Tuesday, December 09, 2008

I can help you avoid foreclosure

Hi, my name is Michael Hon and I am the broker and owner of Iron Eagle Realty. Did you know that 67% of homeowners don’t know where to turn to avoid foreclosure and don’t know what to do. Did you know that most lenders do not want to foreclose on your home? I specialize in counseling individuals in what their options are in a foreclosure situation, including, potentially staying their home. So if you have missed a payment or might miss a payment, please give me a call at 208 939 9033 ext 2. I am here to help. 

Michael Hon
Borker / Owner, Iron Eagle Realty
Certified Short Sale Specialist

Monday, November 10, 2008

Bank Owned Properties - Boise, Idaho

If you are looking to buy BANK OWNED PROPERTIES in the Boise, IDAHO area at 70% of current market value, please call me at 208 919 0458 or email me at michael.hon@IronEagleRE.com. I am a Certified Short Sale SpecialistTM. To download "Short Sales 101 for Buyers", please click here.

Michael Hon
Broker - MBA, GRI

Certified Short Sale and Foreclosure Specialist
Investment Property Consultants
Direct 208 919 0458

Focused on Building Your Wealth

$149500 Move in Ready SFH in Meridian, Idaho

98 W Woodbury, Meridian, ID 1314 SF, 3Br 2Ba built in 1993. (This is not a SHORT SALE). Move in Ready! Clean as a whistle! Immaculate and private backyard. Perfect for “down-sizers”. RV parking on the side. Low maintenance. Bright kitchen with skylight and split bedroom plan. Fireplace in the family room. Backs up to walking path, no back neighbors. A Must See! Please call me at 208 919 0458 or email me at michael.hon@IronEagleRE.com. Please visit my website at IronEagleRE.com

Michael Hon
Broker - MBA, GRI


Certified Short Sale Specialist
Investment Property Consultant

Office 208 939 9033 ext 2


Thursday, September 18, 2008

$160000 Meridian, Idaho - Short Sale 4 br 2 ba 1759 SF w/Big Bonus Rm

SHORT SALE! MAKE AN OFFER! 648 W Woodbury, Meridian, ID 1759 SF, 3Br 2Ba built in 1995. Spacious Two Story Home. Master on main and three bedrooms on 2nd floor. Huge bonus room with cozy gas fireplace. Large backyard, covered patio and built in wet bar. Backs up to walking path and common area. Please call me at 208 919 0458 or email me at michael.hon@IronEagleRE.com. Please visit my website at IronEagleRE.com

Michael Hon
Broker - MBA, GRI


Certified Short Sale Specialist
Investment Property Consultant

Office 208 939 9033 ext 2

$145000 Pre-Foreclosure - 4 Br 2.5 Ba w/Office 1929SF - Meridian, IDAHO

SHORT SALE SINGLE FAMILY HOME! HUGE (1929 SF) Tri-Level Home in quiet neighborhood. Four bedroom, two and one half bath. Master on the main level with office downstairs off family room. Close to shopping and schools. Fireplace in family room. Plenty of space with 3 bedrooms on the main floor and one below. Please call me at 208 919 0458 or email me at michael.hon@IronEagleRE.com. Please visit my website at IronEagleRE.com

Michael Hon
Broker - MBA, GRI

Investment Property Consultants
Direct 208 919 0458


Free Foreclosure List - Boise, Idaho

If you are looking to buy properties in the Boise area at 70% of current market value, please call me at 208 919 0458 or email me at michael.hon@IronEagleRE.com. I am a Certified Short Sale SpecialistTM. To download "Short Sales 101 for Buyers", please click here.

Michael Hon
Broker - MBA, GRI

Investment Property Consultants
Direct 208 919 0458

Focused on Building Your Wealth

Iron Eagle Realty
Investment Properties
Certified Short Sale Specialist
: Foreclosures and Short Sales#links

<b>Iron Eagle Realty<br>Investment Properties<br>Certified Short Sale Specialist</b>: Foreclosures and Short Sales#links

Monday, August 18, 2008

Short Sale 101 for Buyers

As a buyer watching the real estate market, you are undoubtedly aware that there are more "short sale" properties on the market, at least in many areas. A short sale is a home where the market value of the property is LESS than the loan amount owed to one or more lenders. And buyers often believe that these are the best deals, along with foreclosures. In the Intermountain MLS that encompasses South Central to South Western Idaho, 26% of pending deals are short sales and 10% of all listings are short sales with MORE TO COME. Short sales are and will be a way of life in the real estate market for the next two to three years.

Don't be scared off by these short sale properties as they may turn out to be a great deal for you.
But you need to know a few things before you decide IF you want to pursue a short sale purchase:

I. Be prepared for a short sale to take more time (total time may be 60 days – 90 days) - this is one of the biggest complaints from buyers. If you do not have the patience, don’t go down the path of buying a short sale.
II. It is CHEAPER for the bank to consummate a short sale than take the property back as an REO.
III. You as the Buyer are much better off engaging with a Buyer’s agent who is a Certified Short Sale SpecialistTM than talking directly to the Sellers Agent. The Seller’s Agent is representing the Seller, not the Buyer and will not do the Buyer any favors.
IV. A seller must disclose if the home either IS a short sale or likely will be due to the market value.
V. A short sale MUST be approved by the lender. Even though a seller might accept your offer, it will be subject to approval by the lender
VI. Lender will (likely) send out an appraiser to evaluate the property in light of recent sales - they are looking for market value, too, and you cannot expect a short sale to be a fire sale (i.e., it may NOT be a great deal after all)
VII. Lender must receive hardship letter and other required documents from the seller in order to approve a short sale
VIII. Lender will likely have a checklist of requirements and paperwork required for the short sale process
IX. Lender will likely request that the sale be "as is" and due to hardship will probably not approve any credit for repairs

If you are making an offer:

1. Make sure you make the offer contingent on the short sale being approved by the lender and set a time frame for approval
2. An addendum form is advised to outline the short sale contingency terms and conditions
3. A letter to the seller is also advised requesting written confirmation that the lender has received the hardship letter and other documents as part of the short sale application
4. There is a good chance there will be more than 1 offer
5. It is still prudent (I would say it is ESSENTIAL) to conduct a home inspection even though the lender will probably require an "as is" sale - you still want to know what you are buying and what repairs need to be made

Be sure to discuss issues and questions with your agent before proceeding, preferably someone who has some experience with short sales or is a Certified Short Sale SpecialistTM

I would NOT recommend taking on a short sale purchase without representation by a qualified, knowledgeable licensed agent who is a Certified Short Sale SpecialistTM. There is too much at risk for you, the buyer. And remember, the listing agent represents the seller's interests, not those of the buyer.

Michael Hon
Broker – MBA, GRI
Certified Short Sale SpecialistTM
Investment Property Consultant
Iron Eagle Realty

Footnote: Sections IV through IX and Sections 1 through 4 of this post were re-published with permission from an article by Jeff Dowler of Re/Max Associates in Encinitas, CA. Click here to link to the complete article.

Saturday, August 02, 2008

Waiting to Buy may be the Wrong Strategy

The biggest risk for todays home buyers is interest rates not price depreciation. Yes, home prices are under pressure and there is inventory in the market, but waiting to define a bottom in a real estate downturn that is 24 months old and where prices have already adjusted, is very difficult.

The bigger issue and real risk to buyers are interest rates. A sudden rise in interest rates can easily erase the benefit of finding a home at a bargain. Long term interest rates are directly impacted by the health of our economy and inflation. If the economy if struggling or if there are rising expectations of inflation, long term interest rates will rise. Both of these factors are at work in the market.

Why are rising interest rates so bad for me? Because most people finance the purchase of their home and any increase in interest rates will decrease what you can borrow. The impact is significant. Here?s an example:

During the past 45 days (May 1, 2008 to June 15, 2008) interest rates on 30 year fixed mortgages have increased up to 0.75%. Now, this doesn?t sound like a large increase until you examine the impact on a borrower. A 0.75% increase in interest rate for a borrower who qualifies for a $400,000 loan would reduce their qualification to $369,900. This is a decrease of -7.6%. Unless the home has depreciated 7.6%, or the seller cuts you a deal, you've lost by waiting. You'll qualify for less or pay significantly more in interest over the term of your loan by waiting.

No one can accurately predict the future of real estate values, but historical trends tell us that over the long term, real estate is a great investment. In addition, prices have already adjusted in many markets. If you are considering buying a home, now is great time. Interest rates are still relatively low and the risk of rising interest rates is real.

Michael Hon
Broker - MBA, GRI
Iron Eagle Realty
208 919 0458
Michael.Hon@Iron EagleRE.com

Tuesday, July 29, 2008

Top 10 Tips To Get Good Deals in Short Sales and Bank Owned Property

Current real estate markets nationwide have created countless opportunities for buyers looking to purchase real estate priced well under market value. Many buyers have turned to short sales, foreclosures and bank owned (REO) properties hoping to be able to purchase real estate for pennies on the dollar. The buzz in distressed real estate has been perpetuated by urban legends; someone’s brother’s, friend’s, uncle’s, co-worker’s dog who bought a home at 10 cents on the dollar. This buzz is further fueled by late night infomercials filled with testimonials of people who "bought a $500,000 home for $12" and then try to sell you the secret program that teaches you to do the same. This article is intended to give you the straight scoop and also tips that will help get you a good deal.

How Low Will They Go?

People have a major misunderstanding of what they expect to accomplish when trying to purchase distressed or bank owned property. I emphasize trying because those same people end up never buying anything.

So how low will the bank go on a short sale or REO? If you’re hoping for a number, you can stop reading. If you’re hoping to steal the property, you can stop reading. If you’re hoping to buy property for 50% of market value, you can stop reading. If you’re hoping to wait and buy the property for less by dealing directly with the bank, you can stop reading.

There are four things you need to understand: 1) The bank only accepts short sales when they believe it’s in their best interest! 2) Banks do not voluntarily accept losses. 3) Banks will always try to limit their losses. 4) Banks know the fair market value of the property.

These four are in no particular order. If they were, number four would probably be number one. I talk to people on a daily basis who want to make offers so low, I can only assume they think the bank has no idea what the property is worth. Don’t be so naive. The bank has a legal obligation to get the highest amount possible for any property. The bank can even be held liable for the difference if they are negligent in approving a sale that is too far under fair market value with no justification. Stories of someone picking up a property at 50% of market value are either urban legend or missing critical factors that played a part in the purchase.

You Can Get Good Deals In Distressed Real Estate

Yes you can. Just be realistic. If you think you can purchase real estate at a 50% discount, you’re not realistic. There isn’t one single situation, no matter how desperate, that would cause an owner to sell their home for 50% under market value when an experienced Realtor can sell that same house for 30% under market value in the same amount of time under the same conditions. Anyone who tells you they did is leaving out part of the story. However, it is very possible to buy distressed homes at a 25% discount. Anyone who tells you a 25% discount isn’t a good deal, doesn’t know real estate or investing in it and you’d be better off steering clear of the real estate advice they have to offer. As a matter of fact, a 25% discount on anything you buy, whether it be gasoline, groceries or a car, is a great deal.

I see so many people that won’t buy unless they can get it for no more than 60 cents on the dollar. They pass on property that’s 25% under market value. Big mistake, here’s why:

Let’s assume there are 10 properties with market values of $100,000 each. 9 of these homes can be purchased for $75,000 each (25% discount) and one at $50,000 (50% discount). This is a fair ratio for illustration purposes. In the real world, it could easily take you more than a year to wait it out for the 50% discount. It’s very possible that you never find something discounted that much.

Investor A buys the 9 homes for $75,000 each

Investor B buys the 1 home for $50,000

Assuming a 5% annual appreciation for each property, this is what each investors real estate portfolio would look like 5 years later:

Investor A’s Equity = $473,653 ($100,000 original FMV x 5% annual appreciation x 5years - $75,000 purchase price x 9 properties)

Investor B’s Equity = $77,628 ($100,000 original FMV x 5% annual appreciation x 5years - $50,000 purchase price x 1 property)

Investor B’s strategy to wait for the great deal cost him nearly $400,000. He made the mistake most amateur investors make; focusing on only one thing - discounted value. Investor A created wealth through leverage. Professional real estate investors know that leverage trumps discounted value every day of the year. Leverage is so powerful, had Investor A bought all 9 properties at full market value ($100,000), he still would have equity of $248,653 or triple Investor B’s investment with a 50% discount. In this market, you can buy real estate at a 25% discount all day long and maybe never find the 50% discount.

Top 10 Tips For Purchasing Short Sales and Bank Owned Property

1. Be realistic. Reread the tale of two investors above if you still don’t understand how being unrealistic can and will cost you dearly.

2. Get off the fence and get in the game. If you’re waiting for the market to drop, reread the tale of two investors above to remind you of how much waiting can cost. Learn more about timing real estate markets here: Secrets for Timing The Real Estate Market

3. Know the true market value of your target property.

4. When making an offer, be able to support the amount of the offer. Pulling a low ball number out of thin air isn’t going to work. If you don’t understand why, reread the four things you need to understand in bold type above.

5. In a short sale, the bank will only accept your offer if it’s a better alternative to foreclosure. This means that the bank will take the fair market value of the property in its current condition, subtract the costs of foreclosure and selling it as an REO, and the "fudge factor". The "fudge factor" covers the costs that will accrue if the bank has to take the property back at foreclosure and includes lost opportunity, risk of vandalism of the vacant property after foreclosure, declining market risks and time to sell as an REO. The "fudge factor" will be the only area the bank will be willing to negotiate. This is the supporting amount mentioned in tip #4.

6. In REOs, the bank can be more "motivated" during certain times of the year. They will generally be more likely to entertain low offers at the end of the month, quarter and year. The banks want to get real estate off their books and these calendar targets can create motivation. But remember, be realistic. Just because it’s nearing the end of the year, doesn’t mean the bank is going to jump at an offer that’s ridiculous.

7. Having access to REOs before they are listed can give you a big advantage. How do you get this information? Here’s one way: Idaho REO Bargains

8. Don’t get emotional or stuck on any property. Real estate investing should be run like a business. Keeping emotions out of it allows you to make rational decisions.

9. Understand and accept the risks involved with these types of properties. To get the good deals, you will have to accept risks involved with them.

10. Retain the help of an expert Realtor with experience in these types of properties to help you. Don’t think you can do it yourself. That mindset can cost you thousands. Besides, as the buyer, you don’t pay for their services.

Michael Hon
Broker - MBA, GRI
Certified Short Sales Specialist
Iron Eagle Realty
208 919 0458

Tuesday, June 24, 2008

Certified Short Sale SpecialistTM

Within every major market shift lies opportunity. Although Idaho has not been hit as hard as California or some of the other larger states, short sales and pre-foreclosure properties currently make up 10%+ of the Boise, Idaho MLS. That number will continue to grow in the next two to three years.

I recently received a new nationally recognized designation of Certified Short Sales Specialist after taking an intensive two day class focused on all aspects of acquiring and listing short sale properties. In addition to my experience with short sales, this class afforded me a wealth of working knowledge that only a very small percentage of real estate professionals in our area hold. With the additional working knowledge that this designation brings, I can assist you in purchasing properties in Idaho at 70% of market value or less.

Banks do not want properties back as REO's. It will cost the bank 25% of the loan amount (on average) to take the property back and sell it as an REO. Banks want to avoid this scenario.

As I mentioned, there is money to be made with every major market shift. If you are interested in buying properties at 70% of current market value or less, please call or email for access to a list of local short sales. You can reach me at 208 919 0458 or email me at Michael.Hon@IronEagleRE.com.

Monday, April 21, 2008

Idaho foreclosures down from February, up 85% from year ago

Nationwide the trend is still negative; inventories of new homes in Ada and Canyon counties are slowly declining.

The number of Idaho homes in foreclosure in March was down 15 percent from the previous month, raising hopes that defaults may be ebbing.

RealtyTrac Inc., an Irvine, Calif., company that tracks the number of foreclosures nationwide, reported Tuesday that there were filings against 657 Idaho properties in March. While down from February, that's still 85 percent ahead of the comparable month a year ago.

A separate report last week said Idaho homes in foreclosure are now reaching the auction stage in massive numbers. But auctions by trustees follow initial foreclosure filings by several months, and as the number of foreclosures declines, the number of trustee sales is expected to follow suit.

The decline is most noticeable in the Treasure Valley. Ada County had 226 foreclosure filings in March, a 21 percent drop from 286 in February. Canyon County had 162 filings, down 24 percent from 212.

"It could be a sign that we could be getting close to the bottom," said RealtyTrac spokesman Daren Bloomquist. "But it's hard to tell after just one month."

Nationwide, the trend is still negative. RealtyTrac said 234,685 properties were in some stage of foreclosure in March, a 5 percent increase from the previous month and 57 percent higher than March 2007.

Idaho's foreclosure problem is being driven by subprime mortgages made at the height of the Treasure Valley building boom, said Marc Lebowitz, executive director of the Ada County Association of Realtors.

Research by the National Association of Realtors shows that the foreclosure inventory in Idaho for prime mortgages moved from 0.34 percent of all loans in the third quarter of 2007 to 0.42 percent in the fourth quarter, Lebowitz said . For subprime mortgages, foreclosure inventories increased from 3.78 percent to 5.08 percent of all loans serviced in the state.

Boise River Properties, a local real estate brokerage, expects to see fewer foreclosures now that the boom is over and buyers are not being encouraged to use exotic financing to buy more house than they can afford.

Caron blamed the foreclosure boom on lax lending practices and individual buyers and investors who used 100 percent financing to buy homes that were anywhere from $110,000 to $200,000 more than they could afford.

"Houses in the $250,000 range are moving," Caron said. "And we're talking with banks who work with developers, and they will finance houses in that range. And when you consider that the average two-income family in the Valley is $56,000, $250,000 is what they can afford."

He said the idea that there are "super bargains" to be had at auction sales is "non-existent." A bank with a home with an assessed value higher than the amount owed on the property will take the property back and hope to get most of its money back when the market ultimately rebounds, he said.


Shaun Tracy, an associate Realtor with Re/Max Capital City said the number of newly constructed homes for sale in Ada County has fallen from 1,594 on Feb. 6 to 1,252 as of Monday.

"That's good for the (overall) inventory of new homes because builders are not adding to that number," Tracy said. "As long as they don't do that, then it (the inventory) should eventually come back into balance."

The same is true in Canyon County, where the number of new homes on the market has fallen from 713 on February 8 to 633 on Monday, Tracy said.

"The numbers are decreasing," Tracy said. "Not by leaps and bounds, but they are decreasing."

Wednesday, April 16, 2008

Iron Eagle Realty and Spectra Funding

Iron Eagle Realty and Spectra Funding have joined forces to offer our clients both real estate and loan services in the State of Idaho. By offering both real estate services and loan products, Iron Eagle Realty makes purchasing real estate a streamlined process. Through our partnership with Spectra Funding Inc., a mortgage banking company, we are committed to helping you find the right mortgage product for your needs. Because our partner is a mortgage banker, not a broker, we have the funds to close on your property. We understand that every borrower is different, and we offer a variety of products to meet your individual requirements. We make the process of securing a mortgage simple and straightforward by offering you the latest in financial tools that enable you to make sound financial choices. Please click here to start an online application.

Valley home sales drop 37% in first quarter, Average prices are down as inventories bulge to 12%.

First-quarter 2008 Treasure Valley single-family residential home sales plunged 37 percent from a year ago, according to industry statistics released Friday.
Experts said many homes that were sold in the last quarter of 2007 closed in the first quarter of 2008, but not enough to rescue the quarter.

"That tells you how dismal the first quarter of 2008 really was," said a real estate agent at John L. Scott Real Estate.

The Intermountain Multiple Listing Service, which tracks home sales, reported that 1,651 homes changed hands in Ada and Canyon counties from January through March, compared with 2,605 for the same period a year ago.

"I'd say that in the 14 years I've been selling real estate in the Treasure Valley, I don't think I've seen numbers as pitiful as they seem to be be," said an associate broker with Re/Max Capital City. "Things have slowed to such a crawl that a lot of Realtors, lenders and builders are not going to make it in this environment."

He knows of a couple who are both Realtors and who have just one sale between them this year. "And this is beginning to look like the new normal for now," Tracy said.
Median home prices have taken it on the chin, too.

In Ada County, the median price for a single-family home in March was $210,000, up from $205,000 in February, but down 7 percent from $224,900 in March 2007.
Canyon County's median price of $149,900 last month was down 2 percent from $152,990 in February and down 7 percent from $163,300 in March 2007.

However, median prices in both counties were still well above 2004 levels. Ada County's median price in March was 38 percent higher than the $151,881 recorded for the same month in 2004, while Canyon County's was 43 percent above the March 2004 median of $104,345.
Meanwhile, the bulging inventory of unsold homes remains a problem.

According to MLS statistics, there were 7,195 homes listed for sale in Ada and Canyon counties at the end of the first quarter, about 12 percent more than the 6,448 listings at the end of 2007.
Buyers continued to search for bargains below the $200,000 mark. Among the hot spots for sales in Ada County were the 138 sales in the Southwest Boise/Meridian area, where the median price of a home was $198,000. The Boise/Garden City area had 121 sales, with a median price of $190,000.

Scott Gray, also with Re/Max Capital City, said he is seeing more interest in Boise properties as the price of gasoline keeps rising. "It's getting a little more costly to commute to Boise," Gray said.

Another problem, he said, is that bankers have become more stringent in their lending practices, even for potential homebuyers with good credit. He speculated that as banks get back on their feet they will be more likely to start making home loans again. The second quarter will give a better indication of how the rest of 2008 will go, he said.

"There is a lot of pent-up demand out there," he said. "But people have been sitting on the fence because they were afraid that home prices would go down even further, or because they couldn't qualify."

Thursday, March 06, 2008

What is a Short Sale?

The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan(s), and turns over the proceeds of the sale to the lender in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale.

This situation can be a great deal for buyers or investors. This process can take longer than typical transactions, but the wait can be worth it.

In today's market, this situation is becoming all too common. For example, One year ago, there were less than 50 short sales marketed in the MLS (Ada and Canyon County). Now there are over 300! This means banks are beginning to competing with each other. And if you are looking to sell you home, you'll now be competing with the banks.

It is important to understand that extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market climate and the individual borrower's financial situation.

A short sale typically is executed to prevent a home foreclosure.
Often a bank will choose to allow a short sale if they believe that it will result in a smaller financial loss than foreclosing.

In short; A short sale is nothing more than negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount.

The whole process starts with a notice of default. It's filed after an owner misses a series of loan payments. This notice is filed at the county where the property is located and becomes public record.

As bad as this sounds, once that happens, investors and real estate agents spring into action in an effort to explore the opportunity. In all honesty, this is the best situation for the seller if they are unable to catch back up with the lender. It can be far better for the owner to exit the loan obligation in a short sale process then actual foreclosure. It means the seller has a chance at preserving their credit.

Micron official: Boise best place for expansion when time comes

BOISE, Idaho — A Micron Technology Inc. executive says the computer chip maker has decided that when the time is right, Boise is the best place to build a new manufacturing plant.
Company officials have no definite timeline for a new facility, but say future plans are tied to market conditions and other economic factors that would make expansion viable.

Chief Operating Officer Mark Durcan's comments about a new facility came during a briefing Monday on the company's pending joint venture with Nanya Technology Corp., a Taiwan-based company that also specializes in dynamic random access memory, or DRAM, and other advanced memory products.

Durcan said the venture will enable the companies to cooperate on research and development in the design and production of smaller, more advance memory chip technology.

The cooperative arrangement also allows Micron to lower design costs, share research and manufacturing assets and better compete in the global market, Micron spokesman Dan Francisco said. Final details of the partnership will be completed in coming months, officials said.

"Partnering with Nanya would be significant to Micron as we continue to drive toward the most cost-effective ways to grow and innovate," Durcan said in a statement. "Nanya has proven its capabilities to be a leader in manufacturing technology and is strategically located near our growing customer base."

The news is some of the most positive for a company that has struggled in the last 12 months.

The Boise-based company posted a $262 million loss for the first quarter of 2008, which ended in November. That report followed a series of decisions that led to layoffs for more than 1,000 Boise-area employees.

Company executives blame the big losses on the cyclical nature of the market and an oversupply of chips made by South Korean manufacturers eager to boost market share.

During Monday's briefing, Durcan said the company has decided that when the time is right, Boise is the best place to build a facility capable of producing the next generation of memory chips

Durcan said Boise emerged as the front-runner after an analysis that considered its proximity to existing Micron research and development offices and a series of tax incentives passed by the Legislature three years ago.

A new plant is not likely to create many new jobs, Durcan said, as much as help secure the company's existing work force in the Treasure Valley.

"There is no firm timeline," Francisco told The Associated Press. "Our entire business is dependent on market conditions. All we've done is determine that Boise is the preferred location when we decide to build another wholly owned facility."

Micron stock traded down Monday on the New York Stock Exchange to $7.17 a share, down from the previous day's $7.52.

Our View: News about plant is encouraging - as far as it goes

A new manufacturing plant would be good news for Micron Technology, and the Treasure Valley.
The plant could, at least, stabilize a local work force battered by more than 1,100 layoffs since June. The plant could help solidify the future of Idaho's largest private employer.

Monday's announcement was encouraging - as far as it went. Micron said it planned to build a new fabrication plant in Boise, but offered no timetable. The expansion was tied instead to two big variables: market health and economic conditions.

Micron offered considerable hope but scant detail. Micron told everybody what they wanted to hear - in limited amounts. And Micron left questions for every group of stakeholders:

- Employees. For the roughly 9,000 Treasure Valley workers who still have a paycheck-to-paycheck interest in Micron's future, does this news translate into some welcome stability at the Boise campus?

- Businesses. What sort of short- and long-term message should retailers and Realtors take from Monday's announcement?

- The economic development community. What does the announcement say about the future of one of Boise's corporate icons, and the viability of the state's high-tech sector?

- Political leaders. Will lawmakers finally see a return on their investment in tax incentives? In an attempt to attract just the type of plant Micron promised Monday, the 2005 Legislature provided Micron a tax break that, in 2007, exempted some $282 million of Micron's Boise facilities from the property tax.

- Investors. Micron has lost $582 million since the start of the 2007 fiscal year, with stockholders taking their share of the brunt. Is an investment in a new plant a sign that Micron expects its losses to reverse?

- Civic groups. With Micron saying it plans to invest in Boise, how will this affect philanthropic contributions to groups that have benefited from corporate and Micron Foundation support?

All of these groups have an interest in hoping the new fabrication plant becomes reality. So do we. Micron is critical to Idaho's economy and central to the Valley's culture. After months of layoffs and losses, who doesn't want to see the historically turbulent memory market rebound?

Our enthusiasm is tempered only by a disappointing shortage of details. Better days are ahead. Someday. Market willing. If you were left wanting more, that's understandable.

Absent any alternative, we're left to hold Micron to its word. Micron has publicly committed, however conditionally, to making a new investment in Boise. This is the kind of commitment Idahoans should applaud - but a commitment this company must honor.

"Our View" is the editorial position of the Idaho Statesman. It is an unsigned opinion expressing the consensus of the Statesman's editorial board. To comment on an editorial or suggest a topic, e-mail editorial@idahostatesman.com.

Newsmaker Q & A: Valley housing market strong, Realtors group president says

Dan Hernandez, the newly installed president of the Ada County Association of Realtors, says you have to earn the right to be a successful residential real estate agent. As a young man back in Los Angeles, Hernandez routinely stayed after hours making up to 50 cold calls a night. He also went door-to-door introducing himself to people, most of whom had no use for his services. There was time spent working the "For Sale By Owner" and expired listings markets, as well as various Internet lead generation systems. The hard work, and the law of averages, has paid off in a career dating back 14 years. Hernandez now heads an organization of some 4,000 Ada County Realtors who are struggling to weather the worst sales downturn in recent memory.
Q: Has the art of selling residential real estate changed?

A: The basic fundamentals have not changed, As I told you, I cold called, knocked on doors and worked the lead box. In my view, many agents came into the business for quick buck. And they have not paid their dues of developing relationships or databases that an experienced agent has. That, in my view, has a lot to do with why they have failed. They were not willing to put in the work needed to be successful. Today, the basic fundamentals have not changed. You need to go out there and meet the people. You need to put yourself in a position where you are handing out your card and saying, "Are you interested in buying a home or selling one in the near future?" Too many agents don't succeed because they sit down and wait for the phone to ring. It requires much more than that. Buyers and sellers are a lot more sophisticated than they have been. They're looking for a qualified professionals.

Q: In your 14 years, have you ever seen a market as bad as this one?

A: This is nothing. I was in Los Angeles when the market crashed in the beginning of 1990. The market almost died overnight and seemed to hit rock bottom. So this is nothing. We're in a very strong, healthy market. I'm still representing buyers that are buying homes, and I'm still selling homes.

Q: Are there any signs that we've bottomed out and are turning upward?

A: I can tell you from my personal experience as a Realtor out there on the streets that, in the last three or four weeks, I have seen more activity than I have seen in several months. Homes that had been languishing for a period of time now have multiple offers. I have spoken to other agents and asked, "Is it just me?" Their response has been no, that they have seen the uptick, too.

Q: What do you say to people who say the Treasure Valley has not seen the worst when it comes to the mortgage crisis?

A: My understanding about the subprime crisis is that more homes with those types of (adjustable) loans will reset in '08 than in '07. So I believe more homes will go into default this year than we had last year. Having said that, the January (sales) numbers showed that the median price for resale (existing homes) continued to increase, jumping almost 4 percent from January to January.

Q: But how can we be in a downturn and still see increases in median prices?

A: The January numbers showed that in Ada County sales were down 33 percent from the previous January. So people are being much more cautious. But once they get something, it holds its value. If you look at as a multiyear investment, you're going to come out ahead.

Q: But there are lot of things putting downward pressure on home prices nationwide. Whyhasn't it happened here?

A: Because Boise continues to be one of the most desirable places to live in the nation. I deal with quite a few out-of-state buyers. I'm going to have to use the C word here, but the majority are still coming in from California. The number of Californians who have been able to sell their homes has dropped off because that market is flat. But those that are successful in selling want out and are still moving here. Boise is their location of choice.

Q: Again, what about those median prices?

A: If you look at other areas, they mention having home appreciation of 35 percent or even 50 percent. We didn't have that. We went up 20 percent. But averaged over five years, we're a solid 10 percent a year. People here ask me when is the housing bubble is going to burst. My response is that there is no bubble because what we've had was steady growth that has been relatively conservative compared to what we have seen elsewhere. When appreciation rates shoot straight up, they're bound to come back down. And that's what's happening elsewhere.

Q: Was having so many outside investors here bad for the market?

A: I can't say yes and I can't say no. But I look back at the level of investors we had, and it was bad for the community. I saw many transactions where the buyers were investors who wrote and offer on new construction with the expectation that by the time the transaction closed there would already be some equity there. And when it did not reach the level that they anticipated, I saw investors bail, giving up there ernest money just to get out.

Q: Will we see investors returning to the Treasure Valley?

A: I think Californians are "flirting" with the Idaho housing market.

Q: We're seeing a lot of foreclosures locally. Won't dumping that many homes on the market depress home values even more?

A: Again, I'm looking at my own experience as a Realtor out there on the street, and not as president of the association. And as I mentioned before, I'm still selling homes - even with the high numbers of homes out there that are in default. I know many agents are working the default market and are doing quite well. Even with the number of defaults, I have not seen any change in the level of activity.

Q: How many agents has the association lost during this downturn?

A: Strangely enough, we're not seeing a lot. We budgeted for an 8 percent loss overall. But based on dues collection, it has been less than half of what we expected.

Monday, February 04, 2008

Obama wows, inspires crowd at packed arena.

'And they told me there were no Democrats in Idaho'

BY ANNA WEBB AND BRIAN MURPHY - awebb@idahostatesman.com bmurphy@idahostatesman.com
Edition Date: 02/03/08

Jaliya Cunningham might have been the youngest person in Taco Bell Arena Saturday, decades away from casting a vote and certainly indifferent to the commotion around her.
But her parents weren't going to let the 2-month-old miss what they say is history in the making.

"This is something we'll be able to tell her about when she grows up," said Shellie Cunningham Jr., Jaliya's father.

Just three days before the Idaho Democratic caucus, Sen. Barack Obama spoke to an arena-record crowd of 14,169 people - almost triple the nearly 5,000 Democrats who caucused statewide in 2004.

"And they told me there were no Democrats in Idaho," Obama said at the beginning of his 45-minute speech.

The crowd validated Obama's decision to visit Republican-dominated Idaho before the all-important Super Tuesday. Democrats in 22 states will decide between Obama, from Illinois, and New York Sen. Hilary Clinton.

Obama's upbeat speech validated the decision many made to wake before dawn and line up in frigid temperatures to get a seat or stand in the aisles.

"There's something about him, something about what he has to say that people want to hear," said Steve Lolar, a 38-year-old Boise State student.

People gave many reasons for coming to Taco Bell Arena - to be part of Obama's history-making run for president; to make up their minds before Tuesday's caucus; or to catch a glimpse of a candidate frequently described as a "rock star."

Even after arena officials opened more seating, they had to turn several thousand more people away.

"I've lived in Idaho nearly 32 years, and this is the first chance I've had to see a presidential candidate, especially a Democrat," said Andrea Leevs, a Boise social worker.

Hand-painted banners hung from every seating level. Tubas from the Borah High School band glinted. Introduced by former Gov. Cecil Andrus, Obama took the stage to a long, loud ovation, flashed his now-familiar smile and thanked his local supporters for their work.

The speech held no surprises - except, perhaps, for Obama equating his long-shot status to that of the Boise State football team.

"It's fun being an underdog," said Obama. He leads Clinton in Idaho but is running closely behind her in most polls.

Obama offered a general call for national change and hope and laid out specific proposals on the economy and energy policy.

He touted the need for improved health care and educational systems. He called this a "defining moment in history" when the country needs to pay attention to a planet in environmental peril, find a way to exit the Iraq War, and support teachers and veterans.

The themes are Obama stump-speech standards, but they repeatedly brought the Boise crowd to its feet.

"The war is my main concern," said Shellie Cunningham. "Our brothers and sisters are dying daily. Why?"

Francine Gonzalez also wanted to hear Obama's thoughts on the war.

"I have young sons," said Gonzalez.

She's undecided but glad Obama visited the state.

"Usually, they don't come here, or if they do, it is for a fundraiser that costs $250 a ticket." she said. "It's not an opportunity for everyday people."

Marsha Meredith of Boise has never been involved with politics before, but Obama's speech made her cry.

"I'm so happy right now," she said. "Everything he said about supporting teachers, and schools, the environment, I've been waiting so many years for this and have had nowhere to go."

Clearly aware he was speaking in one of the reddest states in the union, Obama briefly touched on his Christian faith and support for the rights of gun owners, notably hunters.

The Clinton campaign questioned his consistency on gun ownership, and the Republican National Committee rebuked Obama for his positions on guns and foreign policy.

"As if his newly minted title of 'most liberal' senator was not enough, Barack Obama has enlisted the help of Ted Kennedy to advocate proposals that are out of touch with mainstream values," said Paul Lindsay, a regional press secretary for the RNC.

Obama said he has tried to reach out to conservatives and Republicans, citing his ability to work across party lines.

"We can disagree without being disagreeable," he said.

Ron Fortner, a history teacher at Caldwell High, first voted Republican in the 1960s, but got to the arena at 5:15 a.m. to see Obama.

"I was a Nixon man then. This year, I'm wide open," he said. "It's not often you get to see history."

Tuesday, January 29, 2008

Home foreclosure rate soars in 2007

By ALEX VEIGA - AP Business Writer
Edition Date: 01/29/08

LOS ANGELES — The number of U.S. homes that slipped into some stage of foreclosure in 2007 was 79 percent higher than in the previous year, a real estate tracking company said Tuesday. Many homeowners started to fall behind on mortgage payments in the last three months, setting the stage for more foreclosures this year.
About 1.3 million homes received foreclosure-related warnings last year, up from 717,522 in 2006, Irvine-based RealtyTrac Inc. said. Foreclosure filings rose 75 percent from the previous year to 2.2 million.

More than 1 percent of all U.S. households were in some phase of the foreclosure process last year, up from about half a percent in 2006, RealtyTrac said.

Nevada, Florida, Michigan and California posted the highest foreclosure rates, the company said.

The filings included notices warning owners that they were in default, or that their home was slated for auction or for repossession by a bank. Some properties may have received more than one notice if the owners had multiple mortgages.

A late-year surge in the number of properties reporting foreclosure filings suggests that many are in the initial stages of the foreclosure process and could end up lost to foreclosure this year unless lenders or the government steps in, RealtyTrac said.

"It does appear that we're seeing a new batch of properties enter the process," said Rick Sharga, RealtyTrac's vice president of marketing.

RealtyTrac is forecasting that the pace of foreclosure filings will remain steady, rather than accelerate during the first half of 2008.

"Assuming nothing else bad happens economically ... we will have exhausted the bulk of the worst-performing loans by the end of June," Sharga said, referring to adjustable-rate mortgage loans made to borrowers with poor credit.

Many of these subprime loans defaulted last year, triggering a credit crisis and saddling major financial institutions with losses.

More than 1.8 million subprime mortgages are scheduled to reset to higher interest rates this year and next.

Last year's explosion in foreclosure activity came amid a worsening housing downturn, as falling home values ate into homeowners' equity, making it harder for many to refinance into more affordable loans or to find buyers. Those options had helped keep troubled homeowners from sliding into foreclosure.

"We went from a sort of buying frenzy to a foreclosure frenzy in the last two years," Sharga said.

Recent efforts by government and mortgage lenders to help homeowners at risk of falling seriously behind on mortgage payments have had a marginal impact on the U.S. foreclosure rate so far, Sharga added.

In December alone, foreclosure filings soared 97 percent from the same month a year earlier to 215,749. It was the fifth consecutive month in which foreclosure filings topped more than 200,000, RealtyTrac said.

In the fourth quarter, filings rose 86 percent from the prior-year quarter but only 1 percent from the third quarter.

Nevada had the highest foreclosure rate in the nation last year, with 3.4 percent of its households receiving foreclosure filings. That was more than three times the national average, RealtyTrac said.

The state had 66,316 filings on 34,417 properties in 2007, up more than 200 percent from 2006's total.

Florida had more than 2 percent of its properties in some stage of foreclosure last year. The state reported 279,325 filings on 165,291 homes, more than twice the previous year's total.

In Michigan, where job losses are pressuring many homeowners, 1.9 percent of all households received a foreclosure filing last year. In all, 136,205 filings were issued on 87,210 properties, up 68 percent versus filings in 2006.

California led the nation in total foreclosure filings and the number of homes in some stage of foreclosure last year.

A total of 481,392 filings were issued on 249,513 properties, more than triple the number of filings in 2006, RealtyTrac said.

In all, 1.9 percent of households in California received foreclosure filings.

Many of the homes receiving foreclosure filings in the state were in the inland markets, where new construction and more affordable prices helped fuel a spike in sales toward the end of the housing boom.

Other states in the 2007 foreclusure top 10 were Colorado, Ohio, Georgia, Arizona, Illinois and Indiana.

Boise, Nampa make list of 100 best cities for kids

Edition Date: 01/27/08

Boise has been named one of the 2008 100 Best Communities for Young People from the America's Promise Alliance, a national alliance dedicated to children and youth.
Nampa also won the award, which recognizes communities considered to be the best places for young people to grow up. More than 300 communities in 50 states applied.

Some of the youth-oriented programs listed in the report include the Mayor's Council on Children and Youth, which created an online network of after-school sites at www.after3boise.org, and construction of three new community centers to provide neighborhood-based programs for kids at schools.

For more details about the 100 Best competition, please visit www.americaspromise.org.

Why does one home sell while another doesn't?

Realistic pricing is the key in a sluggish market, experts say, and location helps, but some sellers are caught in a mortgage bind


Owners: Jesse and Christine Testa

Address: 7204 W. Tobi Court

City: Boise

Square feet: 1,500

Number of bedrooms: 3

Sale price: $214,000

Neighborhood: Palisades Addition

Time on market: 5 days

Owners: Doug and Becky Langford

Address: 95 W. Rockford St.

City: Meridian

Square feet: 1,762

Asking price: $209,000

Number of bedrooms: 3

Neighborhood: Meridian Heights

Time on market: Since February 2007

BY JOE ESTRELLA - jrestrella@idahostatesman.com
Edition Date: 01/25/08

This is the tale of two Treasure Valley homes.
One sold five days after being listed. One has languished on the market since February 2007.

It is also a story of how over-priced homes that often sold in a day during the 2005-06 housing boom are now a drag on a single-family residential home market. And it is a story about what homeowners must endure in a down market.

The stories have a moral: Price your home realistically, and it will sell.

These two homes are part of a market that was still flooded with 6,448 homes for sale at the end of 2007, though that's 1,425 homes fewer than last summer.

The one that sold within days of its listing is a 1,500-square foot, two-story, three-bedroom home at 7204 W. Tobi Court in Northwest Boise. Owners Jesse, 31, and Christine Testa, 27, listed the home the day after Thanksgiving. By the following Tuesday, they had a buyer. Sales documents were being prepared, and earnest money had changed hands.

Jesse Testa credits the quick sale to improvements like the hardwood floors he put in on the second floor. But he also credits the couple's real estate agent, Horace Smith of HMS Realty, who had been preaching that the days of selling a home in a single day were gone, replaced by a slumping market where properties must be be priced realistically.

That advice means an owner today often has to settle for less.

"Price is very important," said Smith, who has been selling real estate since 1970. "If you can get people to do the right thing (price-wise), then they have an excellent chance of selling. If not, it's just going to sit there."

Built in 2002, the Testas' home was a narrow, two-story row house near Gary and State streets. Its attractions include wood floors in the kitchen and dining area, crown molding throughout, 9-foot ceilings and stairs carpeted down the middle with white painted wood on either side.

It was also just 15 minutes away from Boise State University, where Jesse Testa is taking business courses in hopes of moving into management at Motive Power, a Boise-based manufacturer of locomotive engines where he works as a welder. His wife is a nurse at St. Luke's Regional Medical Center in Downtown Boise. They bought the home during the housing boom for just over $150,000.

When it came time to sell, they priced their house at $214,000, which was $8,000 below its assessed value. The home immediately caught the attention of a family of four that had been living in a rental home. "I knew they had bought the house the first time they saw it," Testa said. The Testas got their asking price.

He said some residents have not accepted the realities of the current Treasure Valley single-family home market.

"We just wanted to sell our home. There was no reason to be super-greedy," Testa said,

The couple now live in a $275,000, three-bedroom, 1,800-square-foot home in Eagle, where Jesse Testa has more garage space for his collection of motorcycles.

It hasn't been nearly as easy for Doug and Becky Langford, who have had their home at 95 W. Rockford St. in the Meridian Heights subdivision on the market for almost a year. The subdivision sits just off Meridian Road near Victory Road.

Doug Langford, a financial adviser with Beneficial Financial Group, admits their first mistake was wasting the first six months trying to sell their 1,762-square-foot, ranch-style home themselves.

The couple, who have since moved to Ogden, Utah, are still making mortgage payments on the property. It has not received a single offer, despite the Langfords' decision to slash the original $220,000 price to $209,000, he said.

"And there's a good chance that we're going to cut the price again," Langford said.

Meanwhile, the couple, who are expecting their first child, are renting a basement apartment while they wait for their home to sell.

But at $209,000, the house is still priced well above its assessed value of $185,000, according to the Ada County assessor's office.

Phil Hoover, an associate broker with Re/Max West who has been in the business for 35 years - including the last seven in the Treasure Valley - insists there is rarely any correlation between the seller's asking price and the 2007 assessed value. He is not the Langfords' real estate agent.

Don McFarland, another broker with Re/Max West, says a home priced below its assessed value "is going to get my attention," but argues there are many reasons why a home may be priced lower than its assessment, including poor condition, a poor location, difficulty showing a rental house because a tenant is not cooperating, or pet damage.

Ada County Assessor Bob McQuade isn't so sure. "We may have under-valued the home by $10,000," he said. "But if it's been sitting there that long, chances are we valued it right."

Langford said his real estate agent has been after the couple to drop their price to $205,000.

"He said that if we'd drop it to $200,000 it would probably sell tomorrow," Langford said.

Shaun Tracy, an associate broker with Re/Max Capital City who tracks the local market, said there could be a litany of reasons why the Langfords' home has failed to sell.

Originally, the subdivision faced a junkyard, which "got it off on the wrong foot," he said. And part of the subdivision backs up to Kuna/Meridian Road, while another part sits adjacent to a mobile home park.

At 1,762 square feet, the Langfords' home is one of the larger ones in the subdivision. That may hurt its sale prospects, too.

"People like to buy homes next to the larger homes because it makes their values go up," Tracy said. "You always want to be the small fish in the big pond."

Finally, Tracy said, the highest price for a home in Meridian Heights in 2007 was $219,000, the lowest $149,900.

"He (Langford) needs to be at about $199,900," Tracy said.

But Langford said selling the house will not end his problems.

He said the couple owe $225,000 on the home. They purchased it using an 80/20 financing plan that amounts to two mortgages, one for 80 percent of the home's value, one for 20 percent.

It is a financial mechanism designed for buyers who don't want to pay mortgage insurance or have much of a down payment. But if a buyer defaults, he is on the hook for two mortgages, not one.

So, if the Langfords sell for $200,000, they will still need to take out a $25,000 loan to pay off the second mortgage.

"That's why I listed it at the price I did," Langford said. "I didn't want to take out a $25,000 loan, and get nothing for it."

Area real estate agents say commercial vacancies not dire

BY COLLEEN LAMAY - clamay@idahostatesman.com
Edition Date: 01/20/08

Commercial development remains a bright spot in the Treasure Valley economy, especially when you compare it to ghost neighborhoods of unsold homes dotting the Valley.
To be sure, high-profile vacancies suggest the possibility of an overbuilt market. The new Gateway Center shopping center in Nampa is mostly empty, with only a J.C. Penney anchor store open. And the pace of new construction and commercial rentals is beginning to slow - at least in Boise - from the go-go pace of the past few years.

But commercial real estate agents aren't worried. 2008 promises more new stores, offices and industrial space, they said.

"Anybody in my business will tell you that Canyon County is the hot spot, and we believe that 2008 will be more of the same," said Jerry Gunstream of Gunstream Commercial Real Estate in Nampa.

George Iliff of Colliers International in Boise, which sells, leases and manages commercial properties, sees a slowdown, but not enough to worry about.

"I think tenant interest is a little slower than it's been in the past, but still is not at a standstill," he said. "Everybody is talking about how horrible it is, and it's not. People are going about their business somewhat as usual."


In Boise, developers' applications for new buildings appear to be dropping, said Jenifer Gilliland, building division manager for the city. But the market for the past few years had been red-hot, Gilliland said.

"It's certainly slower than it was last year, but as far as it relates to our department, it is slowing down to a more normal level of construction," she said.

"We'll know a lot more in March or April, because that is when a natural slowdown always occurs," she said. "If we start really tanking in March or April, then we start to get concerned."

The mall along busy Milwaukee Street where the consumer-electronics store CompUSA is closing has some empty storefronts, as do older strip malls at Cole and Ustick roads and the Hillcrest Shopping Center on Overland Road. But retailers are mall rats these days. Borders bookstore recently moved from its spot near CompUSA into Boise Towne Square mall.

"There is a lot of growth and continued interest in the mall in terms of expansion and so forth, so I think CompUSA is maybe a casualty of retailing strategy (rather) than an indication that retail is in trouble," Iliff said.

Office space also is doing all right, he said. Emerald Street near the mall once had quite a few buildings standing empty, with a vacancy rate of 12 to 13 percent. Now, it is 7 percent to 8 percent higher than Downtown Boise, but lower than vacancy rates further west, he said.

Big projects planned in Boise include a for-profit hospital along Fairview Avenue and a WinCo grocery distribution center off Interstate 84 near Micron's main plant.

"We are hoping those will (help) keep our boat afloat," Gilliland said.


Meridian's office vacancy rate is in the double digits - 13 percent - a result of rapid building as the population has grown.

Gauging vacancy rates in Eagle is misleading because the market is so small, Iliff said. One or two empty buildings will drive the numbers up. Right now, it is probably about 20 percent because of a few large empty buildings.

"It's still not in bad shape," Iliff said.

A key factor on the east side of the Valley is that not much new commercial space is being built right now. That's good because it gives the market time to get in sync with tenants' needs to lease, he said.

For home sales, that will take more time because the Valley ended up with many more homes than buyers.


In Nampa, Jerry Gunstream said his company does about 75 to 80 percent of the commercial work, "so we have a good pulse on the market."

Retail growth in Nampa has been huge in the past year, he said. The city grew without national developers realizing it existed. But "in the past two to three years, it suddenly has been discovered," he said.

Perhaps the biggest commercial growth in the entire Valley in 2007 was the 750,000-square-foot Treasure Valley Marketplace, along I-84 at the Karcher Road interchange in Nampa. It has a Costco, Target, Old Navy, Olive Garden and other stores and restaurants. More are coming, including a T.G.I. Friday's, probably within a few weeks.

"Almost everything in that project that's been built has been occupied," Gunstream said.

Karcher Mall, which never recovered after Boise Towne Square opened, is another story. But things are looking up, Gunstream said. A year ago, the vacancy rate was 40 percent, and now it is 20 percent, he said.

The Nampa Gateway Center, on the south side of the Interstate near the Idaho Center, probably is the most stressed of the retail developments in the Nampa area, Gunstream said.

The developer -DDR, or Developers Diversified Realty Corp., based in Ohio - has built 170,000 square feet of retail space that is vacant.

"It is the largest amount of vacant space anywhere within the county," he said.

"It is the one area that seems to be suffering the most, but the developer is a national developer, and they typically know what they are doing," Gunstream said.

The same developers are behind the successful Meridian Crossroads development at the corner of Eagle Road and Fairview Avenue. Company representatives could not be reached Thursday or Friday.

Wednesday, January 23, 2008

Idaho foreclosures have more than doubled over last year

Idaho's housing foreclosure numbers have already more than doubled the total for all of last year, with December's figures yet to be tallied, according to a report released Wednesday.
RealtyTrac, an Irvine-California-based Web site that monitors foreclosures nationwide, reported that there had been 5,338 filings in Idaho at the end of November, or 113 percent more than the 2,508 foreclosures recorded for all of 2006. Year-over-year the percentage increase is 187 percent, said RealtyTrac spokesman Daren Bloomquist.

November's 667 filings were 11 percent above the previous month. Ada and Canyon counties accounted for 393 filings or 59 percent.

Industry reaction to the news was mixed. One expert argued that the growing number of foreclosures would drive down housing prices enough to allow more people to purchase homes, while another countered that people losing their homes won't be in the market to buy another one right away.

Shaun Tracy, an associate broker with Re/Max Capital City., said that the spike in foreclosures might be just the medicine needed to cure the state's ailing single-family residential housing market.

Tracy believes that as desperate homeowners slash their asking price housing affordability will return to the Treasure Valley, where the housing boom of 2005 and 2006 priced many area residents out of the market.

According to the Intermountain Multiple Listing Service, the median price of an Ada County home has risen 43 percent since 2004, or from $169,900 to $232,900 at the end of 2006. Canyon County's median prices went from $107,0000 to $161,900, or an increase of 51 percent for the same two-year period.

"It (the rise in foreclosures) might help re-establish where the market needs to be in order to stimulate sales," Tracy said.

The 667 Idaho foreclosure numbers for November represented one filing for each 893 homes in Idaho. That was still better, however, than the 201,950 U.S. foreclosures last month that amounted to one filing for every 617 homes in the country.

Marc Lebowitz, chief executive of the Ada County Association of Realtors, wasn't convinced that higher foreclosure numbers would translate into higher housing sales.

"Usually, when a person sells a house they buy another one," he said. "But some of these people are going to be forced into the rental market, at least for a while."

Most industry watchers blame sub-prime mortgages made by lenders to consumers with shaky credit histories as the primary reason U.S. foreclosures are on a record pace. The loans initially offer a low "teaser rate." That rate jumps dramatically, however, when the interest on the loan resets, often leaving the homeowner unable to keep up with the new monthly payment.

Meridian-based homebuilder Don Hubble, of Hubble Homes, said there could be more trouble for the housing market if banks begin repossessing homes then sell them at bargain-basement prices, which would drive down housing values throughout the Valley.

Meanwhile, industry sales numbers reveal that the huge inventory of homes hanging over the Treasure Valley housing market and depressing sales continue to decline.

IMLS figures show that the inventory of homes in Ada County has fallen for the fourth straight month -from 5,192 in August to 4,587 in November - a decline of 12 percent.

Canyon County saw a 10 percent drop in its housing inventory for the same period, from 2,697 in August to 2,437 last month.

Foreclosure Auctions - Boise, Idaho

Fellow Investors:

As you can see from the previous article that foreclosures are on the rise across the country as well as in Southwest Idaho. This situation presents an incredible buying opportunity over the next 12 to 18 months. More and more properties will come up for auction. The Treasure Valley (Boise, Meridian, etc.) remains a great place to live, work and play. We are still enjoying a solid influx of people moving to our area just for those reasons. The economy is healthy and the rental market is strong as we move through the winter and into the spring.

For your benefit, I am starting a weekly email outlining properties that are coming up for auction in the following week. Bidding at the foreclosure auction is tricky but can be very rewarding. If you are interested in receiving this weekly email, please email me a request at Michael.Hon@IronEagleRE.com. I look forward to building your wealth.

Michael Hon
Iron Eagle Realty

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