Archive for the 'Real Estate News' Category

What Will the First Anniversary of the Credit Crunch Mean to Sacramento?

August 4th, 2008 Categories: Real Estate News, Real Estate Trends, Sacramento Home Buyers, Sacramento Real Estate

In some ways, I can’t believe it’s already been a year… But in other ways it seems like this market is just the ‘new normal’, and its been like this forever…

Ben bernenke said just over a year ago that “Troubles in the subprime sector seem unlikely to seriously spill over to the broader economy or the financial system”.

Wonder what he has to say about that now; with the Dow Jones down almost 15%, economic growth down more than 50% and eight major U.S. banks along with thousands of employees now gone.

Michael Burry,head of Silicon Valleys Scion Capital’s says “I doubt we’re even a third of the way through it,”see full story.

Add the financial woes of the California State Budget , four dollar a gallon gas… the future seems a little scary…

I’ve done some numbers crunching and it seems that the Sacramento area housing inventory of homes for sale over the $350,000 mark is now growing. Demand for the lower prices up to around $350,000 is still running neck and neck with supply.

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Mortgage rates headed up… Sacramento buyers: Hurry!

June 30th, 2008 Categories: Mortgage and Loans, Real Estate News, Real Estate Trends, Sacramento Home Buyers, Sacramento Sellers

Asset managers and Homeowners have finally dropped prices enough to stimulate buyers interest here in the Sacramento area. But in order to do it, median price of an existing, single-family home in Greater Sacramento declined to $233,230 in May, a 34.5 percent fall from a year earlier. The California Association of Realtors reported a 18.1 percent increase in sales last month.

For the first time in 30 months we had a year over year increase in number of homes sold.

Now or newest alarm is on mortgage rates… As if we needed more to challenge our housing market.

Bloomberg says:Homes Less Affordable as Prices Fall, Rates Rise.

We all knew it would happen sometime…

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The Worse Housing Bust since World War II?

May 26th, 2008 Categories: Mortgage and Loans, Pre Foreclosures, Real Estate News, Real Estate Trends, Sacramento History, Sacramento RE Stats, Sacramento Real Estate, Sacramento Sellers, Shortsales

Sacramento area homesellers, more than most other areas in the country, are battling the most brutal environment in decades…

We were one of the hottest and now one of the hardest hit. In Sacramento’s Curtis Park, even Congress members are losing homes here to foreclosure!

I am seeing way more short sales coming on the market in many areas; I hope that the banks will continue on their path and eventually the short sale will become a viable option for Sacramento area homeowners to avoid foreclosure.

My team and I have closed several; more than anyone else in my office, I think, but we have also lost many to foreclosure. Loan servicers were set up to process payments, not work out loan delinquencies on a massive scale! But recently, most of the banks seem to be getting better about communicating, processing the package, ordering the Broker Price Opinions and/or appraisals, presenting the package to the “Investor”, etc…

We are not seeing the high turnover in the Loss Mitigation Departments and some of the banks are reportedly adding massive staffing. (I understand Countrywide hired over 2,000 loss mitigation rep’s recently).

Hopefully we are getting closer to some level of predictability and stability in our market here in Sacramento.

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“Defaulting middle-class U.S. homeowners are blamed…”

May 14th, 2008 Categories: Mortgage and Loans, Real Estate News, Real Estate Trends, Sacramento Real Estate, Shortsales

This is kind of getting scarier and scarier… The more I learn bout the mortgage meltdown, the credit crunch, the sub prime debacle, the more I realize just how big our problems may be.

Found a great link today…”Defaulting middle-class U.S. homeowners are blamed, but they are merely a pawn in the game…” You see, just as housing had a crazy bubble, so did the credit markets, borrowed money was used as collateral to borrow more money, that went out in the market, bought assets that went up in value and multiplied; feeding more borrowing…

Here’s how it worked: It was just a larger version of the basic real estate market dynamics that were at work here in Sacramento… crazy to think emotions and exhuberance play such a huge part of even our global markets.

Who’s to blame? I’m not sure. Jury is still out on that… there were so many different factors, so many different players, I guess we are all to blame; except for the poor souls who were priced out or who were smart enough to realize that the crash just had to come…

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Sacramento is one of The six scariest…

May 10th, 2008 Categories: Mortgage and Loans, Pre Foreclosures, Real Estate News, Real Estate Trends, Sacramento Real Estate, Shortsales

Number of foreclosures, steep price drops and high unemployment put Sacramento on the map last week as one of the six scariest real estate markets.

The House of Representatives will take up legislation Wednesday that would broadly address the nation’s housing crisis and could have the government assume control of up to $300 billion in refinanced home loans to be given to distressed homeowners.

It also includes a bill that will provide up to $15 billion (yes, billion, with a “b”) to allow governments to award loans and grants to purchase and rehabilitate owner-vacated homes…

I just wonder how long it is going to take for the industry to figure out they need to get these homes refinanced or sold before foreclosure… It isn’t hard to see that a home that is occupied, being cared for, where the grass is watered and mowed, is going to sell faster and for more than the same house with broken windows, a dead, overgrown lawn, with the dishwasher, stove, ceiling fans and light fixtures missing… not to mention the green pools and missing air conditioners!

This is not only a problem Sacramento area homeowners are dealing with; it is happening all over.

When will the short-sale or short-refinance be embraced and used as a tool to slow the tide?

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More Hope for Sacramento Shortsales…

May 4th, 2008 Categories: My Stories, Pre Foreclosures, Real Estate News, Real Estate Trends, Sacramento RE Stats, Sacramento Real Estate, Sacramento Sellers, Shortsales

We just got an approval letter on a shortsale the other day; from Countrywide! In just three short weeks! It is for a client who’s home here in Folsom is in foreclosure. We had it on the market for only a week and received several offers, one full price with plenty down. The buyer, who understands the short sale process and the potential downfalls, is represented by a great agent I worked with at my old company. They absolutely no matter what have to live in that neighborhood and were willing to wait and take the risk of a bank saying no.

We now have two files with Indymac, another Countrywide, One with an Option One first and HSBC second (I usually don’t even try to work a shortsale listing with a first and a second, however the HSBC gal I talked to in their loss Mitigation department promised they would work with us).

We also have buyers in contract on a beautiful home in Orangevale who we are anticipating an approval letter from Homeq, this week… It is a screaming deal too– these kids will move in with 20 or 30k in equity… on a street where the last reo listing sold in two days, and in a market where we have probably reached a bottom!

Yes, these people have waited six weeks for an answer from the bank. We have seen at least thirty other houses since we wrote the offer, and the buyers have always wanted to keep the offer in and continue to try… It is always an exercise in patience and understanding for me; working with buyers who want to write on a short sale! …but it always seems to work out in the long run for the best; we either close on the short sale or find another home while we wait.

I really expect short sales to get easier… they have to!

Some banks, Indymac, Homeq, Countrywide, along with several other smaller lenders are getting their acts together and I look forward to being able to really move some real estate sometime soon.

The banks just must keep working on their systems and improving their timetables… there are so many more foreclosures coming! There has been another jump in California foreclosures last quarter, which means this summer, fall and winter, there may be another jump in shortsales and REO’s…

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Newest Sacramento Foreclosure News:

January 25th, 2008 Categories: Mortgage and Loans, Pre Foreclosures, Real Estate News, Real Estate Trends, Sacramento RE Stats, Sacramento Sellers

According to the newest research I have done, Sacramento County is ranked 6Th out of 55 in the state for population per foreclosure sale. Currently there are approximately 1,426 people for each trustee sale here in Sacramento… Right now Sacramento County Has 22,273 Foreclosures; according to Default Research (www.defaultresearch.com), that’s 4.22 percent of the households in Sacramento. Wow.

“The impact of the credit crisis that began in August is now clearly starting to show its impact,” said ForeclosureRadar… which is the only web site that tracks every California foreclosure with daily updates on foreclosure auctions. It also has a mapping feature that shows foreclosure activity from a Birdseye view and I use it frequently on listing appointments to show the number of homes in a particular area that are about to become bank owned and add to our inventory; A great way to get sellers to either throw in the towel right now or to price their home aggressively and stop the bleeding right now.

The latest foreclosure numbers and transaction reports are showing that finally we are seeing an increase in the number of real estate deals here in the Sacramento area.

Numbers for the rest of the state seem just as scary: DataQuick Information Systems of La Jolla reported that lenders sent81,550 default notices in the last three months of 2007.

At dinner the other night, I ran into a guy that told me about his own foreclosure ‘plight’: He is a displaced lender; he was in the mortgage business for over ten years and is now doing construction… He owns four income properties here in the Sacramento area; one in Folsom, Two in Elk Grove and one in Carmichael. After taking out all the equity on these homes, he put adjustable rate and neg-am mortgages on all of them (negative amortization; a type of mortgage where the monthly payment doesn’t even cover the interest, so the principle actually increases over the length of the loan). Then he took the cash to put down on a huge house overlooking Folsom lake. Now his mortgages are all in default and he is not making the payments. His tenants have no Idea. He is pocketing the rent.

I wonder how many similar stories there are out there…

Tags: Newest+Sacramento

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Closing out the year on Sacramento real estate…

December 31st, 2007 Categories: Real Estate News, Real Estate Trends, Sacramento Real Estate

As 2007 ends, Experts agree: Decline in American house prices are not over yet… and economists react: as New homes sales sink to the lowest annual rate in 12 years!!

And then; More people buying into new developments are being left high and dry when their builders file for bankruptcy. Wouldn’t that be nice?

Will prices continue to fall?

How bout this one:

Experts thought 2007 would bring a real estate recovery - not the worst collapse on record. What does that say about forecasts of a turnaround next year?

Or this one:

“Over the past decade, the exponential growth of credit derivatives has created unprecedented amounts of financial leverage on corporate credit,” he added. “Similar to the growth of subprime mortgages, the rapid rise of credit products required ideal economic conditions and disconnected the assessors of risk from those bearing it.” …what?

All I know for sure is that opportunities like this only come around every 12 to 15 years in Sacramento… for those lucky enough to have withstood the craziness of this market and are in a position to buy now: good for you; we’ll see you on easy street soon!!

Is there any doubt that prices will rebound? Does anyone wonder what will happen? Nobody knows when, but we all know this market will rebound and those who were able to buy sometime during this drop will be in the drivers seat…

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Sacramento Homebuyers: Hurry; Real Estate is on Sale!! How long can these great deals last?

December 11th, 2007 Categories: Real Estate News, Real Estate Trends, Sacramento RE Stats, Sacramento Real Estate, Sacramento Sellers

Rooting Out the Rotten Tomatoes

By CLAIRE SUDDATH

Workers separate tomatoes at the sprawling Central de Abastos market in Mexico City on June 10

Gregory Bull / AP

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So how much damage can a few rotten tomatoes really do? The tomato-linked salmonella outbreak announced by the Food and Drug Administration (FDA) on June 3 has claimed 228 victims in 23 states over 58 days (and counting). It has put 25 people in the hospital and may have had a role in hastening the death of a cancer patient. And then there’s the flurry of panic as many of the tomatoes that American consumers take for granted every day suddenly disappear — from McDonald’s hamburgers; from the salsa at Chipotle Mexican Grill; from Burger King, Taco Bell and Sonic; and from the grocery shelves at Kroger, Wal-Mart and Target. Didn’t we just go through this with bagged spinach? With peanut butter? With pet food?

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Because the FDA’s tomato-recall recommendation is so specific — including only three types, grown in certain regions during a certain time — and because many national chains pulled their tomato stock within days of the announcement, most of the infected samples have likely been removed. But the outbreak remains ongoing; its source has not yet been determined, and the government is investigating new cases every day. It may be a few more weeks before the delicious staple fruit is given the all-clear.

Taking tomatoes off shelves and menus may contain the outbreak, but it doesn’t explain it. On May 22, the New Mexico Health Department notified the Centers for Disease Control and Prevention that it knew of seven people recently infected with Salmonella Saintpaul, an unusual strand of the bacteria that accounted for only 400 of the 1.4 million cases of salmonella infection reported last year. And it was precisely because occurrences of the Saintpaul strand are so rare that the report caught the CDC’s attention. When Texas and a few other states reported cases of people being infected by bacteria with the same “genetic fingerprint,” a multistate search for Salmonella Saintpaul was launched. While the CDC tracked reported illnesses, the FDA interviewed victims to find out what they had eaten (and where). The common answer was tomatoes.

There have been 13 outbreaks of salmonella in tomatoes since 1990, which puts the fruit on the list of high-risk foods that are prone to infection. But unlike the bagged spinach from the 2006 E. Coli scare, the tomatoes don’t come with a traceable bar code. “When you’re dealing with tomatoes, it is much, much more complex,” explains Dr. David Acheson, the FDA’s associate commissioner for foods. The FDA’s great tomato hunt has an ever-expanding list of suspects. A salmonella victim can point to the supermarket (or restaurant) that sold the offending fruit, but that store probably sources its tomatoes from several suppliers, each of which uses several distributors — and distributors buy from any number of growers.

“Each set of questions just multiplies into a fan of information that has to be sorted through to understand where the links cross over,” says Acheson. Although the FDA has managed to rule out some regions — northern Florida is safe because its tomatoes weren’t ready for harvest at the time of the outbreak — it will be some time until the true source is found. “We’re not quite there yet,” says Acheson, “but we’re getting very close.” But Dr. Ian Williams, chief of the CDC’s OutbreakNet team, warns that the source may never be found due to the fruit’s short shelf life. “You don’t expect to find an infected tomato sitting on someone’s counter 10 days after the outbreak,” says Williams.

Still, the lag time between the initial outbreak and the government’s reaction is startling: the first Salmonella Saintpaul victim fell ill on April 16, but the FDA didn’t announce the tomato link until June 3. Williams says part of the problem identifying salmonella outbreaks is that a lot of victims don’t see the symptoms — diarrhea, fever, vomiting — as sufficiently severe to warrant a visit to the doctor, and so they go undiagnosed. “There may be a delay in reporting outbreaks because people do not have a stool specimen tested,” he says. Officials have not yet identified an infected tomato, and because of the fruit’s short shelf life, they probably never will.

The FDA unveiled a tomato-safety initiative in 2007 that sought to identify causes of salmonella infection, but Acheson admits that studying preventive techniques doesn’t help the FDA deal with outbreaks. The FDA has no plans to change the initiative in the face of the recent outbreak.

Even if the FDA can pinpoint the source of the outbreak, it’s hard for consumers to know where their tomatoes are grown. Certain imported foods are required to carry country-of-origin labels, but that doesn’t apply to domestic produce. “I’m not aware of any tomato outbreak that was not domestic,” says Acheson. There is no such thing as a mandatory state-of-origin label for food, and federal authorities have yet to create such a law. “Saying ‘product of the U.S.’ isn’t necessarily going to confer safety,” he says. So much for reassurance.