While economists say a healthy housing market should be seeing around 6 million sales a year, the data is an improvement over the sales of the past few years, putting 2011 home sales on track to be 2010 sales.

U.S. Census Bureau: New Home Construction Increases

The  U.S. Census Bureau is reporting November housing starts (beginning of construction of a new home) are also showing improvement with a 2.3% increase to 447,000 starts, a 2.3% increase over the revised October figure of 437,000. This means that there have been 3 consecutive months of improvement in housing starts.

After months of negative data being released, this data is one more signal that housing may very likely be ready for a turn around in 2012.

Home Builders Confidence Increases

The National Association of Home Builders (NAHB) is reporting that builder confidence in the market for newly built, single-family homes has increased by two points from  on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for December.  today. This increase marks the third consecutive month of builder confidence improvement.

 NAHB Chief Economist David Crowe:

“This is the first time that builder confidence has improved for three consecutive months since mid-2009, which signifies a legitimate though slowly emerging upward trend,” said NAHB Chief Economist David Crowe. “While large inventories of foreclosed properties continue to plague the most distressed markets and consumer worries about job security and the challenges of selling an existing home remain significant factors, builders are reporting more inquiries and more interest among potential buyers than they have seen in previous months.”

Pre-Qualification: The First Step in Shopping For a New Home

The first step in shopping for a new home is getting pre-qualified so that you know how much home you can afford. We can help you get pre-qualified and help answer any questions you might have about what type of loan will best fit your needs and whether or not a rate lock makes sense for your situation. If you have questions, we can help with a no cost consultation where we put together a mortgage strategy that makes the most sense for your unique needs.

Related posts:

1. Mortgage Outlook for Week of July 25, 2011
2. Mortgage Outlook For the Week of December 19, 2011
3. Mortgage Update for October 20th, 2011

The Fed released the latest Beige Book data on Wednesday, painting a mixed economic picture, showing slow growth with an economy activity that expanded slightly in September. More importantly, the data suggested the US has not slipped back into a recession as some have feared.

NAR Data Shows Decrease in Home Sales

The National Association of Realtors released data today showing that home sales dropped 3 percent last month to a seasonally adjusted annual rate of 4.91 million homes. Economists say that keeping this number below 6 million is consistent with a healthy housing market. The data also showed that first-time buyers accounted for 32 percent of all sales and that homes at risk of foreclosure decreased to 30 percent of sales, from 31 percent in August.

Lead Economic Indicators Released

The Conference Board posted September’s Leading Economic Indicators (LEI) data this morning. The LEI rose 0.2%, which is a prediction of modest economic growth over the next several months. The market was expecting to see a 0.3% increase, so this release gave us weaker than forecast results.

Mortgage Rate Lock Update

The past few weeks have been a mix of volatility with an upward trend off of the all time lows reached just a few weeks ago. While rates have stabilized over the past day or so, we are still at near record lows. Since rates have much more potential upside then downside, now may be a great time to lock in your rate if you are on the sidelines. Not sure what loan is right for you or whether or not you should lock? We can help with a free consultation, so that you know with certainty what options you have and what makes the most sense for your goals and current financial situation.

That’s right, their datacenter caught fire and they still smoked Realtor.com, pun intended. There is only one right way to handle such a situation: quickly, honestly and transparently. If Redfin gets this, why can’t Realtor.com?

Chris Neitzert Sorts Through Charred Rubble of Redfin Datacenter

There was a fire in the Seattle-based data center that Redfin uses to host our web servers, causing a loss of service between approximately 5 a.m. and 10 a.m. Pacific Time. The entire data center was shut down by the fire department, including universal power supplies. Thanks to Redfin’s Chris Neitzert and his team, the site is now up and running. Throughout the interruption, our agents have of course stayed at their posts working with clients. But as the data center installs new equipment, it is possible that we will experience much-briefer interruptions in our website service around midnight tonight. We will continue to be available by telephone at 877-973-3346 or through the direct number our clients have for their agents.
For now, we apologize for the interruption in our service.

Aftermath of Realtor.com Blog Hack

Related posts:

1. Realtor.com Blog Hacked Day 3: Down for 17 Hours and Counting
2. Realtor.com Hacked Day 8: It’s Not Going Away
3. Realtor.com Hacked Day 4: No Announcement, Users Wait in Silence

You can find the National Association of Realtors at Realtor.org.

If you are interested in Real Estate and Mortgage news, you’re in the right place, take a look around!

Related posts:

1. Richard Gaylord, NAR President Comments on HVCC, Says Nothing
2. BrokerScience is Looking For Title, Escrow & Appraisal Bloggers
3. Mortgage Update for October 20th, 2011

A good starting point would be to review Loic Le Meur’s 10 Rules for Success. While the list is geared for startups, many of the ideas work just as well for established businesses.

1. Don’t wait for a revolutionary idea. It will never happen. Just focus on a simple, exciting, empty space and execute as fast as possible
2. Share your idea. The more you share, the more you get advice and the more you learn. Meet and talk to your competitors.
3. Build a community. Use blogging and social software to make sure people hear about you.
4. Listen to your community. Answer questions and build your product with their feedback.
5. Gather a great team. Select those with very different skills from you. Look for people who are better than you.
6. Be the first to recognise a problem. Everyone makes mistakes. Address the issue in public, learn about and correct it.
7. Don’t spend time on market research. Launch test versions as early as possible. Keep improving the product in the open.
8. Don’t obsess over spreadsheet business plans. They are not going to turn out as you predict, in any case.
9. Don’t plan a big marketing effort. It’s much more important and powerful that your community loves the product.
10. Don’t focus on getting rich. Focus on your users. Money is a consequence of success, not a goal.

(via Financial Times)

Previous Coverage: It all started here.

Another stunning story comes from 4Realz.net with news that weeks ago, following in Zillow’s footsteps, Realtor.com launched a new home estimates feature. Again, nobody noticed and nobody cared. Perhaps this is why Realtor.com thinks they can behave in the manner they have and  get away with it. The fact is that if nobody notices what you do or don’t do and you are a company with the reach and funding of Realtor.com / NAR, that should be a warning that you are not doing things right, not something to be used as a shield to hide behind.

Related posts:

1. Realtor.com Blog Hacked Day 3: Down for 17 Hours and Counting
2. Realtor.com Blog Hacked Day 2: Google Delisting on the Horizon
3. Realtor.com Hacked Day 8: It’s Not Going Away

In an unfortunate turn of events, Realtor.com has failed to acknowledge its website and or servers were breached and has failed to inform users whether or not personal data was compromised. This is disturbing on a number of levels. While the breach may have been as simple as a flawed wordpress plugin or much worse, nobody can know for sure due to Realtor.com’s failure to communicate.

Realtor.com Failure to Communicate Fallout:

• It signals to users that they are not valued and builds distrust and disloyalty in users.
• Fails to inform users if their data was compromised, on a legal basis, my guess is that users have a right to be informed as such.
• Is counterproductive to fostering community.
• Shows lack of leadership on the part of Realtor.com team members.
• Gives credence to criticism that Realtor.com does not act in members’ best interests.

Common Courtesy. After repeatedly informing Realtor.com that their website had been compromised, they failed to acknowledge our requests and failed to give us any feedback on the situation at hand. Oddly enough, despite their lack of communication with BrokerScience and Realtor.com users, their IP Address, 209.74.96.62, shows up as one of the most frequent visitors in BrokerScience traffic logs.

To be more specific, the IP Address of HomeStore.com shows up. It is not clear whether HomeStore is now considered a parent or partner of Realtor.com or whether it only shows up because the ARIN record has not been updated since 2001. It does, however, serve as a reminder of Realtor.com’s past and may provide a clue to the company culture that exists that would allow such a basic, preventable and unheard of gaffe to occur.

BrokerScience IP Address Traffic Log

NetRange:   209.74.96.0 - 209.74.127.255

OrgName:    Homestore.com, Inc
OrgID:      HOMEST-7
Address:    30700 Russell Ranch Rd
City:       Westlake Village
StateProv:  CA
PostalCode: 91362
Country:    US

At around 7 PM last night the Realtor.com Blog was taken offline. 17 hours later and counting, they are still down. The speculation is that a wordpress plugin was at fault, but that remains to be seen.

We are still scratching our heads over how nobody at Realtor.com noticed the hack in their RSS readers, why no action was taken when we notified them of the hack for over 36 hours and why securing the website and servers is taking 17 hours and counting.

Realtor.com is not a mom and pop shop, they take in millions from hard working Realtors and should be held to a higher standard. Have you ever seen Trulia, Zillow, Redfin or HomeGain down for 17 hours? Of course not.

Realtor.com has yet to release comment or respond to our request for comment.

Update: As of 2:30 PM, the site is back up minus the specific posts that had injected spam for a total downtime of around 19 hours. Wow. Still waiting for an official response from a Realtor.com spokesperson. My hope is that they do not fail to address the issue and communicate with the Realtor.com community and bloggers that use their service. Failure to make users aware of the circumstances involved with the hack (considering its anyone’s guess whether personal data was compromised) would be unfortunate for the Realtor.com blogging community.

Since the Realtor.com blog is actually located on a sub-domain at talk.realtor.com, my suspicion is that this could also lead to adverse effects or de-listing by Google of the primary domain of Realtor.com. I pinged Aaron Wall of SEOBook.com and Rand Fishkin of SEOMOZ.org and they concurred that issues with the sub-domain could indirectly affect the primary domain of Realtor.com

I also just noticed they DO have a contact page link if you look hard enough that I didn’t see yesterday before I emailed one of their bloggers yesterday…. let’s see if a quick email changes the situation.

The Real Question. Am I the ONLY person that gets the Realtor.com Blog FEED? Does not one employee of the NAR / Realtor.com team read their own blog / feed? I’m just saying…….

Sample of Spam Links Injected into Code (Click image below for full view)

Follow Up: Realtor.com Hacked Day 3

(Click on image for full length image)

Original post:

Related posts:

1. Realtor.com Blog Hacked Day 2: Google Delisting on the Horizon
2. Realtor.com Blog Hacked Day 3: Down for 17 Hours and Counting
3. Realtor.com Hacked Day 5: Communication Breakdown

Of all the serious flaws in HVCC that stand to hurt consumers, Realtors, appraisers and lenders, Richard fails to address even one of the primary deal breakers that make HVCC a non-starter in its current form. When given the opportunity to name specific recommendations, Richard gives three specific examples:

• Recommendation for change in verbiage regarding “partial payment”
• Requests change in verbiage so that “licensed and trained” employees are required as opposed to “appropriately trained and qualified” employees
• Requests change in HVCC guideline that lenders may not use appraisal company that they have a 20% or more stake in so that lenders must have 0% stake in any company they use

Fair enough, three sensible suggestions until you consider that he has failed to address any of the real issues on the table that stand to detrimentally affect consumers and real estate professionals including those he represents, Realtors. While Realtors stand a very real chance to be hurt by HVCC in its current form, Richard’s comments to the GSE’s fail to even touch on the most pressing issues within HVCC but instead waste an opportunity by nit picking verbiage. One might characterize these oversights as a clear lack of leadership in representing the best interests of consumers and Realtors.

#########

LETTER SENT TO FREDDIE MAC AND FANNIE MAE:

April 30, 2008

Home Valuation Code of Conduct Response
Attn: Ray Romano, Senior Vice President, Credit Risk Oversight Freddie Mac
1551 Park Run Drive, Mail Stop D2Z
McLean, VA 22102-3110

Dear Mr. Romano:

On behalf of the 1.2 million members of the National Association of REALTORS®, I am writing to provide comments on the implementation of the Home Valuation Protection Code. NAR has approximately 30,000 appraiser members from across the country and approximately 750 retain our Residential Accredited Appraiser (RAA) and General Accredited Appraiser (GAA) designations.

NAR supports the independence of appraisers and the integrity of the appraisal process. We applaud the New York State Attorney General Andrew M. Cuomo and both government sponsored enterprises (GSE), Fannie Mae and Freddie Mac, for their efforts to address appraisal fraud in the mortgage industry. While the agreement addresses appraisal fraud, we have concerns with the implementation of the proposed “New Home Valuation Protection Code” through the newly created “Independent Valuation Protection Institute.”

The agreement signed between the New York State Attorney General and Fannie Mae and Freddie Mac expires in 28 months. The newly created Independent Valuation Protection Institute will be funded by both GSEs for 5 years. The agreement is silent on how the GSEs will operate with respect to appraisals after the agreement expires. There is no indication from any party involved in the negotiations that the agreement will continue after 28 months, if one or both of the GSEs will return to pre-agreement appraisal requirements, or if a third option will be explored. It is also unclear how the Independent Valuation Protection Institute will be funded after 5 years or if more than the $5 million allocated by the GSEs is required to fund its operations.

NAR recommends the Independent Valuation Protection Institute be affiliated with an already existing appraisal organization. This will help to ensure that the code is implemented in such a way that it adds value to the appraisal process rather than becoming a duplicative layer of bureaucracy. If properly implemented the code will compliment, rather than duplicate or contradict, already existing appraisal codes such as the Uniform Standards of Professional Appraisal Practice (USPAP). Further, the Independent Valuation Protection Institute will be better positioned to work in conjunction with appraisal organizations and state regulatory agencies to ensure the independence of appraisers and the integrity of the appraisal process.

There is concern that GSEs will increase their reliance on automated valuation. While this would appear to address appraiser influence in a transparent way, a deeper look at automated valuations generally reveals they are not able to consider qualitative factors with the same level of reliability that professional licensed and certified appraisers produce. Professional appraisal organizations and licensed and certified appraisers should work closely with the GSEs to ensure the highest quality appraisals remain the preferred method of valuation for residential real estate transactions.

The agreement reached between the New York State Attorney General and the GSEs, including the valuation code, does not address the costs of the real estate transaction. Appraisers will now have to consider their obligations to USPAP and the Appraisal Foundation and the additional burden of ensuring the Code, in conjunction with the institute, is being adhered to. This may also be an issue for lenders. The creation of a new set of standards to follow and a new oversight organization may lead to increasing cost of the real estate transaction. The GSEs and the institute should work to ensure this agreement is implemented without increasing costs of the real estate transaction.

Several items in the Home Valuation Code of Conduct should be clarified. NAR recommends the following modifications to the Code:

• Section I. 1) should include the term “partial payment” and should read “withholding or threatening to withhold a timely payment, or partial payment, for an appraisal report;”.

• Section V states that any employee of the lender be “appropriately trained and qualified in the area of real estate and appraisals.” The word qualified is not defined and does not necessarily mean that the employee must be a licensed appraiser. If the employee is not licensed, then the individual may be operating under the broad scope of “appraiser” without liability to be disciplined while acting like an appraiser. The employee should be licensed and certified by the state in which the property to be appraised is located. The same requirement should hold for employees of appraisal management companies as well.

• Section VI states that lenders or affiliates of lenders cannot use an appraisal report obtained by or through an appraisal management company that is owned by the lender or affiliate of the lender and that this prohibition does not apply where the lender has an ownership interest in the appraisal management company of 20 percent or less. Lenders should be prohibited from using an appraisal report from any appraisal management company where the lender or the lender’s affiliate maintains an ownership stake. Allowing lenders to obtain appraisal reports from appraisal management companies where the lender has a stake in ownership does not meet the spirit of this agreement and does not uphold the independence of the appraisal process.

Thank you for the opportunity to present the views of the National Association of REALTORS®. These comments are also being provided to Freddie Mac and the U.S. Office of Federal Housing Enterprise Oversight. If you have any questions or comments regarding this letter, please contact our Regulatory Policy Representative Jerry Nagy at 202.383.1233 or jnagy@realtors.org.

Sincerely,

Richard F. Gaylord, CIPS, CRB, CRS, GRI
2008 President, National Association of REALTORS®

The Cuomo/GSE Appraisal Deal April 30, 2008

New York State Attorney General Andrew M. Cuomo, Fannie Mae and Freddie Mac (government sponsored enterprises) reached an agreement on March 3, 2008, to change appraiser selection criteria that will help eliminate conflicts of interest on mortgage appraisals. The agreement has the support of the Office of Federal Housing Enterprise Oversight (OFHEO). There are three main components to the agreement:

• Establishment of the New Home Valuation Protection Code
• Banks will be required to adhere to the Code
• Formation of the Independent Valuation Protection Institute

The requirements will have a significant impact on appraisal practices by lenders as they will have to comply with the new requirements agreed-to by the government sponsored enterprises (GSE) if the lenders sell mortgages to the GSEs. The parties have agreed to get comment and concurrence from the federal banking regulators and HUD, as they move to implement the Agreement and the new Code of Conduct. The GSEs have agreed to implement the new Code beginning January 1, 2009. During 2008, the GSEs will get comments from market participants, and changes to the Code are possible.

Home Valuation Protection Code
A Home Valuation Protection code will be implemented establishing standards on solicitation, selection, compensation, conflicts of interest and corporate independence. Mortgage brokers are prohibited from selecting appraisers. Lenders will not use “in house” staff appraisers to conduct initial appraisals and will not use appraisal companies owned or managed by the lender. The code entitles the borrower to one copy of an appraisal report, free of charge, within 3 days of the closing of the loan.

Banks Will Adhere to the Code
Starting January 1, 2009, GSEs will no longer purchase mortgages from lenders that utilize internal appraisers for appraisal reports. Lenders will be required to represent and warrant that the appraisal report was obtained in a manner consistent with the New Home Valuation Protection Code.

Independent Valuation Protection Institute
A clearinghouse of appraiser information will be created, with a separate board of directors, to monitor complaints from appraisers and consumers. All lenders will be required to provide post-purchase copies of appraisal documents to the clearinghouse. Lenders will establish a telephone hotline and E-mail address to receive complaints from appraisers and users of appraisal services on the improper influence or attempted improper influence of appraisers. The Institute will be headed by a Board of Directors with members having no financial connection with Fannie Mae, Freddie Mac, or lenders with whom the GSEs engage.

Frequently Asked Questions
Does this agreement concern only mortgages in New York State?
No, this agreement applies to mortgages across the country. After January 1, 2009, the GSEs will not purchase single-family loans from mortgage originators in any state that do not agree to adopt the Home Valuation Protection Code.

Does this agreement apply to all lenders?
GSEs may exclude lenders that meet the definition of “small bank” according to 12 USC§ 2908 and which the GSE determines would suffer hardships from the provisions of paragraph VI, subsections 1-4 of the Home Valuation Protection Code. However, excluded lenders must otherwise comply with the other provisions of the Code and meet appropriate standards of appraiser independence.

Who is responsible for applying the new Valuation Protection Code?
The government sponsored enterprises will apply the new code to lenders selling mortgages on the secondary mortgage market.

Will appraisers have to help fund the Independent Valuation Protection Institute?
No, the institute will be funded by the GSEs. Fannie Mae and Freddie Mac will each contribute $12 million over five years beginning in 2009.

What does this agreement mean for the independent appraiser?
Independent appraisers and appraisal companies not owned or managed by lenders or settlement companies must continue to meet appropriate standards of appraiser independence, including following Uniform Standards of Professional Appraisal Practice (USPAP) and maintaining relevant state certifications.

What does this agreement mean for REALTORS® ?
Individual REALTORS® cannot serve as a third party between a lender and appraiser. This includes selection, retention, and compensation of an appraiser.

Broker REALTORS® that offer services as a lender or affiliated lender and appraiser services must comply fully with the Home Valuation Protection Code if there is an expectation that their loans will be purchased by Fannie Mae or Freddie Mac after January 1, 2009.

Is NAR going to provide comments and recommendations on the agreement?
Yes, NAR will provide comments and recommendations to OFHEO on the Code and its implementation. NAR will comment on the creation of Independent Valuation Protection Institute; which should likely be affiliated with the Appraisal Foundation. Finally, NAR will comment on the impact this agreement will have on its members and the overall real estate industry.

Can lenders continue to own appraisal management companies (AMC)?
Yes, lenders can continue to own AMCs. According to the agreement, if a lender chooses to obtain appraisal reports from an AMC that is owned by the lender, or an affiliate of the lender, the lender must: 1) maintain 20 percent or less ownership in the AMC, 2) have no involvement of day-to-day business operations of the AMC, 3) the AMC is operated independently, and 4) the lender has no role in the selection of the appraiser.

Is this agreement federal law?
No. This is an agreement signed by two government-sponsored corporations, Fannie Mae and Freddie Mac, and the New York State Attorney General, Andrew Cuomo. The federal regulator of Fannie Mae and Freddie Mac, the Office of Federal Housing Enterprise Oversight (OFHEO) also signed the agreement. No legislation was passed or signed into law with respect to this agreement.

Are real estate agents prohibited from communicating with appraisers?
No. There is only one portion of the code that applies directly to real estate agents. Part III states that third parties, including real estate agents, cannot select the appraiser or compensate the appraiser. A third party, including real estate agents, can still ask appraisers for additional information, provide additional information to an appraiser, or ask for corrections of factual errors.

Can lenders work only through appraisal management companies?
No, lenders that utilize in-house appraisers can still order appraisals as long as they are independent of the loan production staff and do not ultimately report to an officer who manages loan production.