It’s terrifying but it’s true. One minute you think you own a property and the next, it has been recorded in someone else’s name. Fraud in real estate is alive and well, with authorities all over the country saying homes are illegally taken without owners’ consent.


Because of the ever-growing rise of technology, it is now easier than ever to create fraudulent documents that can be easily recorded in public records making your house appear that it was sold and now belongs to someone else.


In a Texas case, a deed turned out to be a forgery perpetrated by a daring group of rogue businessmen who claimed ownership of more than 70 vacant houses and lots across Houston. These con artists allegedly made millions by reselling them to unwitting buyers, according to a Houston Chronicle analysis of pending civil and criminal lawsuits.

The players in this massive swindle simply strolled into the Harris County Civil Courthouse with fake deeds bearing the freshly minted signatures of long-dead men, faked notaries’ seals and other blatantly false claims to seize and sell others’ property, according to the Chronicle. The consequences of this fraud — carried out between 2002 and 2008 — continue to affect hundreds of people in some of the city’s humblest neighborhoods and much of the mess remains unresolved.


Your best defenses against fraud of this kind are awareness and diligence, not permitting yourself to go on autopilot. The most straightforward way to make sure you are not a victim of this sort of fraud is to check public records regularly, looking for changes. Every city has a place where the public can go to search for information on a property. Property records are maintained at either the county courthouse, county recorder, city hall or another city or county department. Many public offices are staffed by knowledgeable personnel ready to help you find property deeds and encumbrances.


Telltale signs something is amiss would be things like getting mail addressed to a different name at your address or seeing that mail you normally might receive regarding your home is no longer arriving in your mailbox. Any new deed recorded in the public records triggers a slew of mail advertisements, so they are a great warning sign that something is up.


Another sign is sudden unsolicited interest from prospective real estate agents or home service-related companies. If anything sends up a red flag, go online and check for changes. Then check it again a few weeks later to confirm.

Vacation homeowners will need to be extra-vigilant, since these sorts of properties are especially vulnerable to fraud. Find a neighbor, or hire a reputable property manager, to regularly check and report on your property. Also, make sure to have mail related to that property forwarded to you, and be concerned if the flow stops unexpectedly.


Most times there will be nothing amiss regarding the ownership of your home. But it’s much easier to take steps to avoid a problem of this proportion than to spend a lot of time and money fixing it.


Source: Sun Sentinel, Houstong Chronicle, TBWS

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There are few more interesting real estate investments than home flipping — seeing an older or run-down piece of property find a fairy godmother to make it beautiful again and then being sold in several months’ time. According to a report in, home flipping activity is increasing across the country, as more investors look to capitalize on the run-up in home prices.


There’s limited opportunity to flip houses now: Sidney Torres from CNBC.


On par with the highest home-flipping rate since the first quarter of 2012, nearly 50,000 single-family homes and condos were flipped in the first quarter of this year, comprising 6.9 percent of all home sales, according to ATTOM Data Solutions’ Q1 2018 U.S. Home Flipping Report.


Even profits were up. with flips in the first quarter of this year selling at an average gross profit of $69,500, up from $66,287 a year ago, the highest average gross profit for flips since ATTOM began tracking such data in 2000. A flip is defined as a property that has been sold more than once in a 12-month period.


The data company’s senior VP Daren Blomquist is cited in the report saying, “The 2018 housing market is a double-edged sword for home flippers. Rapidly rising home prices boosted by low inventory of homes for sale or for rent are padding profits at the back end when flippers sell. But those same market realities are eroding flipping returns at the front end by forcing flippers to pay more to acquire homes to flip.”


Memphis, TN won the prize for the highest flip rate of the 136 metros with 15.1 percent, followed by Albany, Ore. (11.7 percent); East Stroudsburg, Pa. (11.4 percent); York, Pa. (10.4 percent); and Merced, Calif. (10.3 percent).



Source: NAR, TBWS

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The major stock market indexes made a solid advance during the week amid strong jobs and economic data resulting in lower bond prices and rising yields.  Tuesday, the ISM Non-manufacturing Index showed a greater than forecast expansion in the services sector with a reading of 58.6 in May from 56.8 in April.  This increase matched the rise in the ISM Manufacturing Index for May, suggesting second quarter GDP growth will show a noticeable increase over GDP growth in the first quarter.


Also on Tuesday, the monthly Job Openings and Labor Turnover Survey (JOLTS) showed there were 6.698 million job openings available in April with only 6.4 million available workers to fill them.  This is the second month in a row where there were more job vacancies than available hires, a phenomenon the American economy has never experienced before until March and April of this year.  Although this situation should create a demand for higher wages, average hourly earnings only increased 2.7% annualized in May, up one-tenth of a point from April.  However, you can bet the Fed will be keeping a close eye on wage growth going forward, and there is no doubt that they will raise interest rates for the second time this year when they announce their rate-hike decision this Wednesday.


There was one housing related report released this past week.  Tuesday, CoreLogic reported their latest Home Price Index (HPI) and Forecast for April 2018 showing home prices increased by 1.2% month-over-month in April and by 6.9% year-over-year from April 2017.


CoreLogic is forecasting their national HPI will continue to increase 5.3% on a year-over-year basis from April 2018 to April 2019 and will rise another 0.2% for May 2018.  Frank Nothaft, CoreLogic Chief Economist, remarked “The best antidote for rising home prices is additional supply.  New construction has failed to keep up with and meet new housing growth or replace existing inventory.  More construction of for-sale and rental housing will alleviate housing cost pressures.”


Analyzing home values in the country’s 100 largest metropolitan areas based on housing inventory indicated 40% of metropolitan areas had an overvalued housing market, 28% were undervalued, and 32% were considered at value as of April 2018.  When evaluating only the top 50 markets, 52% were overvalued, 14% were undervalued and 34% were at-value.



From the mortgage industry, the latest data from the Mortgage Bankers Association’s (MBA) weekly mortgage applications survey showed an increase in mortgage applications.  The MBA reported their overall seasonally adjusted Market Composite Index (application volume) increased 4.1% during the week ended June 1, 2018.  The seasonally adjusted Purchase Index rose 4.0% from the week prior while the Refinance Index also increased by 4.0% from a week earlier.


Overall, the refinance portion of mortgage activity increased to 35.6% from 35.3% of total applications from the prior week.  The adjustable-rate mortgage share of activity increased to 7.1% from 6.7% of total applications.  According to the MBA, the average contract interest rate for 30-year fixed-rate mortgages with a conforming loan balance decreased to 4.75% from 4.84% with points decreasing to 0.46 from 0.47.


For the week, the FNMA 4.0% coupon bond lost 34.4 basis points to close at $101.594 while the 10-year Treasury yield increased 4.8 basis points to end at 2.950%.  The three major stock indexes advanced during the week.


The Dow Jones Industrial Average gained 681.32 points to close at 25,316.53.  The NASDAQ Composite Index added 91.18 points to close at 7,645.51.  The S&P 500 Index added 44.41 points to close at 2,779.03.  Year to date on a total return basis, the Dow Jones Industrial Average has gained 2.42%, the NASDAQ Composite Index has added 10.75%, and the S&P 500 Index has advanced 3.94%.


This past week, the national average 30-year mortgage rate increased to 4.68% from 4.60%; the 15-year mortgage rate rose to 4.11% from 4.04%; the 5/1 ARM mortgage rate increased to 3.94% from 3.93% while the FHA 30-year rate climbed to 4.42% from 4.38%.  Jumbo 30-year rates increased to 4.70% from 4.66%.


Economic Calendar – for the Week of June 11, 2018


Economic reports having the greatest potential impact on the financial markets are highlighted in bold.


Mortgage Rate Forecast with Chart – FNMA 30-Year 4.0% Coupon Bond


The FNMA 30-year 4.0% coupon bond ($101.594, -34.4 bp) traded within a narrower 42.2 basis point range between a weekly intraday high of 101.938 on Monday and a weekly intraday low of $101.516 on Thursday before closing the week at $101.594 on Friday.


The bond fell from its position sitting on the 50-day moving average (MA) and continued to slide lower during the week to end just below the 25-day MA.  Technically, the last sell signal from May 31 is still in effect and since the bond is still not “oversold,” there is some continuing risk for further mortgage bond price erosion this week.  A continuing price move toward the next support level will result in a slight increase in mortgage rates in the coming week.



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