Every year at this time, I begin thinking about writing a little holiday newsletter to go into cards I send out to my past clientele, and other contacts. Yesterday, a close friend of mine, found this one I had sent to her via email 5 years ago. It is interesting to look back to 2003, and revisit our thoughts on how the housing market was doing, and wonder about the direction it would take. I have reposted it below. What a difference 5 years makes.
_______________________________________________________
Hi -
It's difficult to believe we are once again at the end of another banner real estate year.
The Golden State's housing market seems to belie the long-standing maxim that for home sales to sizzle; so must the job market.
In a widely watched employer survey, the state reported last month that payroll employment in the Sacramento region and statewide had fallen below 2002. In the region encompassing Sacramento, Placer and El Dorado counties, for example, the survey showed a loss of jobs compared to last year.
But some economists contend nowhere near enough homes were built over the past five years to meet the demand created by huge employment gains statewide. Estimating the shortfall in the hundreds of thousands of units, they say homes being built today are still satisfying that leftover demand, helping to explain how home sales could be so strong when job creation isn't.
In addition, the housing market is feeding off the lure of low mortgage rates, which help more first-time buyers qualify for a loan, and for existing owners to tap big equity gains to move up to a better house.
In the Sacramento area, robust population growth and Bay Area transplants -- including telecommuters and super-commuters who make the long haul daily -- add substantial demand for housing here.
Some experts contend that continued concerns in the integrity of the stock market, has prompted many people to conclude housing is among their safest investment bets. The percentage of homes purchased by investors looking to rent them out has risen locally and statewide in recent years, though it remains below levels seen just before the housing market tanked in the early 1990s.
Explanations as to how home sales could be so strong absent a big rebound in the job market, a minority of housing analysts, believe prices are rising on a speculative bubble prone to bursting. That would mean prices are likely to tumble.
If there is a bubble, however, it's certainly proved itself resistant to pinpricks, such as the uncertainty cast over the housing market by official talk of big state worker layoffs, the war in Iraq and the lackluster performance of the job market.
The bubble theory is out there, and it's not wholly unbelievable, but given it hasn't burst yet ... it looks more like it was just the lack of building over years and years that's led to much of the housing market's strength this year.
While most economists and analysts don't anticipate a crash, many say they'll be far more concerned if home price appreciation doesn't cool in the next six months. They say prices are approaching levels that aren't sustainable based on household incomes, employment levels and limitations on how much a home could fetch in rent, among other factors.
This coming year will mark my 23rd year as a Realtor. Some of you receiving this will be among my very first clients. Each face, each experience and each relationship built from my association with you is treasured. I continue to look forward to working with you and your families in the future.
With sincere hope, I wish for you and your loved ones, to have the most joyous of holiday seasons.
Sincerely Yours,
Myrl Jeffcoat, Realtor
Recently a real estate agent was lamenting about a couple "For Sale" signs on a home in her community. It had previously been a well-kept property, but now appeared a little more ragged around the edges.
A real estate "For Sale" sign was hanging from the traditional post planted on the front lawn. But a smaller sign hung around the neck (or bow) of "The Unforgiven" - a large boat, moored in the driveway.
Curious about the property, the agent searched the MLS for the listing, while checking price, amenities, condition, and financing terms. It was noted, the home had a pool in the backyard, and an updated kitchen. The listing also had something extra - It was listed as a "short-sale."
Clearly this listing is just one of many acting as an illustration, of how we arrived here - from there. During the boom years of housing, many folks witnessed home values rise dramatically. Homeowners were taking out equity, and plunging funds into other amenities - a pool, kitchen upgrades, vacations. And one homeowner even acquired a boat, named "The Unforgiven."
In recent months, we have come to realize, that not only has Wall Street been exhibiting drunkenness, but Main Street has too. We can only hope the hangover won't be long and protracted.
Both our presidential candidates chant a mantra of CHANGE. Change can be good, but change is only raw energy. Whether it is manifested into good or bad, depends on those with the power, and the capacity, to harness it, to move us forward in a positive way.
Perhaps change will have us going back to solid basics - and certainly that can't be a bad thing.
Every year at this time, there is a special place along Highway 50, at a place cradled in the arms of the Sierra Foothills that comes alive. In Autumn when the fruit comes into harvest, and the cider is pressed, Apple Hill provides delight for all.
Originally, Apple Hill was a collection of approximately 16 ranches or orchards. Today it boasts more than 50 ranches including Christmas tree growers, wineries, a micro-brewery, Spa, vineyards, and pumpkin patches.
Apple Hill is located in El Dorado County - approximately 4 miles east of Placerville. There is easy access from highway 50.
This link will provide you with a schedule of old-fashioned fun packed activities: http://www.applehill.com
Plan a picnic on the beautiful land that spreads her colorful leaves.
Who has What - and When and Where?
Days and hours of each individual ranch are listed here. For more information on what they offer, see the Apple Hill Guides and Apple Hill Maps Which ranch has which APPLES? Apples & Other Fruit Guide
Have any of you local to Greater Sacramento, Placer, and El Dorado counties, heard about the Fair Oaks Chicken Festival? Old Fair Oaks Village has a population of chickens that pretty much rule the roost, and have the run of streets, shops, restaurants, and the village park. Their habitation of the Village, adds charm and a quaint ambiance to the area.
While other communities like Gillroy may have it's Garlic Festival, or while Isleton lays claim to the Crawdad Festival, Fair Oaks has it's Chicken Festival. And the public is invited.
On Friday, September 19th there will be a BBQ. And on Saturday September 20th, The Third Annual Fair Oaks Chicken Festival will be going full bore with a litany of activities, and fun.
Here is a link to the Fair Oaks Chicken Festival website. Take a visit, and see what's available for local fun:
The California Association of Realtors reported today, that California's free-falling home prices sparked a fourth straight month of year-over-year sales gains during July.
Jim Wasserman of The Sacramento Bee, has a more detailed report on the numbers of state wide home sales statistics in California, and collective California price reduction data.
The article is linked below:
http://www.sacbee.com/749/story/1184910.html
The month of July also demonstrated dramatically increased number of home sales for Sacramento as well - while prices declined for the same time period.
 |
|
|
Realtor since 1981 - Whether your real estate needs are entry or executive level, I have the experience to give you the professionalism, you deserve. Sacramento, El Dorado and Placer Counties
I am a life long resident of the Greater Sacramento area, and have been a Realtor since 1981. Whether your real estate needs are entry level or executive level, I have the experience to give you the professionalism, you deserve. If you are currently thinking of buying or selling a home, please give me a call. I will be happy to assist you with any real estate needs you have. Great West GMAC Real Estate is also an excellent relocation resource. Should your move be local or global, I have the resources to give you the best assistance possible.
Califronia DRE License #00827565
Residential Property Specialist in the Counties of Sacramento, El Dorado and Placer
Short Sales - Advantages and Pitfalls
Looking back a few years, when the over-exuberance of the housing boom was being partially fed by the first ingredients of the sub-prime debacle, it was difficult to foresee in this present day, we would be ramping ourselves up to speed on "short-sales."
As many GreatWest GMAC Real Estate Professionals understand, "short-sales" can be anything but short in the process of negotiation with Banks, Mortgage Insurers, Sellers, Buyers, and ALL entities prevalent and present in a hoped for sale.
"If" a mortgage lender has agreed to allow "short-sale" on a property, and the home does become available to the market, it CAN BE an advantage for all. T. Sami Siddiqui, Broker-Owner of Great West GMAC, states, "Owners usually need to sell quickly, and though there will be no profit to the Seller, there is hope of salvaging some of their credit rating from such a transaction."
The Buyer is hoping to get a steal. The Bank is hoping to avoid being forced to foreclose, because the foreclosure process can be very expensive for the bank to endure. Some estimates have put the figure at approximately $40,000 per foreclosed property. However, the bank must get fair price.
However, among the entities with interest in the property, from one perspective or another, it often isn't as easy to get a short sale pushed through the lender (and others) as most folks would think - or hope!
To provide an example - A GreatWest GMAC Real Estate Professional recently spoke with a client, who came from another part of the state, and had failed in the process of trying to acquire a "short-sale" property there. The client had became understandably overwhelmed and frustrated from trying to get his offer accepted to facilitate the purchase, and had failed in the attempt. The process, culminating in ultimate failure, had taken 12 weeks.
The Seller was glad to have the Buyer's offer, because the Seller needed to move across country - but owed more on the home than it was now worth. However, the Seller continued to be current on mortgage payments.
The Buyer made a full price offer for the "short-sale" property.
The Seller immediately signed acceptance of the offer, without countering. The Seller's acceptance was subject to Bank approval; and that is when the clock began ticking for the next 12 weeks, with numerous roadblocks along the way.
The bank "sat" on the "seller accepted offer" for what seemed to be an unusually long time before agreeing to the sale itself.
During this time, the property continued to remain on the market, and other offers did come in. The Buyer, who by now had become emotionally attached to the house, more than once found himself in re-negotiation and experiencing increases of price for the property, while a small bidding war ensued.
Once the Bank accepted, the acceptance was still subject to an appraisal. The property was appraised $4,000 above the price of the accepted offer.
There can be this little dance that ensues with all the entities involved in the "short-sale" property.
If the Seller is current on payments, the Bank isn't too motivated to act quickly to take a hit on the value of the existing mortgage balance. This becomes more critical if there is Mortgage Insurance (PMI or MIP), which insures the Bank against default of the mortgage by the Seller.
However, if the Seller becomes delinquent in payments, the Bank may be more interested in negotiating actively in the short-sale process, because they likely hope to dodge the bullet of foreclosure.
However, if there is PMI or MIP on the property, this may lengthen negotiating the "short-sale" among the interested parties, and the PMI or MIP Company, will often become a participant in negotiations.
Once ALL parties are engaged in negotiation, each party is hoping to come to an equitable solution, where they aren't required to eat more of the decline in value of the property, than need be, in order to facilitate a successful transaction on the property.
There are advantages and distinct pitfalls in negotiating short-sales. GreatWest GMAC Real Estate Professionals are trained and experienced in this process. If you have further questions not addressed in this article, please allow us to assist you with your interest in this topic.
If you are a Homeowner, considering marketing your home through the "short-sale" process, please contact us. Also there are income tax consequences with "short sales" and Sellers are encouraged to consult their accountant about the ramifications of the "short-sale" process.
Written for GreatWest GMAC
by: Myrl Jeffcoat
ActiveRain Corp. is not responsible for the accuracy of the site's content (which is written by members of the ActiveRain Real Estate Network) and does not endorse the views of the real estate agents, mortgage brokers, and others listed here.
Powered by the ActiveRain Real Estate Network
© 2009 ActiveRain Corp. All Rights Reserved
