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Market Updates

News: Drooling Hedge Funds, a New Foreclosure Tax and FHA Says "Flip Away"

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(NOTE: Want to learn how to flip houses to hedge funds? Click here for our “Partnering With Hedge Funds” special report.)

real estate mogul newsSo have you noticed what's going on around us in the real estate world lately?

Well let’s see, for starters, last week the temporary waiver of FHA's 90-day "anti-flipping" rule was extended through 2014. (See “FHA says flip away…” below)

The original “Anti-Flipping Rule” (enacted in 2003) was aimed at curbing the FHA’s oddball definition of “Property Flipping,” in which “a property recently acquired is resold for a considerable profit with an artificially inflated value, often as the result of a lender’s collusion with an appraiser.”

That’s not how me and my friends flip, but anways…

This was basically the FHA refusing to insure a mortgage if the seller had purchased the home within 90 days -- this impacting a real estate investor's ability to sell their rehabbed houses quickly to anyone using an FHA loan, which is a pretty decent chunk of the first time buyer pool.

In 2010 the FHA decided to suspend this rule, admitting it was a standing in the way of allowing investors to help improve a limping economy. Staying the rule allowed legitimate property flippers to once again help move the excess inventory of homes off the market, and move qualified FHA buyers into those homes -- which only makes good sense.

Last year the FHA re-upped this "flipping waiver", and now they've done it again. Except this time, it's renewed for 2 years. Yay.

In other news...

  • The mortgage lending industry just attempted to take a pretty laughable/jerky victory lap (see “Lack of a Foreclosure Wave Determined By Banks”) 
  • yucky “foreclosure tax” may be looming in 2013 (see “PolitiFact: A foreclosure ‘cliff’ could be looming”)
  • And a fiscal battle over the mortgage deduction is at hand (see “U.S. housing industry warns against mortgage interest tax deduction”)
  • Oh, and if you’re looking for a little industry validation on the huge interest from hedge funds, private equity groups and even Pension funds who are now drooling over the booming REO market, look no further than “Money floods to IMN REO-to-rental conference” and "Valuation Companies Team Up, Offer REO-to-Rental Service" below.

Now that you’ve been adequately teased, here’s the latest array of relevant, timely and noteworthy industry news that's hit our radar in the last couple of weeks or so.

Recommend investing a few minutes to take it in, and consider how these things may be impacting your own business and your bottom line.


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