Archive for the 'San Diego county Real Estate News' Category
Something to consider when shopping for a short sale home
August 2nd, 2010 Categories: Real Estate News, San Diego county Real Estate News, San Diego homes for sale
ENCINITAS- As I was reviewing saved property searches for clients this morning, this short sale listing came up for one client. It is a great illustration of short sale pricing, decision making and marketing, so I thought I would share it.
First, I am making one big assumption and that is the buyers financed 100% of the purchase as there are two loans recorded on the closing date. These loans, totaling $510,000, are from the same lender and one is 80% and the other 20%. This was a typical lending scenario when the real estate market was going nuts in 2006.
Take a look at the photo below. The original asking was $450,000 which represents an approximate depreciation of 12%. After a period of time, the purchase price was reduced to $330,000 and an offer was received. The banks generally do not touch short sale files until an offer is in place and that appears to be the case here. The bank, through their processes, determined the value of the home to be $420,000 and issued the approval as such. According to the agent’s comments, the bank is also willing to a 3% seller’s credit towards buyer’s recurring and non-recurring closing costs. Unfortunately for all parties, the buyer walked, hey they thought the house was for sale at $330K not $400K, and the house is now back on the market.
As you can see the banks just do not throw up their hands and issue approvals. They research the market using BPOs, broker price opinion, and take in to account the net loss of any offer. At $330,000, in this case, the bank is losing about $180,000 in loan value plus approximately $20,000 in closing costs. This represents an approximate loss of 39%.
When you come across a short sale that is ‘too good to be true”, well, it probably is. Do yourself a huge favor and contact your local REALTOR, 760.415.3329, to do this research for you and to determine market value. You can definitely save money with short sales if you are patient, but as the scenario above demonstrates, you need to be prepared to pay fair market value. If current market value is $100,000 more than you can afford, I would strongly suggest moving on.
Now as a REALTOR, I do think this pricing situation is very misleading and should be corrected. When agents initially list short sales so far undervalue, yes they know they are doing it, they do so protected by a cloak of ignorance of sorts. The rational being, if they do not know the purchase price the bank is willing to accept through direct communications they need to set the price they determine to be attractive to buyers. Again, without a buyer, the banks generally do not touch the file, so they really need a buyer. HOWEVER, in this situation, the agent knows the bank is looking for $420,000. Yes it is acknowledged in the remarks, but it should also be the list price of the home. I could understand a price of $399,000 to attract internet shoppers looking under $400,000 as the bank most likely will accept a high 300’s offer, especially if they do not take the credit, but to continue to list this home so far under the bank approval is irresponsible and does not meet a standard of honesty, in my opinion.
So remember, shopping short sales is not a bad strategy, but make sure you do some homework prior to putting pen to paper and getting excited. The agent has an incentive to submit ANY offer to the bank. They need this to start the process.
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Come out, come out, wherever you are
July 22nd, 2010 Categories: Real Estate News, San Diego County Community News, San Diego County Fixer of the Week, San Diego county Real Estate News, San Diego homes for sale
OPPORTUNITY AWAITS HOMEBUYERS IN SAN DIEGO COUNTY
SAN DIEGO- I have to admit to being wrong when I wrote in April that I did not feel the expiration of the tax credit was going to have much impact on the real estate market that makes up most of my business.
While I do not have data to back up my beliefs, I do not see the loss of the tax credit having much impact on the markets I serve. There was an article in today’s North
County Times titled ‘BUYING FRENZY; First-time home purchasers rush to take advantage of federal tax credit.” They quoted quite a few people who spoke of the impact on their markets and stated some positive data, but the article looked at the national picture where in many areas $8,000 is a nice chunk of a home purchase. In our area, because the incentive was 10% of the purchase price or $8,000 whichever is lesser, I would say the credit would have had a much greater impact if you could have received $25,000. This would have been more comparable to our market prices versus the $8000 on a national level.- Brian big dummy Long, 4/30/2010
It was approximately the middle of June that I began to feel the coming impact from the expiration of the tax credit and while it did not make much sense to me for reasons coming, the market has slowed tremendously.
At the beginning of this month I wrote a post and had a graph charting the difference between San Diego resale home sales in 2009 versus 2010. 2009 clearly showed the traditional pattern of increasing home sales as we move into the summer months. 2010 on the other hand showed a significant spike in closed transactions in May followed by an approximate 30% reduction in sales in June. Looking at home sales to date, 7/21/2010, that number looks like it is going to fall further with only 762 home closed in the same market area from the prior survey. At this pace of 38 closed transactions per day, we should expect a monthly total of 1190 closed real estate transaction for July.
THERE IS GOOD NEWS FOR THE SAN DIEGO HOMEBUYER
In my defense, there are a couple reasons, well one big one anyway, why the current real estate market presents a better opportunity for buyers than in May: MORTGAGE RATES!!
Yes, this week mortgage rates are establishing a new low, and contrary to belief it is not impossible to qualify.
Rates fell last week to 4.59% on an average 30-year fixed-rate mortgage, which is down from 4.69% one week ago and the lowest ever recorded by the trade group since its survey began in 1972. Other measures show that rates continued to fall this week: Zillow’s Mortgage Marketplace quoted an average of 4.37% on Tuesday.- blogs.wsj.com,2010/7/21
Two years ago I had clients willing to give blood to lock mortgage rates under 6%, so these rates represent an incredible opportunity and more so when combined with the fact that home prices are still significantly low.
The other reason is that the ‘tax’ credit in a way hasn’t gone anywhere. In fact credits to buyers, have been around for a long time. The best thing about this particular buyer credit is you can use 100% of it regardless of how much you pay in taxes.
With the tax credit, especially the state credit, if you did not actually have a tax bill(s) that totaled the credit amount, you were not going to realize the full credit. However, as a buyer you have always had the ability to ask for a seller’s credit that would be applied towards you closing costs thus either saving you money or providing you the extra money needed to close your escrow. There are individual guidelines to how much this credit can be and it is generally a percentage, say 3%, of the purchase price. This won’t give you your down payment, but it may preserve your cash so you then meet the lender’s guidelines for necessary reserves.
If you have been considering purchasing your first home or an investment property you have a trifecta in your favor. Low mortgage rates, depressed pricing and increased inventory. Give me a call or shoot over an email and let’s discuss your particular needs.
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Put my award winning marketing to work for you
June 26th, 2010 Categories: Client Testimonials, Real Estate News, San Diego county Real Estate News, Triathlon Club of San Diego Race Reports, What to do in San Diego
SAN DIEGO- I received an email yesterday from a member of the Triathlon Club of San Diego who 
works in public relations letting me know the Vflyer template design I created for my listings was named the custom theme of the week.
“It’s official: summer is here! To ring in the new season, we’re spotlighting a very summery custom theme this week from Brian Long of Sea Coast Executive Properties in sunny Encinitas, California. Brian’s custom theme says summer to me: the bright blues and yellows, the sun-and-sea feel of the branded header, and the sand like page background he uses. This is the vFlyer equivalent of a trip to the beach. It’s a well-integrated theme that, like most of the other great themes we’ve featured, prominently 
displays the most important information in the header.
Great job, Brian, and thanks for bringing a bit of SoCal sun to us up here in the foggy Bay Area.”- vflyer blog, 6/25/2010
Call me at 760.415.3329 to put my extensive ‘award winning’ marketing to work for you!! To commemorate this acknowledgement, from today until the end of July, 2010, I will discount the listing side commission on any non-short sale home $300K and above to 1.5%. Call me for further details.
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Hwy 5 widening coming to North County?
June 4th, 2010 Categories: San Diego County Community News, San Diego county Real Estate News
CARLSBAD- I have a client that has been considering a home in Encinitas that is relatively close to the highway 5. In an email today they asked if I saw the article in the newspaper regarding plans to widen the freeway from the 5/805 merge to the Oceanside harbor.
I had saw the article and have heard about this plan for several years now. I actually attended a community forum in 2006’ish and left there with no new information as everything was conceptual. They truly had no answers to most questions.
The community forum meetings regarding this improvement started in 2004 and in 2006, the project was expected to cost approximately 1.1 billion dollars.
The $1.1 billion project would expand I-5 from eight to 14 lanes and would add new car-pool lanes from La Jolla to Oceanside. Widening the 26-mile stretch of freeway from Mira Mesa Boulevard at Interstate 805 and Genesee Avenue to Vandegrift Boulevard at Camp Pendleton isn’t expected to begin until 2009 and wouldn’t be complete for at least five years.-NCTIMES, March13,2006
Unfortunately, the price tag for the San Diego freeway widening project has more than tripled and may cost as much as 4.5 billion dollars according to the San Diego Union Tribune article.
While I realize that there is money allocated for this project through special half cent sales tax, the project will need additional state and federal funds which can be huge problem given the current state of their respective budgets. The state of California is having trouble funding 
education and keeping basic services open five days a week.
What would be great to see would be making our local communities more livable thus reducing the need to drive to other areas for services, entertainment, retail, jobs, etc. I experienced a dramatic shift in traffic conditions when gas hit $4.00 a gallon. It was apparent many people thought about their driving habits.
I also notice the impact UCSD has on traffic on the 5. You know when school is out for breaks and when it starts in the fall. It’s too bad we can not figure out better mass transits to destination location such as UCSD and the Del Mar fairgrounds. There has been discussion about a seasonal Coaster platform at the fairgrounds. We could incentivize the use of mass transit with special admission pricing for those that take the coaster. There could be a dedicated gate for use by Coaster passengers only.
Californians and their cars.
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MORTGAGE RATES HITTING RECORD LOWS!!!
May 24th, 2010 Categories: Real Estate News, San Diego county Real Estate News, San Diego homes for sale
SAN DIEGO- In the last 6 to 8 weeks there had been quite a bit of talk regarding the potential rise of San Diego mortgage interest rates throughout this year. Most analyst predicted rates to rise with at or above 6% being the norm by the end of the year. But then the EU turmoil kicked in.
In what can be looked at as the silver lining from other’s misery, the financial crises in some EU countries is having a positive impact on our mortgage interest rates.
Europe’s debt crisis is behind the drop. Nervous investors are flocking to the security of US Treasurys, which pushes down their yield and influences a host of consumer interest rates—including those on mortgages.-cnbc.com
Just how much impact are these troubled times having on our mortgage interest rates? How about the LOWEST 15 year mortgage rates, 4.24%, since Freddie Mac began doing its rate survey which started in 1991.
The 30 year no point mortgage was quoted last Friday at 4.86% which is the lowest benchmark rate recorded by BANKRATE.com since they started 
tracking the data in 1985. For those willing to take the gamble, many in the mortgage industry predict that rates may bottom out in the mid 4% range this summer.
"It’s schizophrenic. We all had this expectation of higher interest rates and no more refinances." He says he helped a borrower lock in a 30-year loan with a 4.25% fixed rate last week, the lowest in his 24 years in the business.-Jeff Lazerson, chief executive of Mortgage Grader
Yes the federal tax credit has ended, but this is a great opportunity to secure financing that will benefit you for years to come. It is still a great time to be a buying real estate.
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If it sounds to good to be true….
May 15th, 2010 Categories: Real Estate News, San Diego County Community News, San Diego County Fixer of the Week, San Diego county Real Estate News, San Diego homes for sale
SAN DIEGO- I do not know how many times I have had to explain to a client that the price they see listed on a short sale is not necessarily ‘real’ and that they still need to consider the comparable property values. When the news is screaming about how depressed the real estate market is it is EXTREMELY difficult to convince a client that they need to pay MORE than the asking price.
Often homes that are being sold short are listed well undervalue. The listing agent uses the fact that they do not have access to the decision maker, the bank, in order to determine what the bank will accept. I understand this and realize ‘short sales’ are a pain in the neck, but there is being realistic in your pricing and there are times when pricing is just irresponsible.
Take the home pictured as example. It was originally listed at $280,000, which would be the deal of the century. The listing agent priced it almost 50% below what the bank determined was the value of the home and they are now waiting on an offer at or close to $410,000.
If you are currently looking to purchase a home(call me), you do need to investigate and consider short sale listings. However, please take a look at the comparable sold homes and try to be realistic in your expectations. The bank will be doing there due diligence to determine market value of the property so they do not make blind decisions. If you have to write an offer $100,000.00 over the asking price don’t worry about it if you really want to try to get the home and the value is there.
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Encinitas Sports Festival and Triathlon
May 13th, 2010 Categories: San Diego County Community News, San Diego County Triathlon Race Reports, San Diego county Real Estate News, Triathlon Club of San Diego Race Reports, What to do in San Diego
ENCINITAS- Once again Encinitas plays host to the county’s runners, cyclists, paddlers and triathletes with this and next weekend’s Encinitas Sports Festival and two sports festival expo featuring 40+ booths full of the latest in sports, fitness and health.
The weekend of the 15th and 16th is all about the beach starting with a 5K run on Saturday morning starting at the Moonlight beach parking lot, which is also the site of the expo. Also on Saturday will be the 3 and 6 mile Encinitas ocean paddle competition with 6 divisions.
On Sunday, the triathletes and swimmers get their day with a sprint triathlon and 1 mile ocean swim. The Encinitas triathlon features two distances. The sprint distance race, 750m/20k/5k, or the super sprint, 375m/10k/2.5k or for those that are not swimmers, there is the duathlon option which is a 1.5k beach run, a 10k bike leg and then a 2.5k run.
The following weekend, Saturday the 22nd, the cyclists have their day with the San Diego Century Bicycle Tour. This event, starting at Mira Costa College’s San Elijo campus in Encinitas features three distance rides of 37, 66 or 103 miles which takes participants east to Ramona. A great feature of this event is the organizers commitment to the environment making this a green ride. Their efforts include, but are not limited to;
Recycle and correctly dispose of all event waste Avoid use of plastic bottles, bags and containers Arrange for surplus food and clothes to be donated to local organizations for re-use Work to make all rider benefits re-usable incent riders to participate by arranging benefits; i.e.; preferred parking for share rides; discounts for riders who “ride in-ride out”. Register, support and work with local Environmental Organizations
So whether you bike, run, swim, walk, paddle or volunteer, the Encinitas Sports Festival has something for everyone.
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Life after the home buyer’s tax credit
April 30th, 2010 Categories: Real Estate News, San Diego county Real Estate News, San Diego homes for sale
SAN DIEGO- Well I woke up this morning to sunshine and Dave my golden retriever wanting to go for a walk. Obliviously neither knew the opportunity to take advantage of the $8000 home buyer’s tax credit ended overnight. Maybe it was they knew the state of California’s home buyer tax credit of $10,000, or 5% which ever is lesser, was kicking in, but either way, the world did not end overnight and I do not expect it to as it relates to my business.
Firstly, if you have any plans of taking advantage of the $10,000 tax credit offered by the state of California you should hurry. Most everything I have read predicts the funds for this credit will be gone by the end of May. This is certainly no reason to buy a house, but if you are in escrow and can close early, you may give taking that action strong consideration. Closing the day after the funds run out would stink. If you are already in escrow, read the link above and send in your application now.
Taxpayers may apply for the tax credits if they have entered into a contract before May 1, 2010, as long as escrow closes on or after May 1, 2010.
Also, there is a military exemption to the federal home buyer’s tax credit that is often not mentioned and with numerous military installations here is certainly worth highlighting.
The one exception is for members of the military, foreign service, and intelligence communities, who have served on official extended duty outside of the U.S. for 90 days or more between January 1, 2009, and April 30, 2010. They have until April 30, 2011, to sign a sales contract, and until June 30, 2011 to close.
While I do not have data to back up my beliefs, I do not see the loss of the tax credit having much impact on the markets I serve. There was an article in today’s North County Times titled ‘BUYING FRENZY; First-time home purchasers rush to take advantage of federal tax credit.” They quoted quite a few people who spoke of the impact on their markets and stated some positive data, but the article looked at the national picture where in many areas $8,000 is a nice chunk of a home purchase. In our area, because the incentive was 10% of the purchase price or $8,000 
whichever is lesser, I would say the credit would have had a much greater impact if you could have received $25,000. This would have been more comparable to our market prices versus the $8000 on a national level.
Now there already are some indications that some softening in pricing is already occurring. The Case-Shiller index for February was recently released and the San Diego region was the only region to post pricing gains out of the entire index. So is this a national trend that will not impact us locally? That’s hard to say, but I am starting to see more ‘traditional’ listings coming on the market with reasonable expectations. With the summer buying season coming we may weather the next several months well. We’ll need the help of low mortgage rates, which I feel have always influenced our market more than the tax credits, and have a commitment from the FED to keep them low, but there will be some upward movement.
Lastly, what could be the start of a positive trend to drag us out of our real estate bottom is the increase in the San Diego county population. More bodies means more housing demand and whether it is in the rental sector or ownership this is statistic generally translate in to home price appreciation. The San Diego Union Tribune, which I subscribe to, reported a 1.2% gain from 2009 to 2010.
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Mortgages rates are a bouncing ball
April 18th, 2010 Categories: Client Testimonials, Real Estate News, San Diego county Real Estate News, San Diego homes for sale
SAN DIEGO- In my ‘Keep Mortgage Rates In Perspective’ series, after several weeks of mortgage rates creeping up, they have adjusted back down into the low 5% range. However, the consensus is they will be still be moving up throughout the year settling near 6%.
"After rising for four consecutive weeks, mortgage rates eased back to where they
were two weeks ago and still remain historically low," said Frank Nothaft, Freddie Mac vice president and chief economist, in a news release.
But rates will rise in the future, some say.
The recent rise in rates "probably isn’t over, if in temporary retreat," said Keith T. Gumbinger, vice president for HSH Associates, a publisher of consumer-loan information-online.wsj.com
It appears that the current mortgage rate decrease may be tied to the fraud charges of Goldman Sachs which saw over a 12% decrease in its share price last week. How did this effects rates? Investors have pulled money out of the stock market out of volatility fears and moved their money into Treasury notes which are a more secure investment. Because of the increased demand for the notes, the FED does not have to offer as high an interest rate to get buyers. This decreasing interest rate is said to have impacted the mortgage market.
RATES SLIDE: Interest rates fell in the Treasury market Friday after the government filed civil fraud charges against Goldman Sachs for its dealings in the subprime mortgage market.
THE CONCERN: Investors fled risky assets like stocks and pushed into Treasury’s after the Securities and Exchange Commission said that Goldman didn’t disclose that a client helped to create and then place bets against subprime mortgage securities that Goldman sold to investors.
SEEKING SAFETY: The yield on the benchmark 10-year Treasury note maturing in February 2020 fell to 3.77 percent from 3.84 percent Thursday.- Associated Press
Now, without causing a panic for buyers as there is no greater purchase than your first home, the landscape will be changing with increasing mortgage rates and the loss of both the Federal and State’s tax rebates tied to real estate.
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Keeping mortgage rates in perspective
April 8th, 2010 Categories: Real Estate News, San Diego County Community News, San Diego county Real Estate News, San Diego homes for sale
SAN DIEGO- Holy smokes, you’d think that mortgage interest rates trajectory over the last week is something comparable to the liftoff of the space shuttle!! Look at this headline from Bankrate.com, but read the accompanying information.
Mortgage rates soar to 5-month highs
The benchmark 30-year fixed-rate mortgage rose 12 basis points this week, to 5.35 percent, according to the Bankrate.com national survey of large lenders. A basis point is one-hundredth of 1 percentage point
Now this is a key sentence; A basis point in one-hundredth of 1 percentage point. So the 12 basis points is 12 one hundredths of a percent. That’s not even close to soaring in my book!! Additionally, if you continue on with their article there is this handy little chart to illustrate the enormity of the impact this is going to have on the consumer. If you are getting a $165,000 mortgage, the SOARING interest rate will impact your payment by roughly $12.00!!!
Now I realize there are few $165,000 mortgages being written in San Diego, so let’s look at the difference of payments would be on a loan of $400,000.
According to mortgagecalculator.com a loan of $400,000 at 5% would have a monthly payment of $2174.29. That same loan amount at 5.3% would be 2221.22. That’s less than $50/month or 2.6%. Now I understand fifty dollars is fifty dollars, but when it is less than 2.5% I do not see this as a jump, leap or soaring. It’s simply rates are going up from historic lows.
If you would like to see rates soaring, take a look at the graph paying attention to the time between 1977 and 1981.
On the good news front, and why I believe there is not a trend developing here, is the fed realizes the importance of maintaining interest rates at or near current levels. Chairman Bernake discussed this on Wednesday and the vice chairman reiterated this view today.
Echoing remarks on Wednesday by Fed chairman Bernanke, Fed vice chairman Donald Kohn on Thursday said a gradual U.S. economic recovery marked by high unemployment
and tame inflation will require interest rates to remain very low for an "extended period".
The Fed’s promise to keep rates low is contingent though on economic conditions such as an absence of strong private demand and a reluctance by businesses to hire, Kohn indicated.
"We cannot provide a precise timetable for when short-term interest rates will begin to return to normal because that depends on the evolution of actual and projected activity and inflation," Kohn said in a speech to a luncheon sponsored by the Federal Reserve Bank of San Francisco- reuters.com
Oh and by the way, rates today tumbled
to 5.21%.
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