pull chain of the living room ceiling fan as decoration. The basket was not HGTV-ready, but it was an authentic and personal trace of the people who once lived in that 3 bedroom, 2.5 bath home on an awkward corner of a middle income subdivision just about 10 miles from my office.

The presence of furniture gave me pause. It drew my attention to the dark spot on the floor where a dresser once stood. Furniture humanizes the insane paint schemes I have seen in many bedrooms, transforming tacky walls covered in little pink hand and footprints and ceilings decorated in purple rabbits into nurseries that once held children where parents planned to raise them in safe, stable surroundings. Then the market tanked. Or the job vanished. Or the landlord went under. Or all three. All that gets left behind are walls that I am going to hire people to paint over in pleasing neutrals, carpets that I will replace because they are stained with juice, food, mud and furniture spots. I felt complicit in erasing the memory of the people who once made their homes in those places and who were caught up, as renters or as buyers, in the orgy of easy money and easier real estate that brought about a personal, national and global economic implosion.

Sometimes I feel like I'm cleaning up after a disaster: every bit left behind is a reminder of what was destroyed, yet I know that something new--and sustainable--will spring from the destruction. Those former residents have moved on and to remain viable, the neighborhood needs to ensure that vacant houses get occupied to maintain values, safety and aesthetics. So I paint over carefully-drawn designs and stickers of smiling zoo animals; I tear up heavily used carpet and torn vinyl; and I replace woodwork chewed away by the family dog, hoping that the restart I provide will create the conditions for a renewal.

No Access: 3 Dirty Tricks of Real Estate Acquisition

Ah the joys of real estate. Apparently the market is heating back up because the dirty tricks of the trade are starting to peek out of their down market hibernation.

Before the market started to turn, access to foreclosed houses was not a problem. You got the code, opened the box and sashayed on in. Sometimes, the doors were just left unlocked. Nowadays however, heifers want to keep the competition at bay. Here are the top 3 dirty tricks I've encountered:

1) Jam the only access door from the inside so that subsequent viewers can't see the property. The last person to see a house will lock the deadbolt from inside and climb out of a window to ensure that anyone coming by afterwards will not be able to get in to see the house, even if they have a key.

2) Camp out at the property and when a prospect arrives to view it the interloper proclaims (falsely) that she already has had her offer accepted and she is just waiting for the carpet guy to come by so you might as well keep on moving.

3) Take pictures of the real estate agent, potential buyer and their license plates so that you can upload them on YouTube later while claiming they are out to "destroy the neighborhood." This is not a joke; I keep my sunglasses on me for unsolicited photo sessions.

More common ploys are to remove the mailbox, obscure the house address, hide the for sale sign and toss the house key in the bushes leaving the lockbox/supra key empty. The silly thing is, in this state, only 1 of 3 foreclosure deals that go to contract actually close. Chances are that the deal the trickster is trying to shield so desperately will fall through anyway. I know it's easier to climb out of a window than to line up solid financing, but only the latter will get you title; the former will just get you dusty.

All is fair in love, war and real estate, but you know what? If you want to keep me from buying the house, just offer more. It won't be that hard.

7 tips for eliminating houses from listings

I often receive large batches of listings from the sources we use to acquire houses. There are far too many to see individually so I need to use a heavy hand to whittle down the stack to a manageable group that we can go and see. These 7 tips, particularly #5, may not be as helpful to those of you who have lots of resources to use in bidding wars and list price offers but to bargain hunters who have to keep prices very low like me, these tips have saved a lot of time.

1) Where you can see the “Days on Market” or DOM, the property should have been on the market at least 60 days. The more DOM, the better for negotiating.

2) If the house is listed over $80,000, it should have been on the market for at least 90 days (I have made some exceptions for listings over $80K that are fabulous, but I am only asking the agent to keep his eye on them to see if they go down).

3) If you are getting overwhelmed by 3 beds/2bths, start looking for larger houses and pick only very cheap 3/2s.

4) No properties with HOA fees.

5) Approach every listing with extreme disdain. Does the listing have the smell of desperation? This scent is becoming more and more faint as the market improves, but still if there is no hint of a willingness to negotiate, keep moving.

6) Size (less than 1200 sq ft and more than 2250 sq ft). The smaller properties are hard to sell; the larger properties are crazy expensive to renovate.

7) Wood siding. More times than not, it all has to be replaced and the return on the investment is low.

How Does Your Garden Grow?: With Incredible Indoor Amaryllis!

One of my best friends gave me indoor-blooming red lion amaryllis for Christmas. This is a plant I have wanted to try, but couldn't bring myself to drop the cash for it. Thank you, Santa!! Readers, this plant is awesome! It sat in a box on our front porch for a week while we were out of town for the holidays. When I got to it, it looked hale and hearty with 3 sets of foliage popping out of the top. All I had to do was take it to a sunny window, add water and wait. We started out here:


Soon we were here:


And now we are here in the land of fabulous blooms! Each stalk has 3 gigantic blossoms:


It's so perfect that it looks fake! In this landscape of snow, front and biting winds, it is so nice to watch life and color claim its space and shine.

My-my-my Poker Face

Today marks the fifth time in 30 days that I have been told that my face mirrors exactly what I am thinking or feeling. It is the second time in 30 days that I have been chastised for such expressiveness at work. I'm not going to lie to you, dear Readers, I find all of this kind of tiring. My husband tells me that a poker face is something you have to practice and hone. I mastered my brand of poker face when I was a teenager. I called it "stony face." Whenever I would be getting chewed out for some infraction, I would practice making my face look stony. The effort involved in mastering my facial expression took my attention away from what was being said, so when I looked like I wasn't paying attention it was because I wasn't paying attention. (Hi Mom! Hugs!)

So it is with me. If I look uninterested, happy, bored, tired, it's because that is how I am feeling. I don't have techniques that allow me to pay attention to an asinine conversation and not register the frustration in my face. You could say it's a good trait: I'm not a good liar. You could also say it's some Sun Tzu-inspired fatal character flaw. Whatever.

What I want to know from you is do you have any suggestions on how I can improve my poker face? In the meantime, I will leave you with a little Lady Gaga doing her poker face.

Poop

Propelled into action by the mandate to buy eleventy houses in 20 minutes, we have been hitting the streets hard looking for inventory. The county wants to concentrate on neighborhoods instead of flitting around the jurisdiction, buying houses scattered hither and yon. I have a preferred subdivision which is undergoing a lot of foreclosures, but is still pleasant, well-kept and has retained its value as much as could be expected under the circumstances. Three of us headed out last week to a house in the subdivision. On the way over, I announced to the group that unless the house had been gutted buy fire, we were going to buy it, so everyone needed to get their minds right.

The house was in worse shape that I expected. The front and back porches needed extensive work, along with the usual list of cosmetic fixes inside -- paint, fixtures, carpet, appliances. I walked from room to room snapping pictures. The electricity was off and the flash of the camera helps to illuminate dark rooms, particularly bathrooms which usually don't have the benefit of windows. I stopped in the doorway of a hall bathroom upstairs, checked it out and kept moving without taking a picture. The rest of the team, two men, stood in the bathroom door and snickered, "I'm surprised you didn't start yelling when you saw this."

"What?" I came back to the door.
"You didn't see that?" Joe pointed at a dark mass on top of the closed toilet seat.
"What?" I asked. "It's a dark rag left there by the work crew."
"Oh. OKAY." Joe grinned and walked away. "If that's what you want to believe."
"What is he talking about?" I thought and leaned in deeper in the doorway.

OH SWEET MOTHER CARRY ME HOME. It was POOP. Poop. Dried human poop. On top of the closed toilet, not inside. Why?! We're still putting an offer on the house, I'm just glad it was the last one of the day. I needed to have a glass of wine after that.

Git Her Done. NOW.

As many of my past posts have illustrated, while the local governments have been getting their NSP sea legs, we have received many hurry-up-and-wait directives. "We need you to have a gajillion houses under contract in two weeks!" shrieks the local government. I dust off the pipeline that has been sitting idle while I await directions, leap into the field and put in half a gajillion offers. I gather up all the various paperwork required to submit homes to the county for approval and continue to mine sources, negotiate counteroffers and wait for county approval. And wait. And wait. And we lose deals while we wait. It would be different if the county would respond that they've reviewed our offering and don't like the houses, but they don't respond at all. At all!! I'm supposed to cheerfully shrug off all the wasted time and effort. I know I shouldn't care since I can't move forward without the county's approval, but I know I will ultimately be judged based on my production regardless of the forces beyond my control.

Anyway, so a few days ago, my ultimate boss, the head honcho comes into my office with his face all alight and tells me gleefully that the county is ready to move forward in aggressively acquiring houses.

"Okay," I smiled beatifically at him and turned back to my computer screen.
"No, really. They are committed now."
I turned back to face him.
"And that means that we'll need to have 10 closings a month for the next 6 months."
If he hadn't been serious I would have burst into peals of laughter. Ten closings a month is a dream. Why? Well, we do desktop reviews of about 25 houses for every 5 we go to see. We see approximately 5 houses for every 3 offers. We have to put out about 3 offers for every 1 we get accepted. By the way, we also have mountains of meetings and 5 other jurisdictions where we are starting rehab and resale processes for houses that have already been purchased. Ten closings a month? Okay. We'll get right on it.

I contacted our realtor, who is awesome and extremely hard-working, and told him the news. He laughed too, but promptly sent me over 50 listings to review. I picked out 21. Twelve were available. We visited them and decided to put out 7 offers. None have been accepted or countered yet. It's a slog, but we are pushing.

The next day, the head honcho revised his goals for the county. Instead of promising 10 closings a month, he committed that we would have 60 houses under contract by the end of March. You know it's mid-January, right? Seventy-odd days to put 60 houses under contract? It's beyond laughable; it's absurd. Everyone I work with who is a practitioner knows it's absurd but no one will tell him. I'm not going to tell him either since I, apparently, am negative enough (see the next post). Still, we are going to mine every source we can thing of, put out a flurry of offers and deluge the county with requests for approvals. It's going to be an extremely chaotic, bumpy ride. I hope we're all strapped in.