House is a fixer. Needs TLC and updating. Bring your hammer and make this your home. Investors – fix up and flip or hold as a great rental. Not much under 300K in this area!

1977 one story ranch
1040 sqft
3 bedrooms
1.5 baths
4500 sqft lot

Needs floors throughout, kitchen and baths need updating, paint inside and out.

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October’s statistics show similar patterns to September, as the number of transactions continue to drop and sale prices continue to see appreciation. The number of closed sales fell 25.5% and pending sales declined 22% However, the number of new listings dropped for the first time since February of 2006, decreasing 5.1% this month when comparing October of this year with October 2006. At the month’s rate of sales, the 15,567 active residential properties would last approximately 8.4 months.

Appreciation

Using the average sale prices for the twelve months that ended with October 2007 compared to the twelve months ending in October 2006, the average sale price appreciated 6.7% ($339,300 v. $318,100). Using the same formula, the median sale price also appreciated 7.3% ($287,500 v. $267,900).

Year-to-Date Trends

When comparing the period of January 2007 through October 2007 to the same time a year ago, pending sales have decreased 13.9% and closed sales declined 11.3%. New listings, on the other hand, are up 8.8%.

By the organization’s own definition, HUD is the Federal agency responsible for national policy and programs that address America’s housing needs, improve and develop the nation’s communities, and enforce fair housing laws.

HUD also underwrites homeownership for lower- and moderate-income families through its mortgage insurance program – the Federal Housing Administration (FHA.) A primary function of the FHA is to provide the mortgage insurance that will encourage lenders to make financing available and affordable for housing purchases. When a homeowner with an FHA loan defaults on a mortage, the home reverts back to the lender who then looks to the FHA to pay off the remainder of the mortgage. The home then ends up in HUD inventory, as part of HUD Homes, a program designed to market the homes through real estate agents and to find buyers.

Homes that have been reposssessed can pose a stigma in any neighborhood. It is in the local economy’s best interest for the home to be reabsorbed and occupied as quickly as possible.

Having licensed professional agents market and assist buyers for the homes makes this process easier. And the buyers are in a position to get a bargain – most of the homes are marketed only at the rate of their defaulted loans, making them many times below comparable market value.

The down side is that when a homeowner is forced to lose a home in such a way, neglect and damage may be found in the home. Sometimes, HUD will provide special assistance in the form of repair allowances or low down payments to assure that the home is quickly occupied.
HUD Homes require no special commitments to buy. They may be purchased by any qualified buyers, without regard to the buyer’s race, color, religion, sex, or national origin.

With a HUD Home, there is the advantage that you do not have to deal with the occupant of the home. In some areas, a HUD office may accept a counter-offer from you, but if your counter-offer is not accepted, the home goes back on the market. HUD is interested in a quick sale, so the organization is geared to respond quickly to your offer. If you make an offere that is accepted, the home can close in as little as 30 to 60 days.

Again, you must work with a HUD broker. A HUD broker is any licensed REALTOR who is on file with the organization. Some brokers advertise their desire to sell HUD Homes. Finding one shouldn’t be difficult. You can call the HUD office for a recommendation. Since the broker’s commission is being paid by HUD, the broker’s help to you is free.
Some helpful sites to visit:

Housing Counseling Agencies – Government-approved consumer credit organizations

Home Buying Tips – Includes settlement costs and helpful information including a description of a real estate agent, selecting an attorney, securing a loan, and more.

If you are in a neighborhood that has an HOA, they typically have a list of acceptable color palates available to you. Otherwise, you will need to take your color choice to the HOA and have them approve the color. The goal is to keep the neighborhood consistent and clean.

If you don’t have an HOA that governs the area, you will just have to use your best judgment. Drive around your neighborhood and look at the different houses. Decide on which colors you like. Once you find a few that you like, head on over to your local paint store and grab a few swatches. It’s important to remember that a color can look truly different in the sun than it does when it’s cloudy outside. Portland has many cloudy days so sticking with a northwest color palette is a safe move.

Just remember that color makes a first impression and can enhance curb appeal and even resale value. You can highlight your home’s architectural detail by selecting a great contrasting or accent color for the trim, shutters and front door/entryway. Keep in mind that some colors can not be changed like the roof so do your best to select a color that compliments your roofs color. Also, your color should neither match nor clash with your neighbor’s homes.

Many paint stores offer computer imaging so you can get an idea of how your house would look using the colors you like. There are also some fabulous online tools available to you that can help you select the colors for your home. Benjaminmoore.com and Sherwin-Williams.com are just a couple of great online resources.

A fresh coat of paint can add new life to your home and really enhance your home’s value and curb appeal. Just make sure to take your time and don’t rush to a decision. It’s an expensive mistake to fix!! But most of all have fun!! 

Some expenses you may not think of but you’ll need to account for are:  hidden maintenace costs (like a new roof in a couple years, or the water main breaks); tenants who are behind on payment when you buy an occupied property; HOA fees (the numbers look great until you account for the $125/mo fee; utilities - if you are responsible for them.

These are just a few things to think about when purchasing income property. Remember, the key is to have a investment property that makes you money and not an investment property that you have to feed each month.

If you are looking for a real estate investment property or fixer in Portland give me a call or send me an email.  I can provide you with the latest listings for Portland real estate investment properties.

Never underestimate the advantages of buying a fixer property in a great location.  The key to a great deal is finding the least expensive, most run-down house on a street of well cared for homes in a nice desirable neighborhood.  There are many pockets of neighborhoods around town that feature homes like this including Cedar Mill, Cedar Hills, Rock Creek, West Haven, and Burlingame on the west side of Portland.

Drive around these neighborhoods and get a feel for them.  Then start your search looking for lower priced homes on nice streets that are within walking distance of parks, schools, shops, and restaurants.

If you get a great deal on a fixer in a nice neighbohood, but it backs up to an apartment complex or a busy street, you’re not going to get nearly as much return as on a quiet street a couple blocks over.

“There is an affordable housing crisis in America.  In recent months, that crisis has exploded beyond the poorest renters and homeowners, to threaten the domestic economy.  H.R. 1852 is a necessary step in walking us back from the brink and in the direction of meeting the housing needs of all Americans,” said Chairwoman Waters.

            “A revitalized FHA program will help future homeowners realize the dream of home ownership, and will prevent many first time and inexperienced home buyers from being pushed into loans that are unaffordable or difficult to understand,” said Chairman Frank.  “The bill we passed today will help people all across America because we have enacted provisions to allow the FHA to insure loans in high cost areas.”

Specifically, the bill includes the following important provisions:

• Lower Down Payments.  Authorizes zero and lower down payment loans for borrowers that can afford mortgage payments, but lack the cash for a required down payment.
• Housing Counseling.  Authorizes more than double the current funding level for housing counseling, to help subprime homebuyers and borrowers late on mortgage loan payments.
• Subprime borrowers.  Directs FHA to provide mortgage loans to higher risk (but qualified) borrowers, without authorizing unnecessary fee hikes on such borrowers.
  Reverse Mortgages.  Enhances the FHA reverse mortgage loan program to help seniors pay for health and other expenses, by removing the loan cap to avoid program shutdowns, raising loan limits, and by reducing the maximum fee lenders can charge for these loans.
• Multifamily Loans. Raises FHA multifamily loan limits, so these loans can fully fund construction costs in high cost areas, and enhances sale of foreclosed FHA rental housing loans to localities, so that affordable housing can be maintained in local communities.
• Affordable Housing Fund.  Authorizes up to $300 million a year from the bill’s excess profits for affordable housing, instead of returning such funds to the General Treasury.
• Higher Loan Limits.  Adopts the Frank/Miller/Cardoza amendment that would raise FHA single family loan limits, which now bar loans above 95% of the median home price in each local area and shut FHA out of higher cost home markets.  The amendment raises the FHA loan limit in each area to the lower of (a) 125% of the local area median home price or (b) 175% of the national GSE conforming loan limit.  The amendment also retains the bill’s provision for a nationwide FHA loan floor of 65% of the GSE conforming loan limit, and gives HUD authority to raise these loan limit amounts by up to $100,000 “if market conditions warrant.”

In addition, the House adopted an amendment to the bill to direct FHA to make available refinancing loans to existing qualified homeowners who are in default or at risk of default due to rate resets or mortgage market conditions, and to authorize lower down payments for such purpose.  The amendment also includes provisions to address problems arising from inflated appraisals.

The market continues to follow the trends of recent months. While new listings continue to grow, the numbers of transactions are down. However, average home prices continue to rise at a steady rate.

The number of new listings in August grew 9.1% compared to August of 2006. On the other hand, pending sales dropped 18.1% and closed sales fell 13.1%.

At the end of August 2007, there were 15,782 active residential listings in the Portland Metro area. Given the month’s rate of sales they would last 6.2 months.

Year-To-Date Trends.

When comparing the period of January 2007-August 2007 to the same period in 2006, new listings have grown 11.8%. Pending sales fell 11.7% and closed sales decreased 8.1%.

Appreciation.

Using the average and median sale prices for the twelve months that ended with August 2007 compared to the twelve months ending in August 2006, the average sale price appreciated 7.8% ($337,400 v. $313,000). Using the same formula, the median sale price appreciated 8.1% ($285,000 v. $263,700).

Finishing a basement makes a great spot for a media room, family room, office or play room for the kids.  Converting an attic to a bedroom will give you the biggest bang for your buck.  Many older houses in SE Portland and NE Portland have enough headroom in the attic to add a couple bedrooms and a bathroom.

Make sure you use a licensed and bonded contractor when converting an attic space or finishing a basement.  Proper permits are required for this type of work and will help with the resale of your fixer.

Contact me if you need a referral for a contractor to help with your basement or attic conversion.