"Legally Blonde" hit the theatres when I was in law school. Elle and her world were absolutely not real reflections of our own, but they were tinged with a heavy enough stain of truth to be a good parody and to remind us to lighten up a bit. The thing I found most endearing about Elle was that she mixed common sense practicality with an innate intelligence. She didn't lose herself in the weeds of philosophical purity; she got the job done with no-nonsense observations: "Happy people just don't shoot their husbands" and "the rules of hair care are simple and finite", hard work and a great pair of shoes. In my acquisition work, I am caught in a schism between opposing acquisition strategies that make me wish for some of Elle's Cosmo instincts that light the path from a wet perm to a murder conviction.
Remember when I wrote about the 2 battling acquisition strategies in our camp? There was one school of thought that wanted houses in great condition. These houses would cost a little more, but because they only required light renovations and were in desirable neighborhoods we could acquire them and heavily subsidize the purchase price for middle income families. The second school of thought wanted to leave the almost-ready homes for owner occupants to buy directly from the banks and asserted that the best use for government funds would be to buy houses that no one wanted, fix them up and return them to the market. We thought we could strike a nice balance and pick up houses that would satisfy both philosophies smorgasbord-style. That works in some areas, but not in the ones I am project managing. The market today is an entirely different animal than it was 6 months ago. In a race to cash in on the $8000 federal first time homebuyer tax credit, owner occupants have crowded back into the market. Investors smell the bottom and have come roaring back as well. The houses that are in great condition fly off the shelves like marked down Jimmy Choo slingbacks.
Thinking about all of the houses I have bid on or put offers in on only to lose makes me feel like Elle in Legally Blonde in the scene when she walks into the Harvard Halloween party underdressed as a Playboy Bunny: I'm doing all the right things in an environment that has totally changed and here I am wearing bunny ears in a shark tank. Just last week, I spent ALL DAY touring houses on Wednesday. I spent 2 hours on Friday preparing all of the prices for the 9 offers we wanted to put in. After I sent them to him, our agent told me that we had “missed our window of opportunity” for the week because we had taken too long to put in offers. Why didn't I give him the numbers on Thursday, you ask? Because on Thursday of that week I spent all afternoon touring another county with a different agent. I got her our offers on Friday too. One agent (selling a house that was so clean I could have slept in it that night) said that the Seller was awash in offers and wouldn’t accept anymore. The Seller stopped accepting offers?! What is this? 2005?! Fine. I haven’t heard back about the other houses yet, but our agent gently suggested that we increase our offers to listing price or better.
Surely higher offers would increase our success rate, but HUD’s regulations require that NSP participants pay at least 1% below appraised value. Without an appraisal, we have to rely on comparative market analyses to bid over the listing price and hope that we are still within range when an appraisal comes in. Yes, we do stipulate that if the property appraises for too little, we have the right to back out of the transaction but that makes our offer less palatable as well.
More importantly, if we are losing houses to owner-occupants who just got the deal of their lives, then so be it. I tried to be neutral about where I stood in the first post about this dilemma, but I think it's fair to say now that I am firmly aligned with the buy-busted-houses camp. We have never considered ourselves in competition with owner-occupants who don't mind giving a home a little TLC. However, my fear is that investors might be re-entering the market to buy and hold until the prices rebound. If they do that, the houses will remain vacant or may be rented to people who are not interested in being a stabilizing influence in the neighborhood. Not all investors are speculators with little regard for neighborhood health. Still, some of hardest hit neighborhoods have suffered deeply at the hands of unscrupulous investors and mortgage fraud schemes during boom and bust years (click here for an informative video on how mortgage fraud has destroyed communities in Atlanta, Georgia's West End neighborhood). However, the tightening of the market makes it increasingly more difficult for non-profits to meet the tight timelines imposed by HUD for the use of NSP funds. If you don't use it, you lose it and local governments are rightly exorcised at the possibility of losing federal funds that their neighborhoods desperately need.
No one has written the Legally Blonde version of low to middle-income housing rehab yet. The heroine will wear Puma, not pumps and I suspect she'll know her way around a wet saw (I'm talking to you, Paula and Angela). She'll be able to sweet talk ornery agents, quote mortgage payments off the top of her head, rattle off obscure HUD regulations and secure easy funding from commercial lenders with high loan-to-value ratios. Her love interest will be a struggling British primary mortgage lender with a heart of gold played by Colin Firth.
With the small screen being deluged in reality rehab and design divas, Hollywood has got to give us a development doyenne who is fictional enough to be funny but real enough to inspire. The story could revolve around the protagonist becoming proficient in buying and rehabbing houses in a subdivision where all the streets area named after birds. Her love interest will be a primary mortgage banker with a heart of gold played by Colin Firth. It'll be called "Flippin' Birds" (get it? get it? ha!). All right, Hollywood, start writing. As I wait for the premiere, I'll be stacking up homes that not even the "we buy ugly houses" people want. Sigh. Comic relief, please!
Surely higher offers would increase our success rate, but HUD’s regulations require that NSP participants pay at least 1% below appraised value. Without an appraisal, we have to rely on comparative market analyses to bid over the listing price and hope that we are still within range when an appraisal comes in. Yes, we do stipulate that if the property appraises for too little, we have the right to back out of the transaction but that makes our offer less palatable as well.
More importantly, if we are losing houses to owner-occupants who just got the deal of their lives, then so be it. I tried to be neutral about where I stood in the first post about this dilemma, but I think it's fair to say now that I am firmly aligned with the buy-busted-houses camp. We have never considered ourselves in competition with owner-occupants who don't mind giving a home a little TLC. However, my fear is that investors might be re-entering the market to buy and hold until the prices rebound. If they do that, the houses will remain vacant or may be rented to people who are not interested in being a stabilizing influence in the neighborhood. Not all investors are speculators with little regard for neighborhood health. Still, some of hardest hit neighborhoods have suffered deeply at the hands of unscrupulous investors and mortgage fraud schemes during boom and bust years (click here for an informative video on how mortgage fraud has destroyed communities in Atlanta, Georgia's West End neighborhood). However, the tightening of the market makes it increasingly more difficult for non-profits to meet the tight timelines imposed by HUD for the use of NSP funds. If you don't use it, you lose it and local governments are rightly exorcised at the possibility of losing federal funds that their neighborhoods desperately need.
No one has written the Legally Blonde version of low to middle-income housing rehab yet. The heroine will wear Puma, not pumps and I suspect she'll know her way around a wet saw (I'm talking to you, Paula and Angela). She'll be able to sweet talk ornery agents, quote mortgage payments off the top of her head, rattle off obscure HUD regulations and secure easy funding from commercial lenders with high loan-to-value ratios. Her love interest will be a struggling British primary mortgage lender with a heart of gold played by Colin Firth.
With the small screen being deluged in reality rehab and design divas, Hollywood has got to give us a development doyenne who is fictional enough to be funny but real enough to inspire. The story could revolve around the protagonist becoming proficient in buying and rehabbing houses in a subdivision where all the streets area named after birds. Her love interest will be a primary mortgage banker with a heart of gold played by Colin Firth. It'll be called "Flippin' Birds" (get it? get it? ha!). All right, Hollywood, start writing. As I wait for the premiere, I'll be stacking up homes that not even the "we buy ugly houses" people want. Sigh. Comic relief, please!
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