Bay Shore Open House
877 Manor Lane, Bay Shore, NY 11706
June 30, 2013 from 1-3PM
From The Detroit News: https://www.detroitnews.com/article/20130105/METRO01/301050343#ixzz2I4JD3VyN
Detroit — Kristine Diven thought she had her dream house.
For $500 at a tax auction in October, she and fellow artist Micho “Detronik” McAdow bought an empty two-story home on Detroit’s east side. Thrilled with its crown molding, hardwood floors and fireplace mantels adorned with Pewabic tile, the pair planned to fix it up and move in by spring.
As a first step, Diven, 36, prepared to board up the Morningside neighborhood house to protect it against vandals and wintertime damage. But when she and McAdow drove down Beaconsfield Street one evening in December, their new house was gone.
“Instead of taking measurements for the boards we needed, we found our house in a pile,” she said.
The structure had been demolished — mistakenly — by the state’s Land Bank Fast Track Authority as part of a program to eliminate blight near three east-side schools.
At least 11 other properties, purchased by a local investor, also were demolished by mistake, said Karla Henderson, director of the city’s planning and facilities department.
“When we drove up, I thought what I was seeing couldn’t be right,” Diven said. “In the past (few) weeks, it’s almost like being in mourning.”
Mistakes like this are rare, city and state officials said.
It turned out that Diven’s home and the others had been slated for demolition before being sold at auction, said Kurt Weiss, a state government spokesman.
The city ordered the house on Beaconsfield demolished in June 2011. The Fire Department identified the building as vacant and dangerous last summer. It was added to a final demolition list July 30.
At the same time, the house went up for auction by the Wayne County Treasurer’s Office over the summer. When it didn’t sell then, it was placed on sale again by the county in October, a last-ditch effort for the treasurer to get rid of the property, city officials said.
The home was demolished a day before the deed was recorded to the official buyer — Chris Xiromeritis — a friend of Diven’s who had worked with her and McAdow to try to bid on multiple properties, according to Weiss and county records.
The other 11 properties identified as being improperly razed were purchased by Sameer Beydoun, a Dearborn real estate agent.
Beydoun declined to comment, but a spokeswoman for his company, Dearborn-based Metro Property Group, said Beydoun bought the properties with the intent of rehabbing them to help restore Detroit neighborhoods.
“MPG is working with the state and county to resolve this matter, in terms of reimbursement,” Darci McConnell, the spokeswoman, said in a written statement.
Although the city was not responsible for the mistake, Henderson gave Diven a list of empty, city-owned properties with an offer that she could take one.
But Diven said those properties are nothing like the jewel on Beaconsfield. The structure, originally built as a two-family flat, was converted into a single family residence with five bedrooms.
The property was adjacent to Grosse Pointe, potentially helping its value, she said. A family lived across the street. An empty lot next door would have made the perfect community garden, she added.
The home had a new roof and repairs seemed like they would be manageable. Diven and McAdow figured they would spend perhaps $8,000 on drywall, new bathtubs and window frame repairs to make the home livable.
Weiss said the Wayne County Treasurer’s Office refunded Diven the $500 paid for the house.
“It was regrettable that it was inadvertently torn down,” Weiss said. “This has been a very successful program, but obviously in this instance it didn’t happen the way it was supposed to.”
Weiss said the state is still committed to tearing down blighted structures near schools and is confident that similar errors will be avoided.
The mistaken demolitions occurred in the midst of a campaign by state and city officials to tear down tens of thousands of rotting, abandoned Detroit homes.
In July, Gov. Rick Snyder launched a pilot project among the city, state and Wayne County to use $10 million to demolish about 1,200 abandoned buildings surrounding schools in three Detroit neighborhoods, including Morningside.
The “Pathways to Potential” project also is to include fixing houses, cutting crime and sending social workers to Detroit Public School campuses. The Detroit City Council approved the deal in mid-October.
Diven and McAdow’s home was in a neighborhood targeted by the program.
Some 19,600 properties with unpaid property taxes went up for auction with opening bids as low as $500. Of those, 12,327 were sold.
In the months preceding the Oct. 24 purchase, Diven spent much of her free time navigating the scores of Detroit properties on the auction list.
Often when she found an address, the property was little more than a burnt-out building. “You’re going in blind and taking some deal of risk, but you hope that you get through the process relatively unscathed,” said Diven, who lives in the Rivertown area.
Friends of Diven, a New Yorker who moved to Detroit about four years ago, warned her not to get too excited about the home.
Owners of similar properties purchased in the auction said they’ve been the victims of theft, arson, even illegal squatting. The cost of renovation, they added, can sometimes be steep, too.
But Diven said she and McAdow, who works in interactive media, “felt we had a diamond in the rough. We were surprised by how no one noticed the condition it was in, it was almost ready to move into.”
Diven and McAdow said they aren’t considering legal action but want officials to make amends for their mistake. A house of similar quality would help, considering all the labor they put into finding the Morningside home, she said.
“We’ve had a lot of email and phone conversations from seemingly friendly, polite and apologetic people,” Diven said. “But I’m afraid that as time goes by… promises will be broken and that this is going to be swept under the rug.”
From The Detroit News: https://www.detroitnews.com/article/20130105/METRO01/301050343#ixzz2I4J1hKml
Source: “Demolition of Dreams: 12 Detroit Homes Razed by Mistake,” The Detroit News and “12 Detroit Houses Demolished Accidentally, Including Couple’s Newly Bought Home,” AOL Real Estate
Well we averted a catastrophic event with Congress allowing for an extension of the 2007 Mortgage Forgiveness Debt Relief Act to January 1, 2014. Had this law NOT been extended, anyone forgiven debt from the “short sale” of their principal residence, from agreeing to a “deed in lieu of foreclosure,” or having their property foreclosed, would have had to pay federal income tax on the forgiven amount. Thankfully, that isn’t going to happen thanks to some NOT so swift action by Congress.
The New Law reads as follows:
SEC. 202. EXTENSION OF EXCLUSION FROM GROSS INCOME OF DISCHARGE OF QUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS.
(a) IN GENERAL.—Subparagraph (E) of section 108(a)(1) is amended by striking ‘‘January 1, 2013’’ and
inserting ‘‘January 1, 2014’’.
The entire ‘‘American Taxpayer Relief Act of 2012’’
Download the entire ‘‘American Taxpayer Relief Act of 2012’’
This is exactly what I was talking about back in late February, as you can see in the video I produced illustrating how foreclosures in New York would be a drag on housing prices: https://youtu.be/-3L9Rdu9Eqw
The following link to an article posted on Steve Harney’s Blog, “Keeping Current Matters” is probably the best explanation, thus far, on what the new QE3 Stimulus will mean to Housing. I hope you enjoy it
UPDATE: Some of our readers wanted a clear definition of what QE3 actually is. The best explanation we have seen can be read here. The article was posted prior to the decision to move forward by Mr. Bernanke .
Fed Chairman Ben Bernanke announced last week that the Fed would again be pumping money into mortgage-backed-securities as a way to stimulate the economy. The big question for us becomes what impact this will have on the housing market. There is absolutely no doubt that Bernanke had the housing industry in mind while making this decision. In his post meeting news conference Bernanke explained:
“I think that house prices are beginning to rise in some markets, which will encourage people to look at homes, will encourage lenders to make more mortgage loans. I am hoping we will continue to see progress in the housing market. That is one of the missing pistons in the engine here, housing is usually a big part of a recovery process. We haven’t had that nearly to the usual extent. And to the extent that we can support housing I think that would be a very useful outcome.”
How does keeping rates low help the market?
HSH Associates which reports on trends in the mortgage rate environment explains:
“Of all the Fed policies, driving down mortgage rates has arguably been the most successful. Low rates have fostered refinancing, putting money in homeowner pockets and helping to spur consumer spending. Those low rates have enhanced housing affordability, while the steadying aspect of the Fed’s presence in the market has allowed for more of those transactions to complete; in turn, this has helped to firm up home prices. The Fed is trying to cause at least some inflation, namely in asset prices — homes, stocks.”
But what impact will it actually have on home sales?
Keeping interest rates low will definitely help. However, we are not sure it will be a driving force in a housing recovery. Rates are already at historic lows and the challenge to many buyers is availability of mortgage money more than it is the cost of that money (rate). HSH Associates believes:
“Looking across the potential audiences who want to buy homes, can a claim be made that interest rates are an impediment? More likely, credit ruined in the downturn, a lack of income, unemployment or even asset strength are keeping people out of the market. In addition, there is arguably a cohort which cannot participate due to a foreclosure, short-sale or deed-in-lieu effected over the last few years, and there is likely still another group who will not buy a home at all, having watched family and friends suffer mightily with real estate issues and losses in the downturn. In this way, lower interest rates aren’t much of an inducement for a lot of folks, and except at the margins, the change merely enhances the opportunity for people already well-positioned and motivated to buy a home.”
Richard Green, director of the University of Southern California Lusk Center for Real Estate, echoed this sentiment in a recent MarketWatch article:
“While QE3 certainly won’t hurt the housing market, its short-term effect will likely be limited. The constraint that is keeping people out of the housing market is absence of equity. The drop in house prices means that many borrowers are underwater on their houses, and high unemployment has prevented potential first-time buyers from accumulating down payments.”
Keeping rates low can’t hurt the market and perhaps it will encourage some move-up buyers to make the move now. But few believe it will spur a dramatic increase in home sales.
Ben Bernanke has made it official: QE3 Stimulus has now begun! The FED will begin pumping $40B into the economy each month, as long as necessary by buying Mortgage Backed Securities. And the FED begins buying Friday and expect to buy around $27B for the remainder of the month.
But wait a minute! Hasn’t Fannie and Freddy, 2 Government agencies been buying up most MBS’s from the banks over the past few years? And if the FED will now be buying MBS’s, doesn’t that put them in direct competition with both Fannie and Freddy? And what good does it do to have these MBS’s bought by the FED if Fannie and Freddie were buying most of them anyway? And to boot, how can the fed buy so much when the banks are not lending enough to warrant such buy backs? I’m confused!
Representative Paul Ryan, for one, doesn’t think this plan will work. “Ryan said QE3 might help banks on Wall Street but will do little to help middle-class families.” I tend to agree. I’ve seen the stock market rally as everyone said it would, seen oil and gas prices spike and have noticed food prices are already inching up.
As the dust settles on this issue, I will write again trying to shed more light on this newly released government program.