Submitted by Anonymous on Mon, 07/30/2007 - 05:00.
High percentage of investor-owned properties inflated housing prices in Baltimore
  Legally
restore your credit Get
rid of your debt Business debt
restructuring Build corporate
cash credit Sell
your note for quick cash Get
access to private money |
“Real estate investors, leaping to buy Baltimore homes during the boom, helped fuel the frenzy and drive up prices in neighborhoods from Canton to Reservoir Hill. Now they’re part of the fallout.”
“Properties belonging to ‘nonowner occupiers,’ usually investors, accounted for nearly 30 percent of the city homes that lenders were trying to foreclose on during the first three months of the year, according to a Sun analysis.”
“In popular Canton, for instance, investor-owned real estate added up to more than half the 25 homes on the court foreclosure-filing rolls.”
“‘Some people just got left holding the bag,’ said T. Guy Cook… whose niche is lending to Baltimore real estate investors. ‘It was inevitable. You knew it was going to happen - it’s like musical chairs.’”
“The rising tide of foreclosures has swept up investors both novice and experienced, though it appears that the newcomers are far more numerous. They were ‘the most giddy of all,’ jumping in too late and paying too much, Cook said.”
“‘It’s been a nightmare,’ said Ndabezinhle Moyo, a Baltimore resident who began investing last year in several city neighborhoods. After a series of setbacks, he’s fighting to save four of his rentals - plus his own home - from foreclosure. ‘I was OK up until December. From December, I basically couldn’t make a single payment for anything till about April.’”
“Investors who descended on certain areas to buy, buy, buy during the housing boom helped drive prices up even further at the time, said Mark Fleming, chief economist with a firm that helps the mortgage-lending industry manage risk and fraud.”
“‘They artificially inflated values, in essence, because of their interest in bidding it up to get it away from the other investor,’ he said. ‘If you have concentrated investors in certain areas and then house prices start to move south or sideways, the ramification is their greater willingness to walk.’”
“A California mortgage fraud detection company, said just over 30 percent of the Baltimore loan applications it looked at in the first five months of the year had possible ‘property valuation’ problems, often inflated values. That compares with 8 percent nationwide.”
“‘A lot of people [who] got in, put a lot of money into fixing up houses and have loans, can’t sell them, they can’t rent them for enough to cover mortgages, and they’re stuck,’ said Alan Chantker, president of the Mid-Atlantic Real Estate Investors Association. ‘They may have thought they were going to be in and out of the home in six months, nine months - and then it turns into a year, a year and a half.’”
“Nobody expected the collapse of two New York hedge funds investing in subprime mortgages to kick up dust in Baltimore. Nobody expected a bunch of First Mariner’s mortgages in Northern Virginia to go bad less than three months after they were issued.” “‘I’ve never had anything like this happen to me,’ First Mariner CEO Edwin F. Hale Sr. said last week.” “Until very recently, economic optimists had comforted themselves with the notion that housing problems were ‘contained.’ Things would pick up in the spring home-buying season, people figured. But there was no season, it is now apparent.”
“The salve of federal money that has protected the Baltimore-Washington region from economic pain is losing its effectiveness. Half of First Mariner’s problem loans were in Northern Virginia, home of a defense-spending spree since 2001.”
“Hale thinks some of the mortgages may have been issued to ‘flippers’ seeking a quick buck, violating contract terms requiring the money to be applied to a primary residence. Even so, the delinquencies don’t speak well of the Northern Virginia economy or, by implication, Maryland’s, which has been operating in the same federal bubble.”
Source: baltimoresun.com
“Properties belonging to ‘nonowner occupiers,’ usually investors, accounted for nearly 30 percent of the city homes that lenders were trying to foreclose on during the first three months of the year, according to a Sun analysis.”
“In popular Canton, for instance, investor-owned real estate added up to more than half the 25 homes on the court foreclosure-filing rolls.”
“‘Some people just got left holding the bag,’ said T. Guy Cook… whose niche is lending to Baltimore real estate investors. ‘It was inevitable. You knew it was going to happen - it’s like musical chairs.’”
“The rising tide of foreclosures has swept up investors both novice and experienced, though it appears that the newcomers are far more numerous. They were ‘the most giddy of all,’ jumping in too late and paying too much, Cook said.”
“‘It’s been a nightmare,’ said Ndabezinhle Moyo, a Baltimore resident who began investing last year in several city neighborhoods. After a series of setbacks, he’s fighting to save four of his rentals - plus his own home - from foreclosure. ‘I was OK up until December. From December, I basically couldn’t make a single payment for anything till about April.’”
“Investors who descended on certain areas to buy, buy, buy during the housing boom helped drive prices up even further at the time, said Mark Fleming, chief economist with a firm that helps the mortgage-lending industry manage risk and fraud.”
“‘They artificially inflated values, in essence, because of their interest in bidding it up to get it away from the other investor,’ he said. ‘If you have concentrated investors in certain areas and then house prices start to move south or sideways, the ramification is their greater willingness to walk.’”
“A California mortgage fraud detection company, said just over 30 percent of the Baltimore loan applications it looked at in the first five months of the year had possible ‘property valuation’ problems, often inflated values. That compares with 8 percent nationwide.”
“‘A lot of people [who] got in, put a lot of money into fixing up houses and have loans, can’t sell them, they can’t rent them for enough to cover mortgages, and they’re stuck,’ said Alan Chantker, president of the Mid-Atlantic Real Estate Investors Association. ‘They may have thought they were going to be in and out of the home in six months, nine months - and then it turns into a year, a year and a half.’”
“Nobody expected the collapse of two New York hedge funds investing in subprime mortgages to kick up dust in Baltimore. Nobody expected a bunch of First Mariner’s mortgages in Northern Virginia to go bad less than three months after they were issued.” “‘I’ve never had anything like this happen to me,’ First Mariner CEO Edwin F. Hale Sr. said last week.” “Until very recently, economic optimists had comforted themselves with the notion that housing problems were ‘contained.’ Things would pick up in the spring home-buying season, people figured. But there was no season, it is now apparent.”
“The salve of federal money that has protected the Baltimore-Washington region from economic pain is losing its effectiveness. Half of First Mariner’s problem loans were in Northern Virginia, home of a defense-spending spree since 2001.”
“Hale thinks some of the mortgages may have been issued to ‘flippers’ seeking a quick buck, violating contract terms requiring the money to be applied to a primary residence. Even so, the delinquencies don’t speak well of the Northern Virginia economy or, by implication, Maryland’s, which has been operating in the same federal bubble.”
Source: baltimoresun.com
1
