Rebecca White

Wow, gotta know that I love referrals as that means my clients love me, right?

So I completed a successful short sale transaction in April for a couple. Last week, they referred me to another couple who owned a condominium in an adjacent town. Coincidentally, I had sold a condo in the same complex (and liked the area so well, I considered making the move across the Bay myself.) [To digress, I regrettably invested in a TIC in San Francisco (more later) and was fearful for my cat's safety (he might have chased a goose into a pond!) and truly loved San Francisco too much to move. (The affordability of the East Bay is still enticing, hence my vicarious thrills with many first-time buyers.)]

Back to my story...I asked some questions and ran some quick comps. These young ladies had paid $450,000 for their two-bedroom, two-bath condo in July of 2007 and the most recent sale was for $240,000. Can we all say YIKES!?!!?!!?!??

The good? news is that their mortgage will not adjust for 6 more years and they did get 100% financing. I say that this is "good" news as unlike my other Richmond short sale (still in escrow 3 months later), they are NOT losing any down-payment money. The reason for the short sale is that shortly after the purchase, one of them became pregnant--and they had TWINS!! More yikes! A mortgage is tough enough for two incomes but when that becomes one income and the family doubles, it is even tougher.

What I am continually learning as I meet more short sale clients is that each one has a tragic story of a job loss, savings lost, family issues, etc. It is sad that good people--and maybe even some not so good--are LOSING their homes. (So far, all of my clients are good people with big dreams and bad timing)

And where is the help that these people are supposed to get? I don't get the "bailout". Let's give the banks more money to loan people who maybe should or should NOT buy a home. (WHAT?) Banks get money--does anyone else see what is wrong with this????? (And then of course, there is the fact that no one equates spending $3000 a SECOND in Iraq with our failing economy here. My Dad told me that each American's share of the national debt is $450,000!!!. Ooops, digressing again.)

Why doesn't the government BUY DOWN the interest rates of each person who has a mortgage? Or pay off 10-20% of their loans--NOT re-finances--but purchase money loans--so that people can afford the mortgage that they have AND keep their homes!!!! I don't get why we are trying to get more loans in our economy--yes I DO want to sell you a home--but what about the people who are being foreclosed on right now--the people with the financial problems? Why is nothing being done DIRECTLY to help these people?????

I could go on but I would only be getting more pissed off so I will rant again sometime!

Keeping in mind that this quiz was from a few weeks ago--but also doubtful that much has changed--here are the first few answers to the True and False questions in the San Francisco short sale and REO quiz that I posted recently. Also bearing in mind that this was aimed at Realtors, let me share with you the link to our San Francisco Association of Realtors real estate district map so that you will know what the "district numbers" refer to: http://www.sfarmls.com/docs/areamaps.htm

Let me repeat the first few questions, ponder a moment--and then I will give you the answers--along with some commentary/explanation. Some may surprise you!!

1. Every district in San Francisco has at least one distressed property. T ___ F ___

2. One in 10 homes in America is in danger of foreclosure. T ___ F ___

3. There are more than 100 short sale listings currently on the market. T ___ F ___

4. There are no short sales or REOs in Districts 6, 7, and 8. T ___ F ___

There are 10 real estate districts in San Francisco. All but district 5 (Noe, Glen Park etc. http://www.sfarmls.com/docs/central.htm have some type of distressed property. The answer to #1 is FALSE.

Not sure where I heard this--I think on ABC News, but this is TRUE.

There are around 80 short sale homes and enough short sale condos currently on the market--and this number is steadily increasing--so that #3 is TRUE as well.

Now that you know #1 is false, it logically follows that #4 is FALSE as well. We in the North End like to think that we are immune but even Presidio and Pacific Heights have their muti-million dollar foreclosures! District 8 (Nob hill, North Beach and Russian Hill http://www.sfarmls.com/docs/northeast.htm ) would be immune if not for some Civic Center condos.

The onslaught of distressed properties is steadily creeping northward. Could your neighborhood be next? Somewhat kidding as you will NOT find a $500,000 single-family distressed property in the northerly neighborhoods. Get real! MOST of the single-family distressed homes are in the southern reaches of districts 3 (http://www.sfarmls.com/docs/southwest.htm) and 10 (http://www.sfarmls.com/docs/southeast.htm ).

I was pleasantly surprised at the nice-sized homes with lawns, hardwood floors and the occasional view that Oceaview has to offer when showing property there recently Oh, and did I mention the prices?!?!?? Nine homes are under $500,000 and four under $400,000!!!! At well-below median price, I think that this neighborhood has exciting potential!

I will update my statistics and return to answer more questions again soon.

Maybe you have received a notice of default on your mortgage? Lost your job? Had an unexpected financial setback? Worried about your mortgage adjusting in a few months? And even more worried that you won't be able to afford a higher payment? Or even your current one?

If you click on the link "Ed and Allison's Options", I have a report that explains about re-structuring your mortgage, short sales and short pays as alternatives to foreclosure.

Either click on the link or go directly to our new website that has this info: http://www.homeownershelpishere.com/

As one of the few people in my office who does these transactions, I did a brief presentation on Short Sales and Foreclosures Statistics in San Francisco last week at our weekly business meeting.

Try taking this quiz yourself to see how knowledgeable you are...answers someday!

SHORT SALE & REO QUIZ

(As of December 7-8, 2008)

TRUE OR FALSE:

1. Every district in San Francisco has at least one distressed property. T ___ F ___

2. One in 10 homes in America is in danger of foreclosure. T ___ F ___

3. There are more than 100 short sale listings currently on the market. T ___ F ___

4. There are no short sales or REOs in Districts 6, 7, and 8. T ___ F ___

CIRCLE ONE:

5. The median price for single family homes increased OR decreased in November, 2008.

6. There are more REO SFRs OR condos for sale right now.

7. There are more short sale SFRs OR condos currently on the market.

MULTIPLE CHOICE:

8. The percentage of distressed properties in SF is:

•a. less than 5%

•b. 10%

•c. 12%

•d. 20%

9. Other than District 10, which TWO SF MLS districts have the most SHORT SALE SFRs?

•a. Districts 1 and 2

•b. Districts 3 and 4

•c. Districts 5 and 6

•d. Districts 7 and 9

10. Which District has the highest number of SHORT SALE CONDOS?

•a. SIX

•b. EIGHT

•c. NINE

•d. TEN

11. The SF real estate market (active listings) is divided between SFRs and condos:

•a. evenly, 50/50

•b. 70% SFRs and 30% condos

•c. 40% SFRs and 60% condos

12. The percentage of SFR REOs is increasing in SF because:

•a. the actual number is rising

•b. the overall inventory is declining

•c. both a. and b.

•d. none of the above as the percentage is either stable or decreasing

13. Which District has the highest combined total of REOs and short sales?

a. THREE

•b. EIGHT

•c. NINE

•d. TEN

14. Which District has the highest percentage of short sale condos on the market?

•a. THREE

•b. EIGHT

•c. NINE

•d. TEN

15. Besides the Bayview, which neighborhood/subdistrict has the highest percentage of short sale listings (condos or SFRs)?

•a. SOMA

•b. South Beach

•c. Van Ness/Civic Center

•d. Sunnyside

•e. Miraloma Park

•f. Excelsior

16. The average amount of time to get a response from a short sale lender is:

•a. 3 weeks

•b. 3 months

•c. it depends if there are fires in southern California or not

•d. your guess is as good as mine

17. What are the benefits for taking a short sale listing?

•a. What? Are you crazy-there are none!

•b. Future business from the seller and referrals.

•c. Picking up buyers.

•d. Both b. and c.

•e. None of the above

18. Main benefit to a seller to do a short sale:

•a. There are none

•b. avoid foreclosure

•c. less of a hit on their FICO

•d. if their dream of owning a home isn't totally stomped on, they can do credit repair and buy again in 2-3 years

•e. all of the above, except a.

19. REO stands for:

•a. Residential Equity Opportunity

•b. Robbing Every One

•c. Realty Executives Office

•d. None of the above

•e. An abbreviation for OREO

20. Benefits to an agent to do an REO sale (buyer side)

•a. commission is set and may include a bonus

•b. faster lender response

•c. property is no longer marketed

•d. your buyers love you because they got a great deal

•e. all of the above

21. The hardest part about listing a short sale is (circle all that apply):

•a. getting the listing

•b. putting the package together for the lender

•c. waiting for a response from the lender

•d. finding a buyer

•e. keeping the buyer in the transaction while the lender dilly-dallies

22. Disadvantages to representing an REO buyer-which is/are NOT true (in my experience)?

•a. lengthy purchase addendum and/or counter-offer

•b. commission can be changed/lowered

•c. jumping through hoops

•d. may have to write 5-6 offers to get one accepted

•e. house may be vandalized or trashed

23. Now that I know more about distressed properties in San Francisco, I (circle all that apply)

•a. want to avoid them at all cost

•b. will refer them to Rebecca as she is a glutton for punishment

•c. may want to pursue this opportunity

•d. realize that I need to learn more

Here are the REO stats that I worked on today...

A few more SFR REOs than before and the number of SFR listings is down so the percentage is up. Since Halloween, this number has gone up both times I checked, starting at 5% and now 6.4%.

	REO	TOTAL	REO %	REO	TOTAL	REO %
DATE	SFRs	SFRs	of SFRs	CONDOS	CONDOS	CONDOS	2-4 UNITS	TOTAL

12/5/2008	39	611	6.4	23			5	67
				23	938	2.5

As I continue to track this, I will keep you posted. What is most interesting is there is hardly any change in the relative numbers. Last time there were 69 total REOs (condos. SFR's 2-4 units); today there are 67.