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As I was telling a reporter the other day, I don’t understand the Jayson Blairs of this world. You just cannot make this sh** up! Truth is way better than fiction, especially when it comes to real estate.

Background: I was honored to be a judge last week for Housingwire Magazine’s First Annual “Tell Me Your REO Story” Agent X Superstar Competition. Here I am with the other two judges, Mary Frances Burleson,  President and CEO of Ebby Halliday Realtors,  and Bubba Mills, president of Corcoran Coaching. Talk about hanging with power people, I was looking for Tom Hicks to walk in the door any minute! Instead of doing one of those phoney baloney “Best Realtors” deals, Housingwire said show us the money, honey. Send us your worst ever listing ever and what you had to do to sell this thing, and we will pick the toughest, most compelling story and make you an Agent X REO Superstar. Housing wire got 60 entries. Dallas agent Keith Yonnick saw this post on my site and entered.

He won second place!

Bubba, Housingwires’ Richard Bittner, moi, Mary Frances

I’ll show you each one of the five finalists in the weeks to come. You’ve gotta hear these tales of the sale. The winner collected $100,000 in free marketing for the next year. I’m thinking of unabashedly copying this idea at Candy’sDirt.com. And if, after reading these stories, you do not think our Keith Yonnick and the other four guys are effing geniuses, well, I guess I’ll go start blogging about cars or something.

Dallas home values are up 3.5 percent year over year.

It’s something that Candy is working hard to ingrain upon me, but I’m sure you all know this by heart: Real estate is a local story.

So when I read the newest Housing Price Index report from CoreLogic yesterday, I’ll be honest, I kind of yawned.

Sure, it shows that Dallas home values are up 3.5 percent year over year. If you don’t count distressed sales, like short sales or *gasp* foreclosures, then home values are up 5.4 percent. That’s good news for Dallas, and really good news for Dallas residents with homes either poised or on the market.

But CoreLogic is kind of preaching to the choir, isn’t it? Houses are moving and inventory short, so of course, prices are going to inch upward. We’ve heard it first-hand from agents every time we report a story like this.

What I think is ridiculous, though, is the national summary. CoreLogic’s report shows that U.S. home values are up 1.1 percent over the past 12 months, which includes booming markets such as the Phoenix area, which is seeing amazing appreciation at 11.3 percent, and severely depressed markets, such as Chicago, which could be bottoming out with home values dropping 7.3 percent since April 2011.

What do you think? Is there such a thing as a national housing market?

Hopefully we'll be seeing fewer of these signs in the next 12 months.

So, we have good news and bad news. Which do you want first?

Well, the good news is that, after a relatively mild recession, the Dallas-area residential real estate market is poised for an uptick, propelled by job growth, a vigorous banking sector, and more people with a few bucks to spare, according to a report from LocalMarketMonitor.com.

The bad news? Well, we’re scraping the bottom right now. But hey, I’m no born optimist, but even I can find a silver lining: At Dallas’ worst, the rest of the country is much worse off.

Home values in the Dallas/Plano/Irving area are expected to drop 1 percent in the coming 12 months, the report speculates. Nationwide, prices are expected to fall 2.6 percent.

An indicator of a favorable residential real estate market is rents. High rents = A good time to buy. Low rents = Make friends with your landlord. In the Dallas area, the rent forecast is expected to outpace home prices by quite a bit, so get those printers stocked and fax machines serviced, folks.

And our population is growing, too, and at a faster rate (2.6 percent) than the national average (1 percent). That means cheaper homes for more people who have more money to spend on homes.

Sounds like a win, win, win situation for Dallas-area Realtors, especially with the likes of Garcia Desinor Junior saying, “This is going to be a great year for Dallas real estate. Values are beginning to stabilize and increase.”

Tell us: Are you bullish about the residential real estate market for the next 12 months?

Furthering the discussion on whether the credit agencies are using a flawed algorithm to determine our mortgage future, this comment from Dallas bankruptcy attorney Reed Allmand, Allmand Law, deserves its own post. Most homeowners who are underwater on their mortgages got there through home equity loans that Allmand says were used to retire the same type of debt you find on credit cards. And that is what got so very many people into a financial mess. Me, I remember Texas when you could not borrow one dime against your home to protect the homestead:

I disagree with the premise that the Experian algorithm is flawed by classifying a Home Equity Loan as a Consumer Credit Loan. Before the state legislature changed the law to allow Home Equity Loans, the only type of debt that could impair a homestead was a purchase money loan (a traditional mortgage loan), a mechanic’s/materialman’s lien, child support lien, or a IRS tax lien. The argument for allowing home equity loans was to allow consumers to cash out the equity in their property and encumber their homestead with a new debt so they could use the proceeds as they please.

The consumer then uses home equity loan proceeds to make consumer purchases or retire other debt. Unlike a purchase money loan (traditional mortgage) the consumer is not borrowing money to pay off a piece of real estate and build equity in that property. Instead, they are cashing equity in a piece of property to make consumer purchases. This most often is a sign of economic instability in my line of work.

I am a Board Certified Consumer Bankruptcy attorney and I have seen too many clients enter into a home equity loan they should not have. Many times these loans are used to pay off credit card debt. If the consumer had not paid off the credit card they might go into default and possibly be sued but they could not have their home foreclosed on. That is not the case when a home equity loan is used to pay off credit cards, because if the consumer defaults on the home equity loan payments they are subject to foreclosure. I have counseled many clients in this situation and would definitely advise consumers to think twice before getting a home equity loan.

Reed Allmand is a board-certified Dallas bankruptcy attorney and principle at Allmand Law.

Meet Logan Waller. Whenever I want to know something about foreclosures in Dallas, he’s my Ghostbuster on speed dial. Let’s face it: everyone loves a foreclosure. I swear I hear the word and my heart beats faster. Logan will be giving foreclosure updates regularly now on CandysDirt.com. Here’s his overview of the foreclosure market in Big D — and yeah, we missed a great op at The W but here’s one in Preston Hollow:

There’s a lot of opportunity in today’s market for cash buyers and buyers who can put at least 20-30% down. Urban apartment communities are increasing rents and lowering incentives, which makes cash flowing a condo more likely than in the past. Significant leading indicators tell us the long term economic outlook for urban Dallas will fare well. The short term housing market, on a less positive note, won’t be so rosy. (Sorry, got to be honest.) The tax friendly environment for corporations and individuals will continue to spur more corporate re locations from the west coast. Investor activity is increasing now on properties over $100,000 due to the long term urban outlook. We’re seeing an influx in cash buyers taking advantage of the pricing of potential rental condos, and many properties under $200,000 can now cash flow. Considering the economic conditions and outlook for urban Dallas, investors should be considering multifamily and single family properties since rents are finally increasing in urban Dallas. Interest rates are likely to remain stable and inflation is highly likely over the next several years.

We’re currently working with an international hedge fund that acquires residential properties. They could invest anywhere in the world, but they have chosen Dallas, TX for their first round of acquisitions. This is becoming more and more common with international and out of state investors.

Some examples of opportunities we’re seeing are similar to this unit at the W: 2323 N Houston unit 1034. We contracted for less than $225,000 AND the property was in move-in condition. Downtown view, over 1,100 square feet on the 10thfloor of the W.  Like many of the high-end luxury high rises in Dallas, the W has taken a hit. Prices have declined as much as 50% since the peak of the luxury high rise market. But you have to move fast when these opportunities come up. We usually recommend to our condo inventory to keep values as stable as possible throughout uptown. 

 

 

2205 Waterford FM

Could Texas law net someone a $300,000 house for filing a $16 fee on line?  Maybe. Kenneth Robinson told WFAA-TV he moved into the house at 2205 Waterford Drive on June 17 because it had the perfect storm: the home was abandoned for foreclosure, then the mortgage company that owned it went out of business. After researching a Texas law called “adverse possession” Robinson moved in. It’s not a normal process, he admitted to WFAA-TV, but a process that is not known to many people.

Say what?

Robinson claims he filled out an online form and then filed it at the Denton County courthouse for $16. This gives him rights to the house, which was abandoned due to a foreclosure. Now he is claiming ownership.

He allowed WFAA reporters inside: the house is virtually empty, with just a few pieces of furniture. Oh and Robinson has not yet turned on utilities, at least as of the report so there is no running water or electricity.

(Wonder how he’s flushing toilets?)

The neighbors on this pretty little street took note when he moved in without the usual sale or, I guess, moving van.

“What paperwork is it and how is it legally binding if he doesn’t legally own the house?” said Leigh Lowrie, a neighboring resident. “He just squats there.”

Lowrie says the house was in foreclosure for more than a year and the owners  walked. Then, the mortgage company went out of business. Neighbors are naturally peeved that this guy may net a home scot-free.

Robinson claims Texas law gives him exclusive negotiating rights with the original owner because he has set up camp in the home. If the owner wants him out, he would have to first pay off his mortgage debt and the bank would have to file a “complicated lawsuit.” An underwater, likley bankrupt ex-homeowner is probaby not going to do that. Robinson says the law says if he stays in the house, after three years he can ask the court for the title.

When neighbors complained about Robinson’s takeover to law enforcement, they were informed that it was a civil matter and they were unable to intervene.

I called one title attorney on this case who did not wish to comment on the record. But he told me he seriously doubted that Robinson will get ownership of this home, but he may get a free place to live for several months. The owner of the home will be whoever acquires the assets of  the defunct mortgage company, but that company will have to re-group and take legal action against Robinson. And that could take months.

But hey, if my source is wrong, and Ronbinson nets himself a $300,000 home for $15, I’m grabbing my sleeping bag and heading to the courthouse!

What do you think?

A reader writes:

This is regarding David Bagwell. We are in love with his neighborhood, and are considering lot in Broughtonbut his behavior is causing us a lot of concern. Do you know how his bankruptcy has affected his strong hold on his communities?

A little background here: Developer David Bagwell, who once worked with Mayor Leppert at the Trammell Crow Company,¬† has super strict rules for just about every move you make if you buy a home in one of his five Colleyville developments: who builds the house, who repairs it, what you can plant, where you can plant it, even how many inches away the front door coach lanterns have to be. And when you submit your new home or remodel plans to the Architecture Control Committee, you have to pay a fee. About this time last year here’s what we were discussing on DallasDirt: “David Bagwell is working as hard at staving off foreclosure on some of his Colleyville lots as he once did being the architectural control Nazi of the neighborhood. As one reader put it, not only did he peer over fences to check for compliance, homeowners were charged repeatedly just for submitting and re-submitting requests:

“Candy, you missed one thing about submitting for approval. Not only do you have to submit for approval, if it is declined, you have to pay a fee to resubmit. Basically the entire fee structure is set up to fail to keep submission payments coming in. You have to pay a fee to submit for approval to stain your garage the SAME color it currently is.
The CCR’s are located on Bagwell’s website. If you have 10 hours to waste, go read them.”

I don’t have ten hours to waste. Last I heard, Bagwell’s lots got foreclosed on, Toll Brothers has picked up some of his mortgage notes, which ought¬† to make homeowners in three of the subdivisions perk up: If Toll bought the 26 lots in Broughton, 49 lots in Old Grove and 36 lots in Whittier Heights, they could ask for control of the development, shake things up at the HOA. Life might be groovy again.

Any of my Southlake/Colleyville readers know if the foreclosure has made these communities a more pleasant place to live? And here we thought fore-closure was a bad thing!