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Jennifer St.Clair

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Bye-Bye Fannie, Freddie? What It Could Mean
The Obama administration announced on Friday plans to reform the housing finance market, including winding down government-controlled mortgage giants Fannie Mae and Freddie Mac and turning most of the market over to the private sector, as well as requiring larger down payments. The White House proposed three approaches to replacing Fannie Mae and Freddie Mac rather than offering up one final plan.

San Diego County Foreclosure Outcomes

This chart covers the past year's data for San Diego County foreclosure filings and the ultimate result or outcome of the filing.   The yellow line or 'sold to third party' represents those homes sold on the courthouse steps, usually to investors, while the red line represents those foreclosed homes that the bank now holds on their balance sheet and ultimately will be listed with a local Real Estate agent as an REO. This is where the so called 'shadow inventory' hides.  After the bank repos the home but before they put it on the market as a distressed sale.

 As you can see their has been a 23% decrease in the foreclosed homes sold to third parties from the prior year but up from December 2010 and Nov 200.   The result being less 'fix and flips' on the market.

 The gray line shows the foreclosures that were canceled for various reasons.

Baby can you spare a 3% commission?

In the San Diego Real Esate market we are faced with multiple offer situtations with all our our buyers in the below 500K price range unless there i something really wrong with the home. This creates a dynamic where agents and buyers are frantically rushing from one new listing to another as soon as they pop up writing offers on anything that closely resembles their requirements even sight unseen.

This also has created a dynamic where listing agents and their clients, due to the demand, have decided that they are cutting their commissions so it is not uncommon to see 2% to 2.5% CBB.  At the higher price points this is not as challanging but when you have a 100% VA 1st time home buyer that fell in love with a $200K home paying 2% CBB after you have taken them to view 70 homes and written offers on 10 properties this quickly becomes a huge issue! We buyer’s agents ought to be paid more in this crazy market! At the very least we ought to be earning the standard commission!

Through my networking I have access to investors with pre-MLS listings that only pay 2%CBB and I require my buyers to bring 1/2% if they want to shop these homes.  This is a solution that has been accepted by every buyer and, though it still isn’t 3%, it is only a 16% redution in CM instead of a 33%.  I have one investor client who pays only 3.5% total CM because he can!  That’s 1-1.5% to listing agent and 2-2.5% to the selling agent.  I’ve never been one in all my 25 years of sales to cut my commissions, yet in this crazy marketplace who

Personally, I have focused as much time and energy into developing relationships with asset managers, top agenicies and investors as I do prospecting because it doesn’t help to have 20 qualified buyers if there is no home to sell them. This has been a successfull strategy with my last wo buyers getting their first offer accepted.

San Diego may not be a unique marketplace right now but we sure have to get creative to service out clients needs these days.  It’s about adaptation and change, creativity and perseverance.  Baby can you spare a 3% commission?