Aaron Cullen : Folsom & El Dorado Hills Real Estate

Latest News and Topics of Interest: The rapid decline in long-term interest rates continued in December. Due to continuing actions by the Federal Reserve board, according to FreddieMac.com, the average cost of a 30 yr. fixed mortgage in the Western U.S. has dropped from 6.47% on 11/1/08 to 5.60% on 12/1/08 to 5.01% on 1/1/09. "Word on the street" is still suggesting 30 yr. mortgages at 4.50%, or less, soon. On the horizon: Expect Obama's stimulus package to include a provision, empowering bankruptcy judges with the ability to alter home loans in an effort to prevent foreclosures. The purpose of this is to get lenders to further engage in loan modifications and short sales, or the courts will do it for them.

National & Regional Snap-shot: What a difference a year makes: 1,872 homes sold in Sacramento County last month, a 219% increase in home sales when compared to December 2007. Of the 1,872 sales, 1,371 were bank owned (73%), 197 were short sales (10%) and the median home price rose 10% from $181k in November to $199k in December. 83% of the county's home sales were "distressed," making stiff competition and low odds of success for the average home seller.

Folsom: Folsom closed out 2008 with 50 home sales in December, including 21 foreclosure and 7 short sales. The inventory of homes available dropped to a low for the year to 239 homes. December had the highest percentage of distressed home sales for the year at 56%. The average home sales price dropped to $388,718, a 20% decline from the December, 2007 average. The average dollars per square foot fell to $189, a 13% drop from December, 2007.

Aaron's take on the markets: Reflecting on 2008, we saw a big drop in the stock market, employment, investor morale, consumer confidence and home prices. All of these factors helped the bottom fall out of the housing market in 2008, to the tune of a 20%+ decline in home values. Time is needed for all the government stimulus and falling interest rates to do their job, but when they do, the credit markets will loosen and home buyer confidence will rise. Although I do not see runaway appreciation returning, I do think we'll see prices stabilize in 2009. Considering falling interest rates, the tax benefits and possible appreciation, if you can find a home you love, and plan to stay 3+ years, early 2009 could be a great time to buy.

Personal note: I had the opportunity to see many of you over the holidays and I enjoyed the time. With the new year upon us, opportunity is abound and my nose is back to the grind-stone. If you ever want to chat, please give me a call.

National & Regional Snap-shot: The election has come and gone and the national focus has returned to the economy, the credit crisis and the slumping housing market. The roller coaster ride continued with 30yr fixed mortgage rates rising from 6.07%* at the beginning of October to 6.47%* at month's end. No sooner than Paulson and Bernanke talked voters and Congress into the "mortgage bailout," it evolved (was switched) to a different plan of injecting money directly into banks and other financial institutions as opposed to buying mortgages through reverse auctions. Officially, $125 billion was given to the nations 9 largest banks with another $125 billion slated to be injected into smaller banks across the country. From a regional standpoint last month, 2,084 homes sold in Sacramento County, 1354 were bank owned (70%), 205 were short sales (10%) and the median home price rose 1% from $192k in September to $194k in October.

El Dorado Hills: Sales in El Dorado Hills did not change much, dropping from 66 in September to 64 in October. The number of "distressed sales" fell in both categories with 17 bank owned homes (26%) and 6 short sales (9%). The average sales price increased from $528k last month to $570k in October. The supply of homes dropped from 378 in September to 374 in October. Despite the credit crisis, and volatile interest rates, homes are continuing to sell.

Aaron's take on the markets: The real estate markets continue to be influenced by the credit crisis and foreclosures. Unemployment filings are on the rise, which will also pressure home prices. The expectation is, home prices will continue to soften in the coming months with the key to stabilizing the markets being stopping bank foreclosure liquidations. Banks such as Bank of America, JP Morgan, and Citibank have all recently announced they will seek out borrowers who are in trouble and offer to rework their loans. Problem is, unless you are behind on your payments and your loan amount is 90%+ of your homes value, there may not be any help available to you. If you are thinking of buying or selling, let's chat.

Personal note: On November 4th, voters across the country helped make history by electing the first African American to be our president. Without any political bias being offered, I think we as Americans have come a long way and we have officially entered the 21st Century. Congratulations to those who supported and voted for Barack Obama.

Have a great Novermber and Thanksgiving! Aaron Cullen, Brokers Inc. Residential Real Estate

National & Regional Snap-shot: The election has come and gone and the national focus has returned to the economy, the credit crisis and the slumping housing market. The roller coaster ride continued with 30yr fixed mortgage rates rising from 6.07%* at the beginning of October to 6.47%* at month's end. No sooner than Paulson and Bernanke talked voters and Congress into the "mortgage bailout," it evolved (was switched) to a different plan of injecting money directly into banks and other financial institutions as opposed to buying mortgages through reverse auctions. Officially, $125 billion was given to the nations 9 largest banks with another $125 billion slated to be injected into smaller banks across the country. From a regional standpoint last month, 2,084 homes sold in Sacramento County, 1354 were bank owned (70%), 205 were short sales (10%) and the median home price rose 1% from $192k in September to $194k in October.

Folsom: Home sales rose from 49 in September to 64 in October. Compared to last month, sales increased by 31%, and when compared to October 2007, sales also increased by 31%. There were 21 bank owned home sales (33%) and 8 short sales (12.50%). The biggest change in Folsom was the number of short sales, which doubled from last month, suggesting the banks are making a bigger effort to sell homes prior to foreclosing. The average home price dropped from $439k last month to $422k in October. The total supply of homes rose from 259 on 10/1/08 to 284 on 11/1/08.

Aaron's take on the markets: The real estate markets continue to be influenced by the credit crisis and foreclosures. Unemployment filings are on the rise, which will also pressure home prices. The expectation is, home prices will continue to soften in the coming months with the key to stabilizing the markets being stopping bank foreclosure liquidations. Banks such as Bank of America, JP Morgan, and Citibank have all recently announced they will seek out borrowers who are in trouble and offer to rework their loans. Problem is, unless you are behind on your payments and your loan amount is 90%+ of your homes value, there may not be any help available to you. If you are thinking of buying or selling, let's chat.

Personal note: On November 4th, voters across the country helped make history by electing the first African American to be our president. Without any political bias being offered, I think we as Americans have come a long way and we have officially entered the 21st Century. Congratulations to those who supported and voted for Barack Obama.

Have a great Novermber and Thanksgiving! Aaron Cullen, Brokers Inc. Residential Real Estate

National & Regional Snap-shot: The presidential election and Hurricane Ike became after thoughts in September as the credit crisis on Wall Street spread to Main Street. The hope for an election year rally in the stock market has been put on hold, as the Federal Reserve and Treasury Department have scrambled to utilize every tool in their arsenal (including getting congress to authorize a $700 Billion bailout) to calm the markets and keep the American economy flowing. From a regional standpoint last month, 1934 homes sold in Sacramento County, 1354 were bank owned (70%), 200 were short sales (10%) and the median home price dropped another 11% from $215k in August to $192k in September.

Folsom: Seasonal slowness in Folsom dropped sales from 67 in August to 49 in September. However, when compared to September ‘07, home sales increased by 136%. "Distressed home sales" more than doubled from August '08 with 19 bank owned home sales (40%) and 4 short-sales (8.50%). Over the past year, foreclosure sales in Folsom increased 850%. The biggest change in Folsom from August '08 to September '08, was a more than 50% increase of bank owned homes available for sale. The total supply of available homes dropped from 280 on 9/1/08 to 259 on 10/1/08.

Aaron's take on the markets: The national, regional and local markets continue to be influenced by bank owned homes. Banks continue to liquidate their inventories, putting downward pressure on home prices. If you have to sell your home in the next year, I would suggest moving quickly and pricing it at, or slightly below, the market. If you don't have to sell, then now is not the time to test the waters. The good news is, it is an excellent time to purchase a home. Prices are relatively affordable and interest rates remain low. If you are looking to upsize, sell your home quickly, then get a great deal on your dream home! Real estate always moves in cycles, and so far, this cycle has not bottomed. When financing becomes easier and repo's subside, prices will stabilize and the recovery will begin. The big questions are: Will the bail-out of Wall Street work? Will our government help "upside-down" home owners stay in their homes? Will the Paulson Plan some how stop foreclosures all together? Stay tuned...

Personal note: I just listed a beautiful home for sale at 1042 Houston Circle in The Parkway in Folsom: $439k. This 1-story home is in excellent condition and ready for a new family. 4 Bed, 3 bath, 3 car-garage, 2,250 s/f. Please tell a friend!

Have a great October! Aaron Cullen, Brokers Inc. Residential Real Estate

National & Regional Snap-shot: The presidential election and Hurricane Ike became after thoughts in September as the credit crisis on Wall Street spread to Main Street. The hope for an election year rally in the stock market has been put on hold, as the Federal Reserve and Treasury Department have scrambled to utilize every tool in their arsenal (including getting congress to authorize a $700 Billion bailout) to calm the markets and keep the American economy flowing. From a regional standpoint last month, 1934 homes sold in Sacramento County, 1354 were bank owned (70%), 200 were short sales (10%) and the median home price dropped another 11% from $215k in August to $192k in September.

El Dorado Hills: El Dorado Hills was a bright spot last month with the sales rising from 50 in August to 64 in September (unusual to see this type of reversal in September). The "distressed sales" theme continued in EDH with 22 sales (33%) being bank owned and 11 sales (17%) being short-sales. The supply of homes for sale dropped from 401 on 9/1/08 to 378 on 10/1/08. Serrano continues to be the neighborhood of choice for banks liquidating homes at below market prices. Inside scoop: If you aspire to live in Serrano, due to all of the foreclosures, there are excellent, rock-bottoms deals available under $135 per square foot.

Aaron's take on the markets: The national, regional and local markets continue to be influenced by bank owned homes. Banks continue to liquidate their inventories, putting downward pressure on home prices. If you have to sell your home in the next year, I would suggest moving quickly and pricing it at, or slightly below, the market. If you don't have to sell, then now is not the time to test the waters. The good news is, it is an excellent time to purchase a home. Prices are relatively affordable and interest rates remain low. If you are looking to upsize, sell your home quickly, then get a great deal on your dream home! Real estate always moves in cycles, and so far, this cycle has not bottomed. When financing becomes easier and repo's subside, prices will stabilize and the recovery will begin. The big questions are: Will the bail-out of Wall Street work? Will our government help "upside-down" home owners stay in their homes? Will the Paulson Plan some how stop foreclosures all together? Stay tuned...

Personal note: I just listed a beautiful home for sale at 1042 Houston Circle in The Parkway in Folsom: $439k. This 1-story home is in excellent condition and ready for a new family. 4 Bed, 3 bath, 3 car-garage, 2,250 s/f. Please tell a friend!

Have a great October! Aaron Cullen, Brokers Inc. Residential Real Estate