Piedmont, CA (PRWEB) October 16, 2014
As the US economy continues to improve, there are many people wondering when the housing market will face a flood of homes previously held by financial institutions. When will it hit? Will it be a flood or a trickle? And, how much will it disrupt the housing recovery? These are the primary concerns of people watching the real estate market, according to an article in Realtor® Mag, “Emerging From the Shadows” in September, 2014. (1)
“Even with the shadow inventory, there are still too many variables to predict how that inventory will impact the market.” Some of Tunney’s variables include human nature, capitalism, and the federal government. CoreLogic’s January 2014 National Foreclosure pegs the shadow inventory at 1.7 million homes—which is half of the peak levels in 2010, which were 3.4 million homes. CoreLogic explains that shadow inventory consists of homes with mortgages that are 90 or more days delinquent and potentially moving into foreclosure. What this means is they are in the process of becoming REO, or real estate owned by financial institutions, that may or may not be placed on the market in the near future.
“Overall, I don’t think anyone wants to see a reversal in the current housing market as we approach 2015, so a flood of new, cheap, inventory seems unlikely,” Tunney commented. This sentiment could explain why independent banks, Fannie Mae, and Freddie Mac are all being more cautious in handing over their properties to real estate agents; by sprinkling them into the market they can keep prices up. Additionally, these institutions – especially Freddie Mac – are not discounting the properties. “By keeping prices up,” Tunney remarked, “banks are able to recoup their investment and protect the values of other properties they hold mortgages for.”
The Mortgage Forgiveness Debt Relief Act of 2007 expired at the end of 2013, terminating tax relief on forgiven mortgage debt. Without this relief, owners are better off going into foreclosure instead of trying for a short sale. “If the government does not reinstate the Debt Relief Act, shadow inventory will only increase,” remarked Tunney. New listings in Piedmont include, 212 Bonita Ave, Piedmont offered at 2,150,000.
Even high-end real estate, such as that in Tunney’s part of the San Francisco Bay Area, is at risk if financial institutions decide to off-load significant portions of their holdings. Offers on homes for sale in Piedmont, such as 6 King Avenue – offered at $4,200,000, would dry up if people moving up could do so for significantly less money.
About Anian Tunney, Broker Associate
Anian Tunney is an agent broker with The Grubb Company. According to statistics collected by East Bay Regional Data, Inc., she was the 2013 number one real estate agent in Piedmont, CA for the number of units sold and sales volume. Additionally, Tunney is always in the top two in yearly real estate sales for The Grubb Company’s Piedmont, office. She is known for her knowledge, experience, and network in the Piedmont community; qualities which are invaluable for finding that special home or buyers for her clients.
A fifth generation Piedmont resident, Tunney has been with the Grubb Company for over 30 years. She raised her family of four in Piedmont and is active in community projects such as the Piedmont Beautification Foundation, the East Bay Museum Auxiliary, and the Piedmont school district. Her grandmother, Amy Sutton, was a real estate agent, and now Anian works with her daughter Adrienne Krumins, making Piedmont Realty truly a family vocation. Tunney negotiates with grace and clarity of purpose. She can be contacted at 510-339-0400 ext 217, and at tunney(at)grubbco(dot)com. Her website is aniantunney.com.
The Grubb Company Real Estate Brokers
Oakland, CA 94611
510-339-0400 ext 217
(1) Realtor Mag, Emerging From the Shadows” September, 2014