HotPads Daily :: The Official Blog of HotPads.com

Homeowners Hit Hard by Rising Property Taxes

As if record foreclosures and sinking property values and were not enough, homeowners across the country are now facing higher property taxes as local governments try to cover revenue shortfalls after years of booming revenues.

Real property tax is determined by the home's assessed value and the local tax rate.  Homeowners across the country are fuming because in many cases the actual market value of their property has fallen sharply while the assessed value is still at a record high.  And faced with higher fuel and healthcare costs, local governments are raising the tax rate as well.

Homes in Memphis are facing a proposed 17% hike in the property tax rate.  For many frustrated owners, rental houses are looking better every day.

Friday, and Feelin' Fine

The earnest industry reporters at HotPads Daily have to tell it like we see it, which over the past few months has meant reporting a lot of bad news.  From falling home equity to rising foreclosures, the picture painted has not been pretty.

But today we have plethora of positive posts from all corners of the economy.  Freddie Mac is injecting $15 billion into the credit market by buying mega mortgages from Wells Fargo, JPMorgan Chase and Washington Mutual.  Shares of Google rose 17% yesterday with data on strong advertising profits, good news for all websites offering online marketing.  And investors are even flocking back to i-banks with Merrill Lynch on the rise.

So instead of our usual Friday happy hour, we're calling for an entire Happy Day.  (But still with a happy hour at the end.)

Foreclosures Jump 57% last Month

Year-over-year numbers continue to paint a bleak picture for the nation's homeowners as foreclosures rose 57% over their March 2007 numbers.  The foreclosure website RealtyTrac posted data showing Nevada, California and Florida having the highest foreclosure rates.

But while the number of homes repossessed by banks are up 129%, the number of home being put up for auction increased only 32% since March 2007.  That suggests that more people are simply walking away from their mortgages and letting the lender take possession of the home without putting it up for public foreclosure auction.

You can check out foreclosure rates nationwide and in your area on the new foreclosure heat maps on HotPads.com, as well as browse foreclosures and other homes for sale on our interactive housing search.

Dow Surges 400 Points Behind More Fed Cuts

There aren't any stern bears in this circus.

Reacting to news of a .75% cut in a key interest rate by the Federal Reserve, Wall Street partied like it was last March, sending the Dow Jones Industrial average up by over 400 points today.  Also helping were better than expected numbers from big banks Lehman Brothers and Goldman Sachs, easing the markets' concerns after the implosion of Bear Stearns and its buyout by JPMorgan.

This can also be good news for the housing market, if it helps to push mortgage rates lower and opens the credit spigot a little bit.  We'd love to think that we've gotten through the worst of the housing crisis, and even have signs of hope as we've already been seeing a sharp rise in searches for real estate for sale on HotPads.

Real Estate is Still Booming. On TV.

There are only a few places not feeling the ill effects of the numerous maladies afflicting the real estate world; The gulf state of Dubai, foreclosure auctioneers and homes for sale on HotPads come to mind.  But TV programmers are really going all-in with housing-related projects.

Reality shows centered around home buying, house flipping and home renovation are all the rage on cable and network TV.

In two days, "Flip This House" will enter its fourth season on A&E.  That's not be be confused with  "Flip That House" on TLC or Bravo's "Flipping Out."   In January, Home & Garden's HGTV had its highest prime-time ratings ever.  Nine of its top 10 series are related to the real estate market.  And Extreme "Makeover: Home Edition" is still a hit.

Remarkably, no networks have picked up the pilot for "This is HotPads", in which a group of over-caffeinated web jockeys try to radically improve the housing search market with interactive maps.  Hilarity ensues.

Should You Walk Away? Website Helps with Foreclosures.

For only $995.00 (payable in three easy installments of $332.00)  You Walk Away will help struggling borrowers get through the foreclosure process.  With their Protection Plan and Kit you can "Unshackle yourself today  from a losing investment and use our proven method to Walk Away."

The company offers protection from collection agency phone calls, weekly foreclosure progress emails, enrollment in their credit repair plan and personal consultation with one of their real estate lawyers to ensure that the lender follows the letter of the law.

The site has raised a bit of controversy, as some say it encourages deadbeat behavior, which would further weaken the housing market.  Homeowners of the edge may just want to hold on to that grand and make a call to the Hope Now Alliance first.

Home Equity at Lowest Point in Recorded History

For the first time since the Fed began tracking these data in 1945, Americans owe more on their homes than their homes are worth.  Newly released numbers have the exact figure at 47.9%, an all-time low despite the rapid gains in home values in the 1990's and earlier part of this decade.

Despite a likely recession brought about by the ongoing fall in home values (and massive housing inventory, evident by the rising number of homes for sale on HotPads) some economists are calling for an even steeper decline in home values as the best chance for a recovery.

The statistical storm clouds are lending more credence to talk of another big rate cut by the Federal Reserve when it meets later this month.

Anti-Foreclosure Group Claims One Million Saves

Treasury Secretary Henry Paulson announced in a speech Monday that the coalition of home lenders (including giants like Citigroup, Wells Fargo and Bank of America) and other organizations, known as the Hope Now Alliance, has aided over one million at-risk borrowers in reworking their mortgages to avoid foreclosure since July.

However, the merits of this program are very much the topic of debate, with some claiming that the program will not provide long-term relief and may even add thousand to the overall cost of many loans.

Of course, many homeowners feeling the pinch instead choose to sell their homes and preserve their credit, and can take advantage of the real estate marketing solutions available from HotPads.com.

If you are having trouble paying your mortgage, you can visit the Hope Now website at www.hopenow.com.

Inflation Fears on the Rise

What's a bubble without inflation?  Just liquid soap?  Chewed gum?  For the U.S. economy, we may not need to ask that question.   

With the rising cost of gas, groceries, medical bills and repeated rate cuts by the Fed, economists worried that the United States is heading for a period of major inflation.  The Consumer Price Index posted a 4.3% gain over the past 12-months and it has been climbing from a level of just 2% last August.

But before you panic and go running through downtown New York real estate like the cast of Cloverfield, know that HotPads will do our part to keep the inflation beast at bay; we're still free to search, free to list, and with no referral fees.

Homebuilders Offering Price Protection Guarantees

There is perhaps no group of professionals working harder to earn their paychecks today than the folks responsible for marketing new homes.  Homebuilders have to come up with creative incentives for buyers and even master new technologies, like listing their properties though an XML data feed to HotPads.

The Wall Street Journal is reporting that several builders are now offering a form of price protection to new home buyers; if the cost of comparable homes declines before the buyer go to settlement, the purchase price is reduced.  However, determining what "comparable" homes are and the amount of reductions can be complicated.

Not all builders will add this to their marketing arsenal, and some have tried it and stopped.  But it's a safe bet that until this market rights itself, marketing directors will continue to keep late nights looking for innovative advertising and promotional opportunities to move homes.