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Altos Research: Distressed Residential Overview

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Altos Research: Distressed Residential Overview

  1. 1. Altos ResearchOpal Real Estate Investors Summit:Dealmakers ConferenceApril 2011Miami, FLPresented by: Scott Sambucci
  2. 2. Analyzing Mortgage Portfolios Pre-Bid Diligence Servicing Liquidation• Do we want • Is the • Work-out? • Price vs. exposure in market Foreclose? time these local tanking? • Mark-to- • Maximize markets? Improving? market returns• Which of • Diamonds • Portfolio • Leaving these in the rough analysis money on properties • Rotten • Loss Mit the table? are for sale? apples • Loss Severity• Risk • BPO adjusted analysis quality
  3. 3. Finding distressed opportunities• Dependent on acquisition, servicing, holding, disposition strategy• Local matters within the macro- environment – i.e. Silicon Valley vs Fremont – i.e. Buckhead vs. Lilburn• Slice sub-markets into price zones – i.e. rehab vs. as-is – workout vs. foreclosure
  4. 4. Geo-local Analysis• Leading: List Price, Price of New Listings• Demand: Percent of Properties with Price Reductions• Psychological: Percent of Properties Relisted, cumulative days on market• Supply: Population per inventory
  5. 5. Buckhead
  6. 6. But SLOWER
  7. 7. Price Analysis with sub-marketsBoise, ID83702Los Altos,CA94022
  8. 8. Signals for work-out opps Short sale attempt initiated (3/10) Asking price reduced, (8/10) Short sale fails (10/11) Bank re-sells at ~60% of initial ask (3/11)
  9. 9. AFFORDABILITY ANDCOMPETITION
  10. 10. Atlantaovercorrecting
  11. 11. VegasWaterfall
  12. 12. Price-to-inventory SensitivityAnalysis: Las Vegas MSA
  13. 13. Los Altos, CA vs Davis, CA
  14. 14. Altos Research:Real-Time Housing Market Analytics• Altos Research is the premier vendor of real-time analytics for housing market and asset valuation – What’s for sale? – How much is the property worth? – How’s the market?• The only national source of primary data in the active housing market with applications specifically developed for mortgage analysis• 20,000+ zip codes / 200+ MSAs
  15. 15. Active Market Signals Future TransactionPrice Home listed $429,000 Buyer financing fails, Inventory 49 Neighbor home Property relisted listed $394,000 $409,000 Deal closed $389,000 Price reduced $398,000 Inventory 69 Transaction Offer made Recorded $391,000 March May July Sept Nov Jan Closed transaction = 1 data point, months too late Active Market = 9 months of pricing, price changes, supply and demand, leading indicators
  16. 16. From Last Year’s Home Price Presentation
  17. 17. AltosEvaluate™Mortgage Analytics Suite• AltosEvaluate Web Application – Analysis of each property in portfolio – Web application and market reports• Forward Valuation Modeling™ – 3, 6, and 12 month geo-local forecasts – By zip, property type, and price range• Active Market Analytics™ data files – Local market trend statistics and leading indicators – Published weekly by zip code. 20,000 zip codes – CSV data files for import into housing models• Listing Intel™ data files – Details on 2 million+ homes listed for sale this week – Active market comparables for pricing, supply, and fraud detection – Property forensics – Listing History, Listing Match, Listing Comps – CSV data files for import into property analysis systems
  18. 18. Valuation: Past, Present, Future Geo-local Machine learning Altos Forward Valuation Modeling™ 2011Today’s Market Conditions Altos Real-Time Analytics™ & 2007 (Friday’s data) Listing Intel ™ Repeat sales models HPI – use Case Shiller et al, to estimate c. 2005 “current” valuations Linear regressions AVM – automated, transactions still lagging c. 1998 People BPO – manual, expensive, quickerBackward looking Traditionallagging People Appraisal – manual, slow, expensive, old
  19. 19. ContactScott Sambucci, Market AnalyticsAltos Researcho: (415) 931-7942c: (415) 596-0804e: scott@altosresearch.com Bloomberg: ALTO

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