Tim Bryan's Paso Robles Real Estate Blog

THE TRUTH AS THOSE IN THE KNOW KNOW IT TO BE

2012-01-27T18:10:00.000-08:00

- For some time now politicians have been using FNMA and FREDDIEMAC as the whipping boys in the mortgage mess because unfortunately it is hard for the general public to understand the roles these institutions play in real estate finance. It is also unfortunate that most politicians do not understand it either. That is why it was good to see this recent articlecheck this out

Beautiful Ocean View Cayucos Home

2012-01-20T08:48:00.000-08:00

Beautiful Ocean View Cayucos Home -- If you or anyone you know is looking for a absolutely killer house, take a look at this 4 bedroom 4 bath of app. 3,700 sq. ft. with whitewater views. Check this out and turn on your sound and check out the virtual tour at the upper right. Click here

THE LIGHT AT THE END OF THE TUNNEL

2012-01-13T11:16:00.000-08:00

- may not be an oncoming train. More positive news on the national scene regarding foreclosures from Realty Trac- go to this article

YEAR END NORTH COUNTY REAL ESTATE STATISTICS

2012-01-06T14:35:00.000-08:00

- For the 1st time in the past 7 years Northern San Luis Obispo County has shown an increase in property sales over the year previous. Sales of all property types increased 19% in 2011 over 2010. Properties in escrow were up 4% in December over December of 2010 and the inventory of property on the market is down 15% from the same time last year. The average price of a home in Paso Robles declined 2% in 2011 over 2010 but that happened mostly in the 1st part of the year and that is the lowest per annum drop in a long time. With the increase in sales and the lowering of the amount of property on the market for 12 full months, one can likely assume that this market has at a minimum stabilized for the time being. That coupled with lower interest rates and some great buys still on the market should give buyers some motivation if they have been on the fence.

Is Now The Time To Buy?

2011-12-30T16:56:00.000-08:00

If you are considering a new home this year but are still wondering if you should do it this coming year, Check This Out

Help for Underwater Homeowners That Would Like to Refinance

2011-12-16T11:41:00.000-08:00

- There are a lot of people out there that owe more then their homes are worth but are making their payments fine and want to keep their homes. However, they would like to take advantage of today's lower interest rates but have not been able to because their homes will not appraise for the value needed to do a new loan. If your loan is owned be either Fannie Mae or Freddie Mac and was originated prior to 5/31/09, there is a new program that may allow you to refi and take advantage of the new rates. Be aware that even though you may be making your payment to a bank like Wells Fargo, Fannie or Freddie may own the loan and you could be eligible. You can find out on their individual websites. For more info on this, go to this

California County with the Most Distressed Property Sales

2011-12-09T13:29:00.001-08:00

- That would be Madera County where a whopping 89% of the homes sales are bank owned foreclosure properties or short sales. County with the least is San Mateo with only 23% of the sales being distressed properties. Where does SLO county stand? We are at 46% which is the exact average rate for all California counties.

2011-12-02T15:48:00.001-08:00

NOVEMBER NORTH COUNTY REAL ESTATE STATISTICS- Sales of all North County real estate types increased 3 % in November over October and are up 22% over November of last year. Sales for the first 11 months of this year are also now up 19% versus the 1st 11 months of 2010. Properties in escrow are up 5 % from last month and up 19% over November of last year. Active listings on the market are down 16% when compared to the same time last year. With only one more month to go, it is now clear that we will see a dramatic improvement in sales this year over last. That will make it the 1st time in 6 years that sales have increased over the previous year. With inventories of properties for sale also now down 16% and interest rates at all time lows, what should that tell a prudent buyer?

2011-11-25T12:27:00.001-08:00

Short Sales in Northern SLO County --

Short Sales are listings where the asking price is less then the amount owed on the property and any sale is subject to the lender(s) agreeing to take less then the unpaid balance on the existing loan. So far this year, in 2011, 17% of the closed escrows in the Northern SLO county have been short sales. However, as I reported last week, only 56% of the short sales that went into escrow in the past 11 months successfully closed. Now, although that means there is a 44% failure rate in short sale escrows, that is an improvement over the last few years. Banks have realized that they have a better return and less costs in a short sale then they do after foreclosing on a property and have become more realistic. Why then is there still a 44% failure rate? Here are some of the reasons:

1) Long Escrows due to slow processing by lenders: After a buyer and the property owner have agreed to the short sale, you still have the time frame for lender approval and there may be more then one lender. The time periods for that to take place can normally be anywhere from 30 days to 120 days or longer depending on the lenders involved. Then after that you still have your normal 30 to 60 day escrow closing period after the approval is given. Buyers get impatient waiting for the short sale approval and other properties they may like become available during that time. Too long a time wait can equal a cancellation. The solution: Although we have been doing short sales for 5 years, lenders are still not up to speed in being able to efficiently process them in a lot of cases and that needs to be rectified. Buyers also have to take a little risk and get some of the inspections done they normally would do after approval by the lenders in case there is something else about the home that will not be acceptable.

2) Unrealistic Sales Price - Since the short sale seller (the property owner) will not be getting any money out of the sale, many just want it over as soon as possible and do not care what it sells for so they put a low asking price on the property or accept a "low ball" offer. However, the short sales lender(s) really care what the price may be. If the price the seller and the buyer have agreed to is way below market value, the lender may likely not accept it. When the sale is submitted to them for approval they will order an appraisal or a "BPO" (broker price opinion} to see what the actual market value may be. They are going to measure what that their return on the short sale is vs. foreclosing on the property and selling it themselves. If you are a buyer in a short sale at a very low price, you may have to be prepared to either pay closer to market value when the lender comes back with what they will accept, be prepared for a let down or do not waste your time. If you are a seller, remember that lenders can file foreclosures and keep them running during short sales so you may not have enough time to get another buyer after your submitted one is not approved and then have a foreclosure on your credit record. Buyers can normally get a "good deal" on a short sale but it is also going have to be what the lender feels is their best option.

3) Sellers Hardship Not Approved - Just as the purchase price has to be approved, so does the seller. The seller, who is the borrower on the loan, has to show that they really cannot any longer make the payments on the loan or have other significant hardships such as a job transfer. If they just are tired of the property or making the payment on a house that is "under water" but can afford it, the lender may not approve the sale. The criteria for this varies a lot from lender to lender but as a buyer be sure and ask your agent to find out from the seller’s agent what the premise for the sale may be. Unfortunately, most lenders today still will not approve the seller's hardship prior to the offer from a buyer being submitted and this also needs to be changed.

4) Pilot Error-- Short sales are difficult transactions. The seller's agent has to be proficient in short sales and be able to deliver well put together and concise packages to the lender and effectively work with the bank and their negotiator. It is a very time consuming plus sometimes frustrating process and you have to be on top of things at all times. Although experienced short sale agents will normally have a success ratio higher then average, it is still a risk, so only the most the most diligent, persuasive, focused and tenacious need apply. Those of us who have done enough of them and have taken specialized training on short sales apply ourselves to the task and are careful to not take listings where there is a high probability of failure or with an unrealistic asking price just to get an offer. The short sale process has also been quite dynamic so the way they were done 3 years ago is different from today as lenders change their individual procedures and so it is constantly a learning and adaptation process.

5) Seller and Buyer Frustration - Sellers have to submit lengthy documentation to lenders and keep the property maintained even though they are not getting any money out of the sale. Coupled with having to lose their home and everything else that goes with it, sometimes it is just too much. There are critical things that come up in a short sale that the seller may have to do with the lender that their agent cannot and if they do not stay committed to the process, the sale can implode and their credit score will take the hit they were trying to evade in the first place. Buyers have the anxiety of not knowing how long it will take to get approvals and give up in frustration as things stretch out and just move on. Patience is a virtue but sometimes elusive.

All of the above being said, things are improving. Pre-approved short sales, where the lender stipulates up front what they will accept for a payoff and have approved the seller's hardship are starting to increase. Lenders are also improving their systems, their employees are becoming more experienced and their policies are become more realistic. Realtors are learning the process better and are adapting. No one likes a short sale in comparison to a standard transaction but they are going to be a major part of the playing field in the real estate market for some time. Sellers can avoid foreclosure through the short sale process, buyers can obtain some excellent buys and lenders can avoid having unsold properties on their balance sheets.

2011-11-18T11:33:00.000-08:00

FORECLOSURE & SHORT SALE ACTIVITY IN THE NORTH COUNTY- As of 11/18/11 of the 460 unsold homes now on the market in Northern SLO county, 9% are bank owned (REOS) and 10% are "short sales " (where the borrowers still own the property but the asking price is less then the amount owed on the property and any sale is subject to the lender agreeing to take less then the unpaid balance on the existing loan).

Of the 280 homes now in escrow (Pending Sales) or with accepted offers waiting for final lender approvals, 21% are bank owned and 41% are short sales. The reason for the higher number for short sales in escrow or waiting for bank approvals, is that the time periods for bank approvals for them and the closing of their escrows is about 4 times longer then a traditional or bank owned sale.

What percentage of short sales actually close escrow? For the past 12 months 56% of the short sale properties listed for sale actually successfully closed escrow. The main reasons short sale escrows can fail ?-- tune in next week for those answers.

Beau. Oak Studded Westside Templeton Acreage -

2011-11-11T09:13:00.001-08:00

- This app. 15 acres in the Santa Rita Creek area is close to town but is very secluded. Newer barn with cement floor and power, 1 Acre Zinfandel Vineyard and well. To see the virtual tour and more info, go to http://www.timbryan.com/listings/index.php?listing=174170

OCTOBER NORTH COUNTY REAL ESTATE STATISTICS

2011-11-04T13:51:00.000-07:00

- Sales of all North County real estate types decreased 12 % in October over September but are 10% over October of last year. Sales for the first 10 months of this year are also now up 18% versus the 1st 10 months of 2010. Properties in escrow are up 5 % from last month and up 26% over October of last year. Active listings on the market are down 14% when compared to the same time last year. Northern San Luis Obispo County real estate sales are still improving versus other areas of the country.

VERY SURPRISING!!

2011-10-21T16:51:00.000-07:00

- to see where homeownership is the highest and where it is the lowest ! Not where you would normally guess. Go tohttp://lowes.inman.com/newsletter/2011/10/18/news/157206

HATE TO ADMIT I WAS RIGHT -- but..

2011-10-14T11:03:00.000-07:00

Since the housing crisis started the federal government has come up with a few major programs to try and help distressed homeowners stay in their homes. As I looked at each one of them my first opinion was that this would not work unless the principal balance of the loan was reduced and no lender would want that to happen. Without that key ingredient, people would not qualify in today's lending environment for the same loan balance they were underwater on and would not be motivated to do so, even though if they could. The House Financial Services Committee just took a look at these and the results were not good news. Take a look at Ken Harney's excellent and detailed analysis. Click here

SEPTEMBER NORTH COUNTY REAL ESTATE STATISTICS

2011-10-10T10:28:00.000-07:00

- Sales of all North County real estate types decreased 8 % in September over August but are up 22% over September of last year! Sales for the first 9 months of this year are also now up 19% versus the 1st 9 months of 2010. Properties in escrow are down 7 % from last month but up 22% over September of last year. Active listings on the market are down 13% when compared to the same time last year. Northern San Luis Obispo County real estate sales continue to improve this year over last despite the rest of the USA having a rougher time.

Everybody Up Against the Wall!

2011-09-30T11:05:00.000-07:00

-- I love Lou Barnes's recent column where he takes no prisoners . His column is also on the whole economy and not just real estate but I found it so thought provoking I decided to post it here. We all have the tendency to to side with whoever follows the rest of our political beliefs when they promote their brand of economic policy. In this day, we may have to stop just reacting and start listening and thinking. Check It Out

AUGUST NORTH COUNTY REAL ESTATE STATISTICS

2011-09-02T15:20:00.001-07:00

- Sales of all North County real estate types decreased 11 % in August over July but are up 34% over August of last year! Sales for the first 8 months of this year are also now up 19% versus the 1st 8 months of 2010. Properties in escrow are up 8 % from last month and 23% over August of last year. Active listings on the market are down 8 % when compared to the same time last year.

To 10 Tax Tips when Selling Your Residence

2011-08-26T11:33:00.000-07:00

People normally have a lot of tax questions when getting ready to sell their residence. Some of these have changed through the years and some times you could make a bad mistake because you are relying on information from the past. The IRS just recently posted an excellent page on their website for homeowners. Go to http://www.irs.gov/newsroom/article/0,,id=243682,00.html

On the Sidelines or In the Game

2011-08-12T14:42:00.000-07:00

Real Estate is the largest purchase most people normally make. When you are in troubled times, some people seize opportunities and some people just seize. :-) To see a good article on this, go to http://lowes.inman.com/newsletter/2011/08/12/news/149949

JULY NORTH COUNTY REAL ESTATE STATISTICS

2011-08-05T17:07:00.001-07:00

- Sales of all North County real estate types increased 21% in July over June and 27 % over July of last year! Sales for the first 7 months of this year are also now up 16 % versus the 1st 7 months of 2010. Properties in escrow are down 15% from last month but 15% over July of last year. Active listings on the market are down 11% when compared to the same time last year.

California Foreclosures Hit 4 Year Low-

2011-07-22T10:52:00.000-07:00

For some good news for a change, go to http://dqnews.com/Articles/2011/News/California/CA-Foreclosures/RRFor110719.aspx

WHAT % OF SALES ARE SHORT SALES OR BANK OWNED?

2011-07-15T14:37:00.000-07:00

- In Northern SLO County, for the 1st 6 months of this year, 39% of the residential sales were lender owned properties (REO's) and 18% were short sales (where the lender agrees to take less then what is owed on the loan payoff at closing) which make a total of 57% of the sales being what are known as "DIstressed Property Sales".

PROPERTY TAXES, THE SILVER LINING

2011-07-08T15:17:00.001-07:00

PROPERTY TAXES, THE SILVER LINING - We all hate property taxes, right? Right. Well, be glad you live in California.-Well, guess where we rank in property tax rates? - Out of 50 states, we are number 48. That's right. Only 2 other states are lower. The lowest is Hawaii and just above them is Alabama. State with the highest?? -- That would be Texas-- with a property tax rate 2 1/2 time higher then us.

JUNE NORTH COUNTY REAL ESTATE STATISTICS

2011-07-01T16:42:00.001-07:00

- Sales of all North County real estate types increased 6% in June over May and 9% over June of last year. Sales for the 1st 6 months of this year are also now up 14% versus the 1st 6 months of last year. Properties in escrow are up 10% over last month and properties on the market are down 2% when compared to the same time last year. Lower prices made this happen!

Quite a Neighborhood!

2011-06-24T16:12:00.000-07:00

Think We Have Some Fancy & High Priced Areas in the US?- Move over, Aspen, the Hamptons, Bel Air & Atherton. In London the Brits have one street that takes the cake - Click on this

Foreclosures Fall for 8 Straight Months

2011-06-17T16:10:00.000-07:00

But that is not the whole story--- go to
http://money.cnn.com/2011/06/16/real_estate/foreclosures_housing_market/index.htm?iid=HP_LN

IT'S REAL SIMPLE

2011-06-10T11:55:00.000-07:00

- The real estate and financial industries spend tremendous amounts on acquiring data to study real estate buyer's demographics and when and why people will buy, etc . See what the mountain of all that data comes out to prove . Go to http://lowes.inman.com/newsletter/2011/06/08/news/144530

MAY NORTH COUNTY REAL ESTATE STATISTICS

2011-06-03T11:02:00.001-07:00

- Sales of all North County real estate types increased 9% in May over April and 23% over May of last year! Sales for the 1st 5 months of this year are also now up 15% versus the 1st 5 months of last year. Properties in escrow are up 4% over last month and properties on the market are down 8% when compared to the same time last year. A real increase for this year so far!

Lenders Have to Pony Up Big to Servicemen.

2011-05-27T14:25:00.000-07:00

There has been a long time law protecting the rights of servicemen from foreclosure when they are called up to active duty overseas. Unfortunately some mortgage holders ignored it or just were incompetent. Go to http://www.signonsandiego.com/news/2011/may/26/lenders-pay-22m-settlement-military-families/

Lowest Priced & Highest Priced California Counties

2011-05-20T16:59:00.000-07:00

-- According to April Statistics, Lake County has the lowest prices, median price of a home there is$98,330. (Must be a lot of Mobile Homes). Highest is Marin County where the median price is now $726,060. Our own SLO county is now $390,180 which is 3.2% less then a year ago in April.

April North County Real Estate Stats

2011-05-10T12:21:00.000-07:00

Sales of all North County real estate types increased 3% in April over March. Sales for the 1st 4 months of this year are also now up 17% versus the 1st 4 months of last year. Properties in escrow are also up 10% over last month and properties on the market are down 8% when compared to the same time last year. The trend continues to be positive at this time.

Largest Landowner in the US??

2011-04-30T09:34:00.000-07:00

- That would be Ted Turner, the former CNN Magnate who just added to his large ranch holdings with his recent purchase of Nonami Plantation near Albany, Georgia, the largest property in his hometown state. That coupled with his ranches in Kansas, Montana, Nebraska, New Mexico, Oklahoma, and South Dakota put him at now owning over TWO million acres. Largest in California? That would be Red Emmerson of Sierra Pacific Corp, whose timber company now owns app. 1.7 million acres.

MARCH NORTH COUNTRY REAL ESTATE STATISTICS

2011-04-08T13:47:00.001-07:00

- Sales of all Northern SLO County real estate increased an impressive 23% in March over February of this year. The 1st quarter of this year also shows sales up 12% over the 1st quarter of last year. Pending sales (properties in escrow) are down 5% from February and there is now 9% less properties for sale then there was a year ago at this time.

New Record for Highest Price ever Paid for a Home!

2011-04-01T13:27:00.000-07:00

Only in California and only in Silicon Valley do these things happen today!. Go to http://online.wsj.com/article/SB10001424052748704530204576233170859101198.html?mod=WSJ_RealEstate_LEADTopNews

New Record for All Cash Sales

2011-03-11T14:52:00.001-08:00

RECORD NUMBER OF ALL CASH SALES - In January over 30% of all homes sold in California were all cash sales. To see why, go to http://www.dqnews.com/Articles/2011/News/California/CashSales/CACash110228.aspx

FEBRUARY 2011 NORTH COUNTY REAL ESTATE STATS

2011-03-04T11:03:00.000-08:00

- Sales were down 11% in February from January but that is normal as February closed escrows depend on December openings which is the slowest time of year. 2/11 sales are up 19% over same month in 2010 and the 1st 2 months of 2011 are up 22% over the same time last year. ...

Pending Home Sales up statewide for the 1st Part of the Year

2011-02-25T15:08:00.000-08:00

The entire state is seeing what we are here. An increase in properties going into escrow. Go to http://www.inman.com/news/2011/02/23/pending-california-real-estate-sales-bode-well-spring

Bright spot for mortgages: Missed payments ease-

2011-02-18T12:56:00.000-08:00

"That, according to Michael Fratantoni, vice president of research and economics for the MBA, was very welcome news. "I think we've turned the corner as concerned with loans 30 days late," he said. "It indicates that the economy has improved." To see the rest of the art...icle - go to http://money.cnn.com/2011/02/17/real_estate/delinquency_rate_falls/index.htm

JANUARY 2011 NORTH COUNTY REAL ESTATE STATISTICS

2011-02-04T09:28:00.000-08:00

-We are off to a much better start this year. Closed escrows for last month were a full 24% higher then for the same month in 2010 and there are also 5% more homes in escrow last month then for the same time last year. Inventory is also down app. 5% then it was in January of 2010.

Bad Info on the Web Just Never Goes Away

2011-01-28T13:39:00.000-08:00

The new healthcare Law does NOT impose a new tax on the sale of your home as spread over the web lately. The new law imposes a 3.8% tax for those in the top brackets on “unearned income.” This will not impact the exclusion on capital gains from the sale of a primary residence up to $250k for individuals and up to $500k for couples which is the same it has been. The 3.8% tax will only apply to capital gains above that.

SURPRISING AND ENLIGHTENING

2011-01-21T11:26:00.000-08:00

- Historically the one nation most effected by the ups and downs of our economy has been Canada because of all of the economic interaction between the two countries. However, this time, and for the 1st time, they are virtually unscathed from the real estate downturn here. Read why at http://www.timbryan.com/listings/documents/CanadaForeclosures.pdf

2010 Top 3 Home Sales in the North County

2011-01-14T15:21:00.000-08:00

Per the MLS records, the 3 most expensive homes sold in the North County last year were:1) 3210 Cloudy Meadow Drive, Templeton- 5,000 sq. ft home on 40 acres -$2,150,000.00. 2) 4995 Bluebell Lane - Paso Robles - 3600 sq. ft on 10 acres -$1,200,000.3) 2775 Creston Ridge Lane - Paso Robles - 4,163 on 40 acres -$1,190,000.00. My office, Re/Max Parkside Real Estate was involved in all 3 sales

2010 North Country Real Estate Statistics

2011-01-07T09:02:00.000-08:00

Sales of all real estate for the North County in 2010 declined 6% from 2009. Sales of homes on acreage in the rural areas however were only down 2% from the previous year. Raw land sales were up 3% from 2009 and sales of large parcels 20 acres and up were up 5% from 2009 although volume was low in both those categories. The biggest drop of all was in homes on acreage with sales prices of $900,000 or more. That market dropped 49% from the year previous. That is very indicative of the upper end market in most areas of California.

What the above statistics show us is that with the exception of the higher end properties, the market may have stabilized as we had much higher drops each year from 2005-2009. The most active part of the market are homes on acreage with asking prices of $500,000 or less and acreage in the under $150,000 bracket.

Merry Christmas!

2010-12-24T09:26:00.000-08:00

A big thank you and a Merry Christmas to all of the followers of Tim Bryan's Paso Robles Real Estate Blog. Have a safe and good one!

NOVEMBER NORTH COUNTY REAL ESTATE STATISTICS-

2010-12-03T10:05:00.000-08:00

Numbers of closed sales in November 2010 were down 16% from October. Year to date sales for 2010 are down 6% when compared to the same time frame in 2009. Pending sales though (open escrows) are up a whopping 13% from October . The amount of listings on the market is down 3% from the same time frame in 2009.

New Rules From FNMA-

2010-11-19T11:26:00.001-08:00

Fannie Mae, who either buys or guarantees app. 28% of all of the residential loans , has some good and some bad news . Good for buyers getting part of their down payment as a gift from relatives. The bad news is for those that have gone through foreclosure or who have other revolving debt. Rea...d the NYT article at http://www.nytimes.com/2010/11/21/realestate/21mort.html?_r=2&ref=realestate

BANK OWNED HOMES SALES IN THE NORTH COUNTY

2010-11-12T14:39:00.001-08:00

- Wondering how many homes sales in the north county are bank owned foreclosures? Year to date they account for 34% of the home sales in our area. That is the same exact percentage of our sales for the same time period last year in 2009.

OCTOBER NORTH COUNTY REAL ESTATE STATISTICS

2010-11-05T10:57:00.000-07:00

-Numbers of closed sales in October 2010 were up 7% from September. Year to date sales for 2010 are down 8% when compared to the same time frame in 2009. Pending sales (open escrows) are only 1 escrow apart from September to October so virtually the same. The amountof listings on the market is also just 5 properties different from the same time frame in 2009.

Loan Modification Tricks are No Treat

2010-10-29T16:17:00.000-07:00

Most of us in this business have been approached by friends, family and even clients about loan modifications. We all know folks who are having a rough go of it and are seeking help from their lender to modify the terms of their loans so they can stay in their homes.

We have all heard them say the same thing; “The people at the bank told me they wouldn’t even talk to me unless I was late on several payments.” In many cases, bank personnel have actually advised people to let their loans go delinquent, so they can “possibly” help them! And, many people take that advice and let their payments lapse, destroying their credit with no real commitment of assistance.

Here is the real horror story – Just this morning I heard from a dear friend asking about getting a loan to buy a smaller place since her expensive house just went into escrow. After talking to her I learned that she had been seeking a modification and had taken the banks advice and let her payments go delinquent for a few months. Then suddenly an offer came through on her home and now she is in escrow. But since she has several late payments, she no longer qualifies for a loan.

It is staggering to me that banks actually allow their people to make such ridiculous recommendations to those looking for a modification. Their rational is if you’re current on payments, you don’t need help and that is plain stupid! There are a large number of people doing their best to hold up their end of the contract and make their payments but are in immediate need of financial relief. These are people trying to do the right thing.

Just imagine the legal exposure banks are opening themselves up to by recommending people voluntarily go delinquent, and destroy their credit just so that their stories will be heard. with no commitment or promise of success. It is amazing that with all of banking under such an intense microscope, this practise is allowed to continue.

One of the main reasons banks take this position is that for every family that has a genuine need for their loan to be modified, there are five more people asking for help that can actually make their payments. This clogs up the process and creates a "moral hazard" argument. Who should really get the help?

In my opinion banks should have hired more people to handle this problem and put specific procedures in place to evaluate people's financial situations and determine who really needs the help and who doesn't instead of simply telling people to let their payments lapse before they will even look at them. It would have been better for the banks as well as their clients.

Since no one in the banking world is lining up to take my advice, what should you tell people who approach you with this problem. Here is what I tell people:

● I always advise not to go late on your payments unless you absolutely have to. You will need that credit rating later in life. Typically sooner than you think.

● Continue to pressure the bank to hear your story. This is an arena where persistence pays off. Anyone who has ever gotten a loan modification will tell you it took months of constant effort, calls and stubborn persistence on their part. Treat the process like a job. Work on it everyday. Be absolutely relentless.

● Crawl up the ladder. Don’t be fended off by the customer service drone that answers your first call. Their job is to try to stop you if they can. Get to a supervisory person or above. Preferably management of the Loss Mitigation Dept.

● Be prepared to show documentation to support your declining financial situation. Show that you have let go of consumer goods or extraneous spending. It will be like applying for a loan but in this case, you need to demonstrate that you really do need the help.

● Propose terms to the bank that you can pay going forward. Don’t wait for the bank’s proposal. Look at your own finances and figure out how much you can really pay each month. Be honest to yourself in this process. There is no sense in pushing the issue if you really can’t make future payments. Any modification you propose has to be reasonable.

● Stay persistent! Keep pushing. This is where the “squeaky wheel gets the grease” is actually true.

This is your home you are fighting for so don't give in.

Would Like to Sell But Worried About the Current Market?

2010-10-22T10:54:00.000-07:00

Consider this: sellers who do have equity who would like to sell should not be shy about selling if they intend to purchase another property. Equity is equity and you may sell for less at the present time but you will also buy for much less and have a larger amount of available inventory to choose from. Also interest rates are at historic lows.

The Truth Behind the Noise

2010-10-15T14:40:00.000-07:00

WHAT IS THE REAL STORY BEHIND THE LATEST FORECLOSURE NEWS ITEM?- Here is a great Q & A from the San Diego Union Tribune that really gets to the heart of the issue http://www.signonsandiego.com/news/2010/oct/11/whats-going-foreclosures/

SEPTEMBER NORTH COUNTY REAL ESTATE STATISTICS

2010-10-08T15:13:00.000-07:00

Numbers of closed sales in September 2010 were down 5% from August. Year to date sales for 2010 are also down 5% when compared to the same time frame in 2009. Pending sales (open escrows) are down 11% in September from August. The amount of listings on the market is virtually the same as the same time frame in 2009.

Which Real Estate Markets are Under The Most Stress?

2010-10-01T12:52:00.000-07:00

Interesting new data is available which measures this in a new and innovative way. To see a very interesting WSJ article, go to http://blogs.wsj.com/economics/2010/10/01/which-cities-face-biggest-housing-risks/

NATIONAL REAL ESTATE MARKET HAS UPWARDS BOUNCE

2010-09-24T11:32:00.000-07:00

- Although I reported at the 1st of the month that our local north county market had a slight dip in August , the national stats are now in and are better. Go to http://www.nuwireinvestor.com/articles/real-estate-market-rebounds-slightly-with-better-than-expected-sales-56120.aspx

LOWER INTEREST RATES NOW MAKE 15 YEAR LOANS ATTRACTIVE--

2010-09-18T14:12:00.001-07:00

With the new interest rates there is now an opportunity for buyers & existing homeowners who want to refinance their existing loans to now build equity faster. Go to http://www.latimes.com/business/la-fi-refinance-20100917,0,4880556.story

Near Record Home Affordability

2010-09-10T09:30:00.000-07:00

The share of homes that families making the national median income could afford to buy remained above 70 percent for the sixth quarter in a row, according to the latest National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI).
Nationally, the HOI was at 72.3 percent in the second quarter, unchanged from the same time period last year and close to the index's record-high 72.5 percent, set in first-quarter 2009.
The HOI tracks the share of homes sold in a particular area that would have been affordable to a family earning the local median income. The index assumes a family can afford to spend 28 percent of its gross monthly income on housing, according to NAHB's website.

August North County Real Estate Statistics

2010-09-03T15:16:00.000-07:00

Sales(Closed escrows) for all types of real estate were down 18% in August compared to July and down 15% from August of 2009. Sales for the 1st 8 months of this year are down 5% from the 1st 8 months of 2009. Pending sales (open escrows) are down 3% from July of this year. Properties on the market are down 5% from July and off 2% from same time last year.

Quick Facts

2010-08-20T15:01:00.001-07:00

1) 64% of the households in California can now afford an entry level home, even in this economy.
2) median price of an entry-level home in California is $266,750
3)estimated monthly payment including taxes and ins. is $1,470 after a 10% down payment
4) The minimum household income needed to purchase that same home in California is $43,960. Even with the tough loan qualification practices today.

MORTGAGE RATES HIT RECORD LOWS AGAIN

2010-08-13T09:36:00.000-07:00

- From the LA Times: For solid borrowers paying 0.7% of the loan balance in upfront fees and
points, the offering rate for a 30-year fixed-rate home loan averaged
4.44% for the week ending Thursday, said Freddie Mac,
the giant government-supported mortgage buyer and generator of mortgage
securities. That compared with 4.49% a week ago and 5.29% a year earlier.

JULY NORTH COUNTY REAL ESTATE STATS-

2010-08-04T11:16:00.001-07:00

Closed escrows for July 2010 are up 1% from June 2010 and down 13% from July of 2009. Properties in escrow are up a whopping 23% from June 2010. Closed escrows year to date are down 4% compared to the same 1st 7 months of the year in 2009. The amount of active listings on the market is down 4% from June of 2010 and 3% from same month last year.

REAL ESTATE SEARCH TIPS

2010-07-30T12:11:00.001-07:00

If you are searching for real estate online and are having trouble finding things inaccurate or out of date: The two most up to date and accurate sites are Realtor.Com and Re/Max.Com because they get their feeds directly from the multiple listing services across the country.

SLO COUNTY ONE OF THE LOWEST FOR FORECLOSURES

2010-07-23T15:31:00.000-07:00

from the Telegram Tribune business page:
San Luis Obispo County is faring better than other counties in the state when it comes to foreclosure activity, according to recent data from RealtyTrac, a Southern California-based firm that keeps tabs on foreclosure trends.The county ranks 46th out of 58 counties in the number of foreclosure filings, the firm reported this week.

DOES THE STOCK MARKET AFFECT THE REAL ESTATE MARKET?

2010-07-16T09:11:00.000-07:00

This is a question a lot of people ask about and have their own perceptions of. Although they are both measures of the economy in their own ways, the fact is that at many times the real estate market can be very good while the Dow is in a "bear market" and vice versa. However, when you have a collapse like we had in fall of 2008, it will mean that people have lost a lot of their net worth which may have been used to purchase real estate and that will have an effect primarily on higher end real estate sales and commercial real estate. It may also have the effect of dampening consumer confidence because the ups and downs of the Dow are an every day item posted in the news.
Real Estate is more prone to be affected by things like interest rates, lending practices, employment rates, demographic trends and other items. Real estate markets also tend to be "localized" so that just because it may be very bad in Phoenix AZ, as long as interest rates and lending practices are good, the market here or elsewhere could be thriving or at least stable. Conversely when the DOW is having a bad day, the stocks of very profitable and healthy companies will be affected by the ones that are the primary cause of it.
At this time, many people have liquidated their stock accounts because of the volatility of the stock market and went into real estate as a more tangible investment.

Statewide Real Estate Stats

2010-07-08T16:40:00.000-07:00

LOS ANGELES (June 22) – Home sales increased 1.2 percent in May in California compared with the same period a year ago, while the median price of an existing home rose 23.2 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today. “Home sales posted their third largest increase on record for May, due in part to first-time home buyers who timed the open and close of escrow in order to capitalize on both the federal and state tax credits,” said C.A.R. President Steve Goddard. “May also marked the fifth month of double-digit gains in the median price, indicative of strong buyer demand relative to the supply of homes for sale. With a 4.6-month supply of homes for sale, unsold inventory continues to be well below the long-run average of seven months, and will continue to drive price appreciation over the next several months.”
Closed escrow sales of existing, single-family detached homes in California totaled 552,800 in May at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity increased 1.2 percent from the revised 546,490 sales pace recorded in May 2009. Sales in May 2010 increased 14.1 percent compared with the previous month.

June 2010 North County Real Estate Statistics

2010-07-02T17:16:00.000-07:00

June Sales in Northern San Luis Obispo County were up 9% over May of this year and down 4% compared against June of 2009. Sales for the 1st 6 months of 2010 were down less then 1% over the 1st 6 months of 2010. This tells us that we reached the bottom of the market last year and although there is no large increase over last year there is also no real decrease in activity. The amount of properties on the market is up only 2% from same time last year so no real change in supply either.

MORTGAGE RATES SINK TO RECORD LOWS

2010-06-25T10:18:00.001-07:00

Mortgage rates slumped to record lows this week, Freddie Mac confirmed Thursday, with lenders on average offering 4.69% on a 30-year fixed-rateloan. The average rate on the 30-year loan fell from 4.75% last week, dropping below the previous record of 4.71% set in December. As recently as early April, the average was at 5.21%.

HIGH END HOME SALES IN URBAN AREAS SEEING LIFE

2010-06-19T08:00:00.000-07:00

Bay area and San Diego home sales quoted recently are showing an upturn in their high end markets. Although too soon to sell if this is a real trend, this could be caused by lower pricing for larger homes then in the past .

Someone Has the Faith

2010-06-10T17:14:00.001-07:00

The Wall Street Journal reported this week that KB Homes, one of the nation's largest homebuilders bought 490 home sites in Riverside County's Eastvale community and 174 in San Bernadino County's North Fontana this week. They believe that things are coming back and they want lots to build on. We are also seeing some SoCal developers coming back here looking for development property. The smart money may know something.

MAY NORTH COUNTY REAL ESTATE STATISTICS

2010-06-04T13:17:00.000-07:00

97 properties closed escrow in the North County in the month of May which was a 1 % increase in closings from the month before in April. It was a 13% decrease from the same month a year ago in 09. There is less then a 1% decrease in the 1st 5 months of this year against the 1st 5 months of 2009 which means it is virtually the same amount of activity. Pending Sales (properties in escrow) were down 3% in the month of May against the month before in April.
Summing this all up
just again indicates that the market here bottomed out last year and it is the same this year as then as indicated by no real increase or decrease in activity this year from last so far. Have a good one and thanks for reading and following my report....Tim

Waiting for the Market to go up Before you Sell?

2010-05-28T16:29:00.001-07:00

Waiting for the Market to go up Before you Sell?
Consider this: On January 1, 2011, the capital gain tax reduction that was signed into law by President Bush will "sunset." The tax rate will revert from the current highest rate of 15 percent rate back to the former 20 percent capital gain tax rate that was in effect prior to 2003 unless it is extended.

Many experts and many of those in the know do not expect that extension to happen so the higher rates are going to kick in if it does not. Most experts and those in the know also do not expect to see any appreciable raise in real estate values in the near future also. So, bottom line is that if you have:
1) equity in your investment properties
2) or more then 250k or more equity in your home if you are single or married filing separately or 500k or more equity in your home if married filing jointly,
AND: were considering selling sometime in the future ,
it might be wise to contact your tax professional very soon. If you then decide it may be best to go ahead now, give me a call at 591-5239 and I would be glad to discuss the current market with you and if it would be best to put your property up for sale now if it will save your 5% in any capital gain taxes. None of us have a Chrystal ball but it may be worth your time to explore this.

Shocking Numbers in the Media are Not Always as Bleak as they Seem, Chapter Two or Mark Twain, you were enlightened:

2010-05-19T17:13:00.001-07:00

You have heard me harp on this before. The black cloud of the week was reported in the media as follows: "10% of all home mortgages are now Delinquent". Sounds really bad and it is accurate but despite the fact that this also means that 90% are not, here is the real thing to remember:
App. 50% of owner occupied single family homes in this country are owned free and clear with no mortgage. So what this really means is that only 5% of the homeowners in this country are behind in their payments. The normal person would think that the news quote means that 1 out of every 10 homes in America is headed for foreclosure.
So after, app. 5 years of a real estate slow down and the worst and longest national recession since the great depression, 95% of the homeowners in this country either owe nothing on their homes or are current on their mortgages. Puts a whole different light on it doesn't it? As Mark Twain once said: "There are lies, damned lies and then there are statistics".

Disputing a Bill: Right or Wrong?

2010-05-07T15:25:00.000-07:00

Have you ever disagreed with a bill you received from a cell phone service you discontinued; or a doctor bill you were sure you paid? All of us have had to go toe-to-toe with some company or another over errors in billing and in most cases we usually get the problem cleared up and the issue is taken care of.

Then again……..there are those times that you are sure you’re right but they just won’t see it your way, and they send that $25.00 doctor bill to some nasty collection agency. You try dealing with the collector and after you don’t have any success, you simply ignore him until he goes away. Which, he eventually will do.

However, what doesn’t go away is the negative report that’s been left on your credit.

So what’s the big deal? How bad can a dispute over $25.00 impact your credit? After all, the amount is so small and there is no reason why you should have to pay it. You’re sure you’re right…….right??

The truth is it can be a very big deal! This is something I encounter all of the time and just today I dealt with a client who had otherwise perfect credit. But, she had one delinquent medical bill for the aforementioned $25.00 that went to a collection agency and it dropped her credit score by nearly 100 points!

In her case it lowered her score to the point where it cost her an extra $1,500 in fee in order to get the interest rate she wanted on her loan.

There are times in life to stick to your guns and fight for what’s right, and then there are times where it makes more sense to simply pay the bill and minimize any damage to your credit. In this case the $25.00 collection proved to be far more expensive in the long run.

I’m not suggesting that a person mindlessly pay when they believe the bill is wrong. But in cases like this, small dollar disputes can have far reaching and expensive consequences that you may not anticipate. I’ve dealt with many clients who have had several small collections like this and it prevented them from qualifying for a loan. That is a tragedy.

If you are getting ready to start looking for a home to purchase, or you need to refinance, have a lender you trust run your credit first and make sure there is nothing hidden in the report that could hurt your chances for getting a loan.

North County April 2010 Real Estate Report

2010-05-05T16:00:00.001-07:00

Closed Escrows in Northern San Luis Obispo County were up 8% in April compared against April 2009 but down 17 % from March of this year.
Sales for the first 5 months of 2010 are up 1% against the first 5 months of 2009
Available inventory of property for sale this month is down 2% from April of last year.

Confusion over the Supply of Foreclosed Homes

2010-04-30T10:24:00.000-07:00

One of the biggest unanswered questions for those of us tracking the market should be much easier to get the data for but it is the hardest statistic for us to get. Click below for more info
Even the people who have the most at stake are having problems with this. Check this Wall St. Journal article out: Debate Rages

Remodeling projects are making a comeback

2010-04-26T21:10:00.000-07:00

Times have a way of changing things
http://www.latimes.com/business/la-fi-home-improvement-20100426,0,7527525.story

Foreclosure Rate in California Plunges

2010-04-21T21:12:00.000-07:00

A 40.2% drop in the first quarter suggests that the foreclosure crisis is easing. Read More BelowLA Times Report - click on http://www.latimes.com/business/la-fi-foreclosures-20100421,0,7066382.story

North County 1st Quarter Sales Results

2010-04-09T11:52:00.000-07:00

Sales for the 1st quarter for Northern SLO County are in and they are showing an interesting trend. Click below to read!
Closed escrows for the 1st quarter of 2010 in Northern San Luis Obispo County as measured against the 1st quarter of 2009 were only 1 sale different! On top of that, pending sales (properties in escrow) were also only 1 sale apart!! Considering that the average price of a home is within less then 1 % point apart for the same time frame, what does that tell us?
It tells us that the market has likely bottomed out and has for the most part, stabilized. We are also seeing developers/builders and the active real estate investors with cash coming back into the market. Barring any major national economic catastrophe, we think the major bleeding is over. We also think we will still be dealing with foreclosures for app. 2 years and short sales for a little longer then that until that inventory is fully cleaned up. That should keep prices flat for the time being so there will be some major buying opportunities for a while for those that are in it for the long pull.

Your Credit Score - The Basics

2010-03-31T12:21:00.000-07:00

These days more than ever your credit score is key to not only having access to better loan programs but the score will determine how much you pay in rate and fees. There have been many changes in recent years and Fannie and Freddie have instituted risk based pricing which may impact you if your score is below 740. So it pays to keep your score in good shape.

So how do you do that and what are some of the tricks that can help you maintain a good score?

Obvious things to avoid – these are delinquencies, bankruptcies and judgments to name a few. A single delinquent payment can cost you 50 to 70 points in your score. A delinquent payment doesn’t mean that you got your payment in after getting assessed a late charge. That is still late but it won’t appear on your credit report until you are over 30 days delinquent.

Bankruptcy will stay on your report for upwards of 10 years but the impact, or the damage to your score will fade over time. Typically you can get back into buying a home when your BK has been discharged for 3 or more years. Of course, the further in the past the BK, the better for your score and your chances of getting a loan.

Your score constantly changes – which is something few people realize and is a good thing. As all the companies that you do business with report to the credit bureaus, your score will move up and down. It is very dynamic. Knowing this helps you control your score to some extent. As an example, as delinquencies get older the score will go up. This will take time but other activities will have an immediate effect.

Card balances v. limit – here is where you have lots of control. If your current balances on your cards is more than 35% of the total available limit, it will degrade your score. The closer you get to having cards that are “maxed” the more your score will go down. The impact can be equal to a delinquency. So one trick is to keep your balances low, versus the available limit.

Don’t use just one card – if you let your other credit cards go dormant because you don’t use them, then they will drop out of the algorithms the credit bureaus use to calculate your score. You want them to be part of your financial picture and if you keep them active by buying a tank of gas or groceries now and again, they will show on your report as having low balances versus their limits and it will enhance your score. That way, you can make the cards you have work to improve your score.

Credit repair companies – are, in my opinion, a complete sham. Remember, I am expressing my “opinion” so here it is. Unless a damaging item appearing on your card is incorrect, or doesn’t belong to you, then your credit history is your own and nothing can change it. If you were actually late, or filed BK, then these are facts that no one can change. Look at this as an “It is what it is” situation.

The company you missed a payment to is not likely to alter the credit report to reflect you paid on time without a compelling reason. Call them and discuss it with them directly. If it was your first late, or you have been a loyal customer they may update the report for you. But if you have a bankruptcy, then don’t expect the court to send a false report to the credit bureaus for you.

About the only place these companies can actually help you is if there is erroneous data on your report. They can help you contact creditors and get corrections made. However, this is something you can do yourself at no charge. So, why pay someone else to help you?

Contact me – if you have any questions or want additional information, please don’t hesitate to contact me at (805) 237-8811 or email me at steve@connecthomeloans.net .

Paperwork - Should Borrowers Take a Stance?

2010-03-23T15:29:00.000-07:00

So how much paperwork do you need to give a lender these days to get a loan? Not that much really, but many people in the market today appear to be uncomfortable with providing much, if any documentation to a lender that is trying to determine if they can safely lend these folks a couple of hundred thousand bucks. In fact, I have encountered an increasing number that simply draw a line in the sand and dictate what paperwork they are willing to part with.

So how did this situation develop and why are these folks playing hardball? And the better question is; should they?

Since the very early days of lending, it has always been understood that in order to qualify for a loan, you had to provide some information about your personal finances.

Near as I can tell, the need for full documentation started to change a little over ten years ago when “stated income” loans began to become more commonplace. The large depository banks, along with investors and lenders at all levels, felt protected by ever appreciating property values and they became emboldened to create loan products with riskier guidelines. Thus the “stated income” programs were born. Originally they were put in place only for the self employed and then they were quickly extended to W2 wage earners.

This made the whole loan process, from application to funding, very simple and largely trouble free. After all, you no longer had to prove your income; so you were no longer asked to provide pay-stubs, tax returns or rental agreements. In many cases the buyer didn’t have to provide bank statements either. They could go to see their loan officer, have a credit report pulled, sign an application and then not even have to talk to the loan officer until they went to sign their documents at the close.

This was great! Unfortunately, it also gave rise to a whole group of borrowers whose only experience has been in a stated income environment.

Now, these same buyers come back into the market to purchase or refinance and they discover that things are very different and they are being asked to provide income and asset documentation. They are often shocked and some end up taking a stance with their lender and in effect, drawing a line in the sand defining for everyone what information they will and will not provide.

Things are very different in the lending market of today versus that of even a few years ago. Stated income is gone! Fully documented lending is the only way loans are getting done.

So here is the point of all this. - In order to lend any money in today’s market, just as it was done in the past, a lender has to be able to look at your income and asset documentation. So there is no sense in drawing a line and attempting to decide for the lender, what they can and cannot see. For those that do this the result is easy to predict, the loan gets denied.

Find a loan officer you trust and be prepared to work with them, not against them. The loan officer is not going to ask you for any more paperwork than is absolutely necessary. A competent loan officer knows what is required and will easily explain it all to you. In today’s market you need to team-up with your lender and participate in the process.

The loan officer is your advocate, not our adversary.

Tax exemption for homeowners in distress goes to governor

2010-03-12T16:28:00.000-08:00

Prior to 12/20/2007 , if a homeowner who had a foreclosure, loan modification or short sale may actually have had the debt forgiven become a taxable event and had it be deemed income as far as the IRS was concerned. Just what someone in that position needed. The feds did take that nasty rule out of the IRS code in 2007 but California did not follow suit. However, this may change soon. Read on

The California Senate voted 21-15 on March 11th to approve legislation that would prevent homeowners who have had a foreclosure, loan modification or short sale from being required to pay state income taxes on the debt forgiven.
The bill, SB32 (8X), by Sen. Lois Wolk (D-Davis) also makes other changes to the state tax law so it will conform with federal income tax law. It now goes to Gov. Schwarzenegger, who has 12 days to sign or veto the measure once it reaches his desk.
If signed by the governor, the law will become immediately effective. It is retroactive to include the 2009 tax year and the exemption on state taxation of forgiven mortgage debt would remain in force through 2012.

Safe From All Fears

2010-02-25T14:36:00.000-08:00

Ever wonder how many homes are owned free and clear in the United States? The answer is very surprising. According to the Unites States 2005 census, app. 33% of all homes in the United States do not have any mortgage whatsoever. So 1/3 of the homeowners are not worrying at all about being "underwater" on any home loan in any event. If you think about it, there are a lot of homeowners who also owe less then 50% of the value of their home to the bank so things are more secure then you may thought.

Paso Robles outsells Atascadero in 2009

2010-02-19T17:01:00.000-08:00

According to MLS statistics, there were 22% more residential sales inside the city limits of Paso Robles then inside Atascadero in 2009. Right now there are 13% more homes on the market in Paso then Atascadero. Both towns claim a population of app. 29,000 people.

North County Sales Continue to Climb

2010-02-12T17:20:00.000-08:00

Real Estate sales in Northern SLO County were up 22% in January 2010 over January 2009! This is the 8th straight month of increases. I think we can now say that a trend has developed of the market having bottomed out and in a sustained recovery. However, prices are not rising but that is to be expected because price always lags behind increased velocity in the real estate market. If you have been thinking of buying, you might want to get started to take advantage of this while you can.

Home Path Financing: A Great Way to Buy!

2010-02-05T15:20:00.000-08:00

In this current economic climate you need every advantage you can get when it comes to your spending, especially when buying a home. There is a little known loan program from Fannie Mae called "HomePath", which can make qualifying easier and allow you to buy more home. Here's how it works:

The program finances up to 95% of the purchase price with no mortgage insurance and no appraisal required! Typically when you put down less than 20% of the purchase price of a home, you have to pay a monthly mortgage insurance premium that protects the bank in case of default, but it is of no use to you. And, the average per month cost for the mortgage insurance runs about $200.00. With HomePath you don't have this extra monthly cost. This saves you money and enhances your ability to qualify. It's like getting $200.00 a month added to your qualifying income!

The average appraisal cost is $400.00 and since HomePath doesn't require an appraisal, this is another savings for you. The other aspect is that no appraisal means no worries about how the appraisal will come out. This can relieve lots of anxiety and make the process of buying a home much more enjoyable.

The HomePath loan program is only for certain properties owned and being sold by Fannie Mae. You can find these properties by going to Homepath.com or by talking to Tim Bryan at REMAX Parkside Real Estate. Tim can be reached at (805) 591-5239.

Very few lenders are certified to carry the HomePath Loan Program and I am proud to say I am one of them. If you have questions, or need assistance, then please call Steve Allen at Connect Home Loans (805) 237-8811.

Wall Street "Experts" get the Real Estate Market Wrong Again

2010-01-22T11:12:00.000-08:00

This month, one day the stock market took a fairly large drop and the recent for it was quoted as being because "the National Association of Realtors had reported that number of pending sales of existing homes had dropped in December over November pending sales fueling belief that the housing recovery that was happening had now actually stalled out". Why did that news leave experienced Realtors laughing rather then crying?
The truth of it is that this normally happens every December, regardless of market conditions. Pending sales are the numbers of escrows that are opened, not actual sales that have closed. December is the holiday period and people just normally do not look at homes and/or make buying decisions in that month. It happens every year but this time Wall Street decided to react to it.
What you should be interested in is what was the difference between this December and last December. In northern San Luis Obispo County itself, Pending sales were up 33% in December 2009 over December 2008. That is relevant, useful information and is a positive sign of recovery, not the other way around.
We all think the Wall Street gurus are pretty smart, but how many other times do they react incorrectly to reported news that they just do not know enough about?

Participate in Your Loan

2010-01-14T15:39:00.000-08:00

There was a time not so long ago that the loan process was fast and easy. You met with your loan officer, talked for a few minutes, maybe signed a disclosure or two and the next time you had to be involved with your loan was when you went to the escrow company to sign your loan documents. Yes….…those were the days.

Unfortunately, all of that is behind us now. Massive regulatory changes to the industry have made the process more complex and the tightening of lending guidelines requires borrowers to part with far more information than ever before. Expect to have to provide copies of your tax returns, pay-stubs and bank statements as well as any statements covering your investments.

Plan to meet with your loan officer before you ever start looking for a home to buy. When you meet for the first time, bring all of your documentation so that the lender can perform an accurate evaluation of how much you qualify for. That way, when you go out with your realtor to look at homes, you will have the confidence of knowing what you can afford and that your loan can get done.

So often people start looking for homes before they learn what they can afford and then they grow increasingly frustrated when they find out later on that they can’t buy the house they have become emotionally attached to. A knowledgeable loan officer can save you a tremendous amount of anxiety and keep the frustration out of the process.

When you do reach that magic moment when your offer is accepted, be prepared to be as responsive as possible to your loan officer. The added complexity in the process means that the timetable has been impacted too and the faster you can provide your loan officer with what they need, the better the chances that your deal will close on time.

Today more than ever before it is vital that you have a competent and technically knowledgeable loan officer to guide you through the process. When you do find one you trust, work with them and be prepared to be an active participant in the process.

Let me be your guide! If I can be of assistance or answer any questions, please contact me.

Steve Allen Connect Home Loans (805) 237-8811.

Additional Home Buyer Tax Credits Proposed in Calif.

2010-01-08T16:05:00.000-08:00

During his State of the State address, Governor Schwarzenegger today announced his 2010 proposals for California. Included in the proposals is a recommendation to set aside $200 million for a new round of $10,000 state tax credits for first-time home buyers. The proposal expands upon the initial $10,000 state tax credit by including both new and existing homes. Last year’s tax credit applied only to new homes.

The tax credit could be combined with the recently extended and expanded federal tax credit for home buyers.

End of the Year Finds Good News for North County Real Estate

2010-01-01T21:22:00.000-08:00

Sales of all properties in the north county were 6% higher in 2009 then they were in 2008 with a very strong surge in the last months of the year. What does this really mean? What this may indicate is that the bottom has likely been reached in this area. What we expect for 2010 is a stable market without much in the way of price increases but with a strong possibility of another year of increasing sales volume. Sales of bank owned properties will still be with us for some time yet as well as sellers “underwater” resorting to short sales.

However, sellers who do have equity who would like to sell should not be shy about selling if they intend to purchase another property. Equity is equity and you may sell for less at the present time but you will also buy for much less and have a larger amount of available inventory to choose from. There are two other large inducements to selling and buying now. There have never been lower interest rates and a lot of experts do not expect that to last long. The second one is a new tax credit available until April 30th to qualifying buyers who have owned their existing homes for at least 5 consecutive years and meet other guidelines. The most demand right now is for homes in the $400,000 and down range. The best buys are for the larger homes in sought after locations where there are a lot of excellent buying opportunities.

Best Real Estate Search Sites

2009-12-23T12:08:00.000-08:00

Back when I first started, the main way people found property for sale before they started working with a Realtor was:
1) Looking in local newspaper ads or real estate magazines
2) Driving around neighborhoods looking for "For Sale" signs.
Then the internet came along and everything changed.   Tech smart and forward thinking Realtors developed their own websites and then the large national sites which obtain their feeds from the local mls's, large publications and other websites came into play. Unfortunately, a lot of the large ones are not the best and cause people a lot of confusion. I have compiled a list of my top pics for the ones I think are the best nationally and for this area alone.

1) ccrmls/rapmls.com
This is the site that the general public can use to see all the properties available for this area and in real time. This is actually the site that houses the database that the large national sites like Realtor.com, Zillow and others pull their information from for the central coast. However, while the large ones will have up to 24 to 48 hour lag times for when they upload new information from ccrmls/rapmls.com, as Realtors in the area enter new listings and change information on existing, it will show instantaneously here.   Although bare bones and not a lot of bells and whistles, this gives the most current data available. To bypass the log in screens and get right to it, Click here
2) Realtor.Com
Realtor.Com has always set the bar for everyone and they have some excellent ways to save your recent searches and look at property for the entire country also.   The longest running national site and more up to date them most. The standard setter for the industry. Go to http://www.realtor.com/
3) Re/Max.Com
Not just Re/Max listings. Everyone else's too. Ok, ok, I know you will think I am biased but Re/Max is the largest real estate organization in the world and as such, has properties for sale in other countries also. Always highly rated for search speeds and for the other information on their site. go to http://www.remax.com/
4) Trulia.Com
Although, not as well known as Realtor.Com and Re/Max.Com,   Trulia has come a long way recently. Basically the same info as the other two, but very interactive for the public. They have some great web gadgets as well as forums where you can ask question of local Realtors. Go to http://www.trulia.com/
5) Google Maps Real Estate
Not well known, this is a great site for using maps rather then data for your search. Very intuitive and fun to use for your searches as you can see the tools here to see what the other homes in the neighborhood that are not for sale look like.   They pull their information from a number of sites so not as current and accurate as the rest but still helpful. Go to http://maps.google.com/help/maps/realestate/
   Anyway, these are my picks if you are looking to search on your own!

Beware of Average Home Price Quotes in the Media- Especially SLO county.

2009-12-22T08:57:00.000-08:00

When seeing statistics in the news media such as "The Average Price of a Home fell 3% last month in the County", be cautious of how much that information really means to you. That is especially true in our location.   Here's why- The average price is determined by taking the total $ amount of all of the sales in the county and dividing them by the number of sales. Sounds correct enough and it is a correct number. So, why I am saying why you need to be cautious of using that information?
In a given month,quarter or year, there are larger amounts of certain price ranges, such as smaller homes in a lower priced area of the county, that will close escrow and that will skew the numbers and make it appear that prices have dropped when they actually have not. For instance, a large tract of low priced homes in Shandon could finish construction and a very large number of them close escrow in one month against the rest of the sales in the county and then it could be reported that the average price of a home fell that month and that may not be true. Conversely, an expensive tract of large luxury homes in Avila Beach could finish construction and many close escrow in that month and that would make the statistics appear like prices have risen when that's not true. In SLO county, we have very diverse areas and extremely different values from one location to another which is not the same as larger urban areas. It is very common for certain areas as well as certain types of properties in our county to be selling better then others at any given time and that will affect the average price of a home value given for the entire county and that may not accurately portray the actual state of the market.
So, how do you get a handle on what your property has done value wise or what the market you are looking to buy in track record has been?   You want to get an evaluation by looking at what similar sized properties in the same location as yours or what you want to buy have done. Your local experienced Realtor of choice can do that by using the data we have available to us and by also our advantage of actually showing and evaluating properties on a regular basis.   Don't ask a Realtor in Nipomo to evaluate your property in Paso Robles or vice versa. We may have all the same data by being in the same MLS system but you want to talk to someone who works an area regularly with every day "boots on the ground" experience in your location. Local experts know how to see the results of the data and then make a more "real time"comparative analysis which will make a more accurate and useful evaluation for you.
Also, be wary in using some onlite sites such as Zillow.com.   They can be extremely inaccurate in certain areas such as ours and they admit that. They primarily use cost per square foot valuations within a certain proximity so they give no value to larger lots, etc.   So if a home on 1 acre sold for $400,000 then a same sized home on 50 acres next to it would get the same value, etc.   I sold a home on the ocean front last year which Zillow gave a value to of $654,985.00 and it closed escrow for $1,800,000.00.   That was because their system compared it to homes that were next to the highway 1/4 mile away.
In conclusion, just remember the old tried and true statement: "location, location, location".

Loan Qualifying and Tax Returns

2009-12-16T13:49:00.000-08:00

Just open a newspaper or turn on the television news anytime in the last few years and you'll know that getting a loan to buy a home or refinance just seems to be getting harder and harder. There is a reason for this and it is called "fear". Basically everyone is afraid of losing money as more and more loans go into default. And this fear of more losses has caused everyone in the business to tighten their criteria for lending. By tightening the guidelines, they feel they are playing a role in limiting future losses.

It is debatable as to whether some of the guideline changes will actually help curb losses. In many cases the answer is a resounding no. However that may be, the fact remains that we have to abide by these guidelines in order to help people obtain a loan.

So in order to help you be better prepared when you talk to a lender about qualifying, let's look at one of the key components to the process. This is your federal income tax returns (1040's).

If your self employed or you work for someone and receive a W2 form at the end of each year, you will be required to furnish copies of the last 2 years of your income tax returns when you apply for a loan. This may seem strange when you are a wage earner and your pay-stub and W2 forms show the income you made. And in times past, that was all you needed to produce to prove your income.

Nowadays, underwriters are required to closely examine your returns because they are looking at what you wrote off in the way of expenses. For W2 wage earners the big concern is "unreimbursed employee expenses". These are business related supplies or equipment that you purchased but your employer wouldn't pay for. Since they are entered on your returns, the underwriter will deduct them from your income. Typically they will average these expenses you reported from the 2 years of returns.

If you are self employed, then all expenses incurred in the operation of your business will be deducted from your income. The best way to get a feel for your actual income is to examine your Schedule C. Line 31 is your net income from the operation of your business after all expenses are taken out. You can add back in the expense from line 30, for having a home office, and you can add back in any depreciation. Do the same calculation from each tax return; add the total income figure together and divide it by 24 months. That is going to give you a pretty accurate income figure that will be used for qualifying.

It is tempting to view the write off's on your own returns as being merely "paper losses" in order to pay less income tax. Although we may all understand what a paper loss represents, and that your actual cash flow is higher, what you have submitted to the IRS is going to determine your income when it comes to qualifying for a loan.

We are working in a lending environment where everyone deals in facts and your tax returns will define your qualifying income.

If I can assist you in qualifying for a loan or if you simply have questions and need answers, please feel free to call me at (805) 237-8811.

Calif. Assoc. of Realtors announces housing forecast for 2010

2009-12-14T16:49:00.000-08:00

To read the forecast for where the market across the state may be going in 2010, go to
http://www.car.org/newsstand/newsreleases/2009newsreleases/2010forecast/

Dept. of Real Estate Commissioner discusses Lending Fraud in the North County.

2009-12-14T08:37:00.000-08:00

Jeff Davi, Commissioner of the Calif. Dept. of Real Estate. gives an interview with the local Tribune on the hard money lending issues that took place in the county. Go to www.sanluisobispo.com/news/local/story/955818.html to see the interview

Sales Rise Higher in November

2009-12-12T16:40:00.000-08:00

Closed escrows in November 2009 were 32% higher over November 2008 for Northern San Luis Obispo County. This is a dramatic change and indicative of buyer's acceptance of today's lower pricing. There were also 31% more escrows opened in 11/09 then 11/08 so we are definitely on a positive trend.
Most activity is still in homes priced below $450,000. There is also more activity in the mid range and a little more in the $800,000.00 range but these areas are still feeling pressure.

First Time Home Buyer Tax Credit Extended + New Program for Existing Homeowners

2009-12-12T13:06:00.000-08:00

IR-2009-108, Nov. 24, 2009

WASHINGTON — A new law that went into effect Nov. 6 extends the first-time homebuyer credit five months and expands the eligibility requirements for purchasers.

The Worker, Homeownership, and Business Assistance Act of 2009 extends the deadline for qualifying home purchases from Nov. 30, 2009, to April 30, 2010. Additionally, if a buyer enters into a binding contract by April 30, 2010, the buyer has until June 30, 2010, to settle on the purchase.

The maximum credit amount remains at $8,000 for a first-time homebuyer –– that is, a buyer who has not owned a primary residence during the three years up to the date of purchase.

But the new law also provides a “long-time resident” credit of up to $6,500 to others who do not qualify as “first-time homebuyers.” To qualify this way, a buyer must have owned and used the same home as a principal or primary residence for at least five consecutive years of the eight-year period ending on the date of purchase of a new home as a primary residence.

For all qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 tax returns.

A new version of Form 5405, First-Time Homebuyer Credit, will be available in the next few weeks. A taxpayer who purchases a home after Nov. 6 must use this new version of the form to claim the credit. Likewise, taxpayers claiming the credit on their 2009 returns, no matter when the house was purchased, must also use the new version of Form 5405. Taxpayers who claim the credit on their 2009 tax return will not be able to file electronically but instead will need to file a paper return.

A taxpayer who purchased a home on or before Nov. 6 and chooses to claim the credit on an original or amended 2008 return may continue to use the current version of Form 5405.

Income Limits Rise

The new law raises the income limits for people who purchase homes after Nov. 6. The full credit will be available to taxpayers with modified adjusted gross incomes (MAGI) up to $125,000, or $225,000 for joint filers. Those with MAGI between $125,000 and $145,000, or $225,000 and $245,000 for joint filers, are eligible for a reduced credit. Those with higher incomes do not qualify.

For homes purchased prior to Nov. 7, 2009, existing MAGI limits remain in place. The full credit is available to taxpayers with MAGI up to $75,000, or $150,000 for joint filers. Those with MAGI between $75,000 and $95,000, or $150,000 and $170,000 for joint filers, are eligible for a reduced credit. Those with higher incomes do not qualify.

New Requirements

Several new restrictions on purchases that occur after Nov. 6 go into effect with the new law:

Dependents are not eligible to claim the credit.
No credit is available if the purchase price of a home is more than $800,000.
A purchaser must be at least 18 years of age on the date of purchase.

For Members of the Military

Members of the Armed Forces and certain federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and still qualify for the credit. An eligible taxpayer must buy or enter into a binding contract to buy a home by April 30, 2011, and settle on the purchase by June 30, 2011.

For more details on the credit, visit the First-Time Homebuyer Credit page on IRS.gov.

Related Items:

IRS YouTube Videos

New Homebuyer Credit, November 20

New Blog

2009-12-11T12:11:00.000-08:00

Welcome to my new web blog for Paso Robles and other northern San Luis Obispo County real estate topics