Alameda, CA

This question gets asked over and over again. And the answer is, "It depends." This seems like the right time to reiterate that real estate is local.

GENERAL INFO

• Buyers have to qualify for that tax credit that equals 10% of purchase price, or UP TO $8,000.
• On FHA loans, the tax credit can be be PART of, but not THE down payment. See: Who/Where/How/What/When to use the $8,000 first time buyer tax credit with an FHA loan

EXCEPTIONS

But.....but.....yes, there are exceptions ... some state housing finance agencies have developed their own tax credit bridge loan programs, so buyers in states whose HFAs offer such programs can monetize the tax credit upfront to cover all or part of their downpayment.

The reference to the state finance agencies may have been what got folks thinking that the tax credit can be used as the ENTIRE down payment

So what states have already instituted some type of bridge loan?

From this link, it appears that the following states already have something in place:

• Colorado
• Delaware
• Idaho
• Kentucky
• Missouri
• Nebraska
• New Jersey
• New Mexico
• Ohio
• Pennsylvania
• Tennessee
• Virginia

Supposedly, Florida has also passed this bill, but this information hasn't been formalized on NCSHA's site. This may also be in discussion in Califonia where we already capitalize on other programs namely:

WHEN IN DOUBT....

It seems that the only logical thing to do is to go to the main sources of information, especially the IRS.

Next month, friends of mine are relocating to Hawaii for a job promotion and also to be closer to their family who are still in Hawaii.

They asked me to list their house for sale. But upon learning that

1. they got their loans modified
   
2. the value of their home is less than what they paid for and therefore can't be listed a the price they want
3. there are two different lenders, which would make a short sale difficult

....they decided to rent the house for a year while they try to get their loans consolidated and perhaps in a year, sell it. This would have cost tham $1500/month more than what they could get in rent. But they felt they have no choice because short sale is not do-able in the time period they need.

Oh...but there is another choice! Lease-purchase option!

This can be the best of both worlds for both buyer and seller, and is certainly an option to explore.

There areseveral links to lease-purchase option. Here are some that I thought are quite informative and useful to anyone considering this.

• Kudos to Elizabeth Weintraub for her article on How to do a lease purchase
• What is a lease purchase contract?
• Lease purchase features and benefits
• How does a Lease-to-own work?

This woman buys a condo for her brother and sister who unexpectedly die within a year of each other. Later, the woman tries to rent the condo, where the rents barely cover the monthly mortgage and HOA fees.

The HOA slaps her with a hefty fine because under their rules, the quota for rentals is filled, and she can;t rent out the condo to non-family members.

She appeals.

Deaf ears. Closed minds. No compromise.

Since she can't rent it out, she doesn't have any money to pay for the condo and the HOA fees. So she tries to sell the condo as a short sale.

In the meantime, the HOA fees accrue. The HOA attorney sends threatening letters, adds a hefty fine (for previous transgression of renting the condo for a short period of time), and attorney fees.

Condo now has offer, subject to lender approval.

HOA records Notice of Default. Is now threatening Notice of Trustee Sale.

Even if bank approves short sale, bank may not pay for HOA delinquent fees, fines and lawyer charges.

So if HOA forecloses, and after the paying off taxes, who becomes the Owner of Record? The HOA? Does HOA trump the bank? Who gets paid next out of the proceeds from the sale?

Is this a case of letting the house burn>

Just one of the fun things we do at our office...

Usually, for one Friday of the month, we hold a Brown Bag lunch with our broker, during which we discuss events and issues pertaining to real estate. It's an informal roundtable discussion.

However, the brown bag luncheon was scheduled on July 3 when only a few of us didn't take off for the long July 4th weekend.

So last Friday, my broker, Michael Studebaker, of my company, Gallagher and Lindsey in Alameda CA, did something fun: he barbecued pork --- AT THE OFFICE!

He set up a barbecue at an alleyway behind the office, brought the meat and accoutrements. By 11:30 am, as the smell of the barbecue floated, our mouths were watering, our stomachs growling.

So we hurriedly set the tables. Some of us brought the wine and beer. Others brought the artichoke dip and chips. And ALL of us brought the good cheer.

We had a blast! What a wonderful way to unwind at the office. Michael is such an accomplished cook, that he is even looking into having a full kitchen at the office.

This is not the first time we were treated to such foodie events. We've had a Chinese New Year celebration. An Italian luncheon. Several showers and retirement parties. Many "just because we want to" gaherings.

Wish I had pictures of the time we had a chili cook-off, when several of the realtors brought their slow-cookers with their versions of their favorite chili. Then we voted on the best. I don't know what was the most fun: judging the chili, or eating it!

What a fun place to to be!

Like many other cities that have hummed along, Alameda seemed to, as many residents like to say "hold its value." But Alameda is hardly untouched by calamitous economic downturn.

In 2008, the numbers were quite different than where they are today

2008 REO foreclosures: 35 homes, or 8% of 415 homes sold that year.

In 2009, and as of this writing, based on our local MLS figures, here's what's happening in our glorious island of Alameda.

SOLD (closed escrow) LISTINGS since January 1, 2009: 138 Residential homes

• 23 condos
• 12 townhouses
• 5 duets
• 98 detached single family homes
• Average days on market: 53
• Average list price: $574,774
• Average sold price: $556,203 (96.7% of average list price)
• Average sold $/sq ft: $353/sq ft
• 9 short sales
• 26 REOs or bank owned (18.8% of total sales to date --- a 10% increase over last year!). Breakdown as follows:
  
  • 5 condos (highest sold price: $315K for a condo at the Willows, a beach condo complex)
  • 1 townhouse ($408K at Islandia townhouse complex)
  • 19 houses (highest sold price: $738K for a house on the lagoon)

ACTIVE LISTINGS - 134 Residential homes

• 25 condos
• 15 townhouses
• 6 duets
• 88 detached single family homes
• Average days on market: 66
• Average list price: $655,787
• Average $/sq ft: $383/sq ft
• 9 short sales
• 10 bank owned (REO or real estate owned)
  • 4 condos (highest price $314K)
  • 6 detached homes (highest price: $646K on Park St)

PENDING LISTINGS: 90 Residential homes

• 22 condos
• 8 townhouses
• 2 duets
• 58 detached single family homes
• Average days on market: 49
• Average list price: $527,761
• Average $/sq ft: $353/sq ft
• 26 short sales
• 9 bank-owned
  • 3 condos (highest price: $250K)
  • 6 detached homes (highest price: $534K)

From these figures, it doesn't appear that foreclosures slowed down in spite of the federal moratorium on foreclosures. We went from 8.8% foreclosures as a % of total sales in 2008, to 18.8% in 2009 to date.

Recently. a new state law went into effect. Similar to the federal government program in Dec 2008-April 1 2009, this new law mandates that program lenders must prove that they tried to modify delinquent loans before starting the foreclosure process.

But there are concerns about loopholes per San Francisco Chronicle (SFGate.com).

Fasten your seatbelts. It's going to be a bumpy ride.