A Glance at REOs Southwest.(Managing REO: Continuous Growth Still Consistent)

Byline: Matt Hudson

The most popular thing being said during any interview on a major media business outlet currently is that the United States has seen a boom in the number of foreclosures that are flooding into the local real estate markets. While this is definitely true, one might be better served to look more closely at this issue to understand it better and to comprehend both the effect on the local homeowner and the REO industry as a whole. With the rise in foreclosures, we will see the unintended growth of the REO and REO management industries. As the old adage goes that "all politics is local," I would say that all real estate is local, which is why the local markets nationwide are disappointing so many homeowners looking to sell their properties at this time. Like many other areas of the United States, the Southwest region has seen unprecedented changes in the recent few years. These changes can be seen in many ways, all of which are directly affecting the way in which REOs are currently being managed there.

REO in Arizona is a growing industry with many new members who are doing a great job for the most part. I am proud to be doing a good deal of work with a group of REO brokers that are on top of their game. Recently, there have been some changes with the way in which REOs are managed that have significantly impacted the REO industry. For example, the rise in the number of stolen HVAC and air-conditioning units has been staggering. While I do not believe that the industry yet keeps statistics on this particular item, I can say anecdotally that I have seen growth in the 90%-200% range in the last three fiscal quarters. It seems that the item of choice to steal by local vandals is these units. Meanwhile, field service companies and REO brokers are tasked with the responsibility to outwit the vandals in this arena. Generally speaking, I believe that the industry is doing a good job but could stand to improve. I can see very new, innovative ideas on securitizations of these units anytime that I am in Arizona or viewing feedback photos gathered by the agents that are partnering with me to sell the portfolio I work on. Other than the rise in theft of HVAC and air-conditioning units, there have been other changes locally also. For example, a significant amount of new expenses are being billed to REO investors from local HOAs. It seems that the HOA community of Greater Phoenix has decided that they have the ability to invoice for a very broad array of charges that did not exist even three years ago. Code ...