April Home Sales Up

Interesting article about the uptick in the nation wide market.
Locally, things are changing. The sales per day is increasing and the inventories are being reduced.

Mortgage rates have been ticking up since the first of the year with inflation worries.

All in all, property values are down - we've been buying $350K houses in San Jose! and $160K houses in Merced - that actually break even.

Also, still got investors in DallasForeclosureFinder.com - there is competition between bidders! So, the saavy investors are still there.

Treasury Chief Says Worst May Be Over - AOL Money & Finance

<cite>Treasury Chief Says Worst May Be Over - AOL Money & Finance</cite>: "

Treasury Chief Says Worst May Be OverBy JEANNINE AVERSA and MARTIN CRUTSINGER,APPosted: 2008-05-07 15:47:35Filed Under: Recession WatchWASHINGTON (May 7) - The worst of the credit crisis may have passed, Treasury Secretary Henry Paulson said Wednesday, while acknowledging that rising gas prices will blunt the effect of 130 million economic stimulus checks. He ruled out a second stimulus package for now.

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Square Feet: California builders squinting at a market bottom, trade group says

<cite>Square Feet: California builders squinting at a market bottom, trade group says</cite>: "

California builders squinting at a market bottom, trade group saysSue McAllister01:49 PM on Thu, May 15, 2008topic: Economy Home buying Homebuildingrecent related posts: � Housing construction permits dwindled in March � California building industry has 'cautious optimism' for 2008; Bay Area prices 'dead flat,' perhaps masking marble upgrades galore � A home builder that saves your hand from scaldingSales of new homes in California dropped 49 percent in March compared to the same month in 2007, the California Building Industry Association reported today. But that decline was not as bad as February's year-over-year decline of 57 percent, which the trade group said provides 'mounting evidence that the bottom of the current housing cycle is near.'

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PMI is getting harder and harder to find

Got this notice this morning:

May Mortgage Insurance Changes

Due to rapid changes with the availability of Mortgage Insurance coverage, we have added a summary starting on page 5 of Private Mortgage Insurance (Doc 6102). This document has been updated to reflect the changes outlined below.

It's getting harder and harder to get PMI and most lenders have limited/eliminated their second mortgages.

There are still ways to make it happen but, if you are in the middle of a transaction, make sure your lender is on top of the (often) daily changes.

Have you lost a deposit or had a transaction fall through due to last minute underwriting changes?

Location Location Location

I was in a meeting this week when a friend came up and, in that hushed conspiratorial tone asked "How's Real Estate?"

"Gosh, I am busy!" I replied

She didn't know what to do. She literally just stared at me for about 3-4 seconds.

While it's true the money markets are off and it's a bit harder to get a loan than it used to be, It has been SO MUCH worse! It wasn't that long ago that you couldn't get a loan without excellent credit and a decent down payment that you worked really hard to earn.

Of course, that's before the speculators came into the market and took advantage of other people's cheap money. We only have ourselves to blame.

That being said, there are still some great markets in Silicon Valley. This week a friend made and offer on a $1.2M home in Santa Clara with Cupertino schools. They came in $50K over asking price and were out bid by $250K!

What's the market like in your neck of the world?

Yes on 98, No on 99

Today is my birthday - thank you - and I got a call from an old client first thing this morning. I am thinking, "what a great person to call me on my birthday". I pick up the phone and hear, "I have a voting question". Hmm, guess it's not all about me.

There are two eminent domain issues on the ballot. Both restrict eminent domain but there are a few differences. First, Prop 99 only "protects" owner occupied single family homes while 98 covers all property.

I live in a duplex and rent out the front unit. I own and occupy the place but my SFR neighbor would have more rights than me. That just doesn't make sense to me.

Second, Prop 98 doesn't allow "price setting" while 99 does.

Third, Prop 98 protects renters while 99 ignores them.

Property rights are property rights. It shouldn't matter whether it's a shopping center or a single family home. Property rights are one of the guiding tenets that make America great.

Master of None?

I've been doing this crazy real estate thing for 20 years now [am I that old? :-) ]
and I remember being told to find my "niche". The general argument was that you pick one thing and you do it well.

Today I am questioning that philosophy.

My business started off being a loan officer for my friends' brothers' company. I was 25 and married and had a 6 year old to take care of and the flexibility was wonderful. I could take care of my high maintenance child and take very good care of my clients.

After 5 years, the brother changed his business model and eliminated my job - so, I went out on my own [I was a broker by then]. My clients followed me and referred me to all their friends and I found I could make it on my own.

Along the way, I became friends with my clients and they felt comfortable enough to come to me when they had financial or real estate questions. The next thing I knew, they were asking me to represent them on their buys and sells. Then they wanted to buy a bar or their business needed more warehouse space or they needed to buy a office building.

Our kids grew up and moved away and we were all looking for cash flow for retirement. So, we started moving our equity into investments that had a monthly return that we could count on. It's been a joint venture all along the way and it's made for a wonderful life.

So, perhaps you can say I found my "niche". I specialize in people. Good people that I take good care of. Good people that I like and that like me right back.

Yesterday I called a client and got the machine. "hey nutball how you doing?, this is Rebekah" when I heard him pick up the line and say "I knew it was you at Nutball"

Hug Your Realtor Today

I woke up this morning to a voice mail from a Realtor friend that is getting out of the business and moving away. It's almost like, there is so much invested in looking good that when things aren't good they have to move away to save their delicate self worth.

It's tough out there. Most Realtors are feeling the effects of this market. The scary part of that is I remember the Realtors that killed themselves during the dot bomb. So, reach out and touch someone.

The greatest of these is love.

New Tenants

I have a vacancy right now so I was showing a rental to perspective renters this week.

As we wandered through the house, we chatted about the house and what was going on in their lives. Turns out, they had purchased a house a couple years ago. They loved the house, put all their money into updating it and landscaping. They figured they would be there forever.

A year or so in, they were visiting friends in Tahoe and wondered if they could buy a second home. It was at this time that they pulled out their mortgage papers to figure out what they owed on their home. After reviewing the loan statements, they realized they were in a negatively amortized loan AND it would re-adjust within the next few months - raising their monthly payments to over $4000/mo.

These are very responsible parents of teenagers. They have perfect credit and have stable long term jobs. It took them a few months to reconcile their disappointment and consider their options but, they were able to put their home on the market and are currently in contract with expectations of closing by the end of May.

These people relied on their Realtor and Lender and didn't know enough about the process to know the questions to ask.

Frankly, it pissed me off. I have been to signoffs where I read and explained the loan to my clients, they weren't getting what they thought, and we extended escrow to work it out. I've also been to signings where I explained, it wasn't what they thought and they chose to close anyway. Either way it's the clients' decision but, it pisses me off that someone that is working as my agent sells me a book of goods so that they get paid.

I understand that I don't get paid unless we close but, I need to feel like I am helping my clients - first and foremost. I have been in this profession for 20 years and I have clients from 20 years ago. What I don't have is clients that are losing their homes because I didn't review their loan docs.

Before this I thought these people in crappy loans were just stupid or lazy or deserved their fate, somehow. I believe in caveat emptor and personal responsibility. I also believe in full disclosure and taking care of your clients.

Do you know someone that is in a crappy loan? How did they get there and where did the system break down?