Bay Area Real Estate Update April 2023

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Real Estate

Are You on Fannie Mae's 'Blacklist'? How to Check and What it Means for Condo Owners

Fannie Mae and Freddie Mac, two of the largest lending companies in the US, have introduced new lending standards to prevent disasters like the Surfside condo collapse in Florida.

These new standards aim to weed out condos and co-ops that have deferred maintenance, structural safety issues, or shaky finances. However, this has resulted in many buildings being put on Fannie Mae's "blacklist," making it harder for buyers and owners to secure conventional financing.

The problem is, Fannie Mae's list is confidential and only available to lenders and servicers. This means that many condo buyers and owners are unaware that their building is on the list until they apply for a loan, sometimes in the middle of a sale. Buyers and owners should do their due diligence and check if their building is on the list to avoid any surprises during the loan application process.


The Wealth Gap in Real Estate: How Income and Race Impact Home Appreciation

According to a new study from the National Association of Realtors, homeownership remains a key factor in building wealth, but substantial inequities along racial and income lines persist.

The study found that higher-income homeowners gained greater home appreciation since 2012 compared to lower-income homeowners. Middle-income homeowners gained $122,100 in wealth, with homes appreciating 68% over the past decade. Low-income homeowners were able to build $98,900 in wealth, while upper-income households saw an increase of $150,800.

However, the study also shows that homeownership can be a catalyst for building wealth for people from all walks of life. A monthly mortgage payment is considered a forced savings account that helps homeowners build a net worth about 40 times higher than that of a renter.


Foreclosure Filings Spike 22% in the US: Are Homeowners at Risk?

According to a recent report by ATTOM, foreclosure filings in the US rose 22% in the first quarter of 2022 compared to the same period last year. This marks the 23rd consecutive month of annual increases in foreclosure activity.

The rising trend is attributed to ongoing economic challenges, higher jobless rates, and backlogged foreclosures in the pipeline after government interventions to help struggling homeowners were lifted during the pandemic. However, with many homeowners still having significant home equity, increased levels of foreclosure activity may be kept at bay.

Major metropolitan cities, including New York, Chicago, and Los Angeles, had the highest number of foreclosure starts last quarter, while Michigan topped the list of states with a 41% increase in foreclosure filings. Fayetteville, North Carolina, had the highest foreclosure rate among major metro areas.


How to Get Your Home Sold Faster

Zillow has identified several home features that can help sell a property faster during the spring-buying season. These features include a doorbell camera, open shelving, heat pump, fenced backyard, mid-century design, hardwood floors, walkability to nearby areas, shiplap, and gas furnace. According to Zillow, a home with a doorbell camera could sell 5.1 days faster than one without. Other features such as open shelving, a heat pump, and a fenced backyard can help sell a home up to 3.5 days faster. Homes with mid-century designs, hardwood floors, walkability to nearby areas, shiplap, and gas furnaces can sell up to 2.8 days faster. If a home already has these features, highlighting them could help sellers fetch more money or sell their property faster.


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Oakland's Ban on Evictions to End in July

Starting July 15, Oakland property owners can evict tenants for failure to pay rent under a compromise end date to the city’s COVID-era ban on evictions. The council voted 7-1 to sunset the pandemic-era policy, while adding permanent “just cause” protections to prevent evictions on flimsy pretenses. Tenants will not owe “back rent” for unpaid rent since the eviction moratorium first took effect in March 2020, as long as they can demonstrate financial losses due to COVID. And landlords can’t remove a tenant who owes less than a month of what’s considered fair rent for an equivalent unit on the market. It took city officials weeks to fine-tune the new ordinance’s details amid contentious debate between East Bay landlords and the city’s renters.