Sharon Koziel

Our California Association of REALTORS alerted us this week that Mortgage loan delinquencies did rise but foreclosure were flat. Might this mean that the banks are beginning to work out some of the short sales that have been on their desks for months? I hope so!

"The delinquency rate for mortgage loans on one-to-four-unit residential properties rose to a seasonally adjusted rate of 9.24 percent of all loans outstanding as of the end of the second quarter of 2009, up 12 basis points from the first quarter of 2009, and up 283 basis points from one year ago, according to the most recent Mortgage Bankers Association’s (MBA) National Delinquency Survey. The non-seasonally adjusted delinquency rate increased 64 basis points from 8.22 percent in the first quarter of 2009 to 8.86 percent this quarter, according to the report. The delinquency rate breaks the record set last quarter, based on MBA data dating back to 1972.

“While the rate of new foreclosures started was essentially unchanged from last quarter’s record high, there was a major drop in foreclosures on subprime ARM loans,” said Jay Brinkmann, MBA’s chief economist. “The drop, however, was offset by increases in the foreclosure rates on the other types of loans, with prime fixed-rate loans having the biggest increase. As a sign that mortgage performance is once again being driven by unemployment, prime fixed-rate loans now account for one in three foreclosure starts. A year ago they accounted for one in five.

California, Florida, Arizona, and Nevada continue to have a disproportionately high share of foreclosure starts, although the share has fallen slightly from last quarter, according to the report, with 44 percent of all of the nation’s new foreclosures during the second quarter of this year, down from 46 percent in the first quarter."

I believe everyone is feeling the fallout from this recessions but some parts of the US are coming out a bit on top. Here is a great interactive map from NPR that shows you where you might move if you want to get away from the heavy hit counties. Just click on this link and find your state on the right hand side to narrow your search.

While on the site you might review the unempoyment rate as well.

Just looking at the U.S. as a whole is interesting and if your are from the middle part of our great county you might be smiling more that us on the coasts.

I am the type of person that believes we should look at the glass half full so I am happy to report that the Corona, CA real estate market is improving. Lets get some good press out to the public and let them know that things will turn around. Here are some facts:

Month# Units Median Price Days on Market

Jul-09	862	329,000	99
Jun-09	1,006	329,850	110
May-09	1,108	325,950	119
Apr-09	1,335	329,000	116
Mar-09	1,570	321,950	115
Feb-09	1,682	324,900	116
Jan-09	1,884	328,900	124
Dec-08	1,970	330,000	129
Nov-08	2,131	330,900	119
Oct-08	2,375	339,000	113
Sep-08	2,473	349,900	113
Aug-08	2,513	354,000	113
Jul-08	2,667	360,000	108

The number of homes for sale are down 68% but the median price is increasing. With less homes on the market surply and demands takes over. Days on the market is decreasing which means the buyers are acting on good buys.

The average months supply of inventory is down 78.3%.

It's time for buyers to start realizing that unless things change soon they should be in the market now!

Appraisal rules rewritten poorly!

In a desire to curb abuses in home loan appraisals our government passed a law that became active on May 1^st of this year. The desire of this law was to curb the bad appraisals that occurred during the housing boom. The new law prevented appraisers from having contact with the lender or REALTOR involved in the transaction. This would prevent undo pressure to be brought on the appraiser to "come in at a certain price". It also prevents the real estate agent from telling the appraiser special features the home my have or the reason why the house down the street with no drywall was sold so low. Yes, you might say the appraiser will find that out when he visits the home but with this new process many appraisers are using pictures in the MLS as their home investigation and doing a drive by only. This lack of effort is partly caused by the low compensation the appraisers are receiving since the Management company is now taking part of their income. They need to do twice as many appraisals to earn the same amount of money they once did.

To protect themselves from liability, most lenders are ordering appraisals from appraisal management companies (AMCs), which intermediate between the lender and the appraiser. The AMC selects and pays the appraiser, receives and evaluates the appraisal, and passes it to the lender, which has no direct contact with the appraiser.

What could be wrong with this plan? Well after just a few weeks we now have a major problem. The AMCs don't have companies in every area so we now have appraisers from one county trying to do appraisals in another county. Their bias for certain areas is showing up with lower appraisals in many areas because they don't know the area or the different complex array of site issues. Many deals are being cancelled because of low value in the appraisals. Recently the National Association of REALTORS worked to get local appraisers doing local appraisals. Although this is suppose to be implemented immediately I don't see it happening.

The new rules is adding time to the mortgage process and preventing anyone from talking to the appraisal to remedy the situation. If a borrower has to change lenders in the middle of a transaction we can no longer use the first appraisal which adds cost to the borrower.

We need to get the housing market back on track and this new law isn't going to do it! Call your representatives today and demand they scrap this law and let the marketplace get back to creating value.

Money is tight for us all but the consumer better keep a keen eye on the government in the coming weeks. More laws are being prepared to raise money for the county, city and federal government. Do you think they don't concern you! Think again. Many areas are trying to pass point of sale laws that will have a homeowner replacing wood-burning devices, windows, air conditioners and plumbing before closing can take place. The REALTOR® Action Fund is fighting to protect homeowners but we need everyone to get involved.

If you think I am calling wolf then let me point out two laws that affect millions of sales in the coming years.

New laws have taken effect in San Luis Obispo County requiring residents in Los Osos to retrofit plumbing fixtures at point of sale because of the town's dwindling water supply. Specifically, toilets are to be replaced with toilets rated at no more than 1.28 gallons per flush (gpf).

Contra Costa County in the San Francisco Bay Area adopted an ordinance which requires gas shut-off valves be installed downstream of the meter and at the point of appliance on all buildings sold within unincorporated areas of the county prior to entering into an agreement for sale or prior to close of escrow.

The California Energy Commission currently has a state-wide point of sale ordinance for energy conservation in their strategic plan and the California Public Utilities Commission has a recommendation for local point of sale ordinances in their recently released draft California Energy Efficiency Strategic Plan. Therefore, in the future all local governments may be required to adopt more stringent standards.

Since we are seeing very few sales with homeowners walking away from the closing table with equity many transactions are going to fall out of escrow if homeowners don't have money to pay for these requirements and the buyer will not pay for them.

It's time to tell our legislators that point of sale is not the time to demand these repairs.