Bill Gross

A loan officer I have worked with tried to get their client a loan modification, but after months of effort, was going to give up. He called me and asked if we could help the seller avoid foreclosure as they wanted to be able to re-establish credit in a few years to buy another home. I met the homeowner in July 2009, when they were behind on their payments on two loans totalling $646,800 on a home worth less than half that. We put in action our short sale game plan, getting the property on the market immediately. Having a potential buyer helps start the process and gives the seller the most potential options. The lender first eventually filed a notice of default in November, 2009 for the first which at $472,000 was still more than the house was worth. Many agents shy away when there are two loans, as many 2nd lenders require an unreasonable settlement forcing foreclosure by the first and leaving the seller potentially liable for the unpaid 2nd. Another challenge is the time with 2 loans often takes so long that the buyer loses interest and cancels, leaving the homeseller facing foreclosure. We were able to find the buyer within our own team (I have an agent that specializes in this Spanish-speaking market), and I coached them on the time it would probably take to close the escrow. Meanwhile, we negotiated with both lenders continuously until we received an offer that allowed our seller to close without any liability at a price the buyer could afford to pay. The seller should have their credit re-established in two years rather than waiting 7 years after the foreclosure, and the seller avoids any liability for the shortage on the 1st or 2nd loan. If you or anyone you know wants RESULTS like this, please contact me for a no-cost consultation of your options. We work on files like this every day. Check my website www.StupidShortSales.Com

You may be aware that the federal tax credit of $8,000 for each first time home buyer expired on April 30. While it was widely anticipated that it would be extended by Congress, it is at this time expired. The tax credit was a major factor increase the demand for houses and may be responsible for keeping prices higher than they otherwise would be. You may also be aware that the state of California initiated a $10,000 credit designed to replace the end of the federal tax credit. However, what you may not be aware that the $100 million allocated for California’s first-time homebuyer tax credits may be depleted in about 10 to 20 days or sooner, according to the California Association of Realtors (CAR) Economics team. California’s Franchise Tax Board planned to begin accepting applications on May 1, 2010 for tax credits up to $10,000 for first-time homebuyers and for homes that have never been previously occupied. However, the total tax credit allocation for all taxpayers is $100 million for first-time homebuyers and $100 million for new homes, both on a first-come, first-served basis. CAR’s forecast of 10 to 20 days to deplete the $100 million allocation for first-time home buyers is based on estimated May sales figures and other parameters. It does not take into account the possibility that buyers scheduled to close escrow in April may delay closing until May to take advantage of the tax credit. If a shift in closings from April to May occurs, the first-time homebuyer tax credits may be depleted even more quickly than indicated above. If you are interested in buying a house to take advantage of this tax credit, please call me immediately so we can see what can be done to expedite things to get in line for the credit. If you are considering selling your house, let’s discuss what we can do to expedite the sales process to catch the buyers interested in this credit to help you get the best net equity from your sale. Here is a link to the state of California Franchise Tax Board with details: http://www.ftb.ca.gov/individuals/new_home_credit.shtml I am here to help you take advantage of this opportunity!

My continuing saga. Every buyer that does not buy believes the market is going to continue to decrease under the weight of all the bank-owned properties that are said to be coming to the market. Every seller that does not sell now is expecting the market to get better in the next year or two for no explainable reason other than their desire.

As frustrating as that can be, it is critical to look at the market stats for each area and each market within the geography (price, SFR v. condo, etc.).

Our MLS puts out a great graph that shows that in the first half of the year there have been two geographic markets, one getting better (generally south of the 10 and east of the 405 in lower priced areas) and one getting worse (generally the higher priced areas north of the 10 and west of the 405). The particular data the graph uses is Days On Market, which shows how long an average listing takes to sell. All things equal, homes selling faster will mean prices are rising, and homes taking longer means that prices are falling. That is a crude generalization, but like most generalizations it is generally true. Take a look at the graph at the link below. Of course, if you are buying in a particular area or price range the data will be different, and that's where a professional Realtor can give you statistical analysis unique to your particular needs. How can I help?

If you are interested in seeing the graph let me know and I can send you a link.

The million dollar question. I get asked every day by buyers and sellers. I get told every day by buyers and sellers, buyers that the market is going to go down further when the "hidden" foreclosures come to the market, and sellers that the market will be up next year as long as they can rent their place this year to cover their payment. I do not have a crystal ball. Or, another way to say it, I do not have a crystal ball. I do think we have to pay attention to signs and try to figure out what is happening. A big sign in LA that is going to get bigger is 7-11. At one time there were 1,500 7-11 stores in LA, now has 800. I was surprised when I was in Santa Clarita today that there are NONE in the area at all! An article in the LA Times last week detailed the company's plans to nearly double by adding 600 stores in 7 years, and doing so now will let them improve their real estate costs as well as expand. They also feel they are hitting the market for lower priced options where their coffee bars and hot dogs are cheaper alternatives to Starbucks and fast food. Seems like the bottom has been hit in the entry level housing market. In every location I work the bottom level homes are selling for 10-20% higher in price than just 4 months ago, and the competition is staggering. Southern California still attracts immigrants from all over the world and increasing numbers of people will need places to live, eat, and buy Slurpees. How, I am looking for the article about Nordstrom's plans to open new stores. Anyone seen it? The full text of the LA Times article can be found at: http://www.latimes.com/business/la-fi-seven-eleven24-2009jul24,0,7883938.story

As of July 3, 2009, the state of California is no longer accepting new home credit applications. They have received over $100 million in new home credit applications and more than 12,000 applications. They planned to receive 12,000 applications since many are duplicates, revised, or invalid. This ensures they have more than enough valid applications to allocate the full $100 million. These additional applications will be subject to the availability of remaining credits. This tax credit was available for qualified buyers who on or after March 1, 2009, and before March 1, 2010, purchase a qualified principal residence that has never been occupied. The buyer must reside in the new home for a minimum of two years immediately following the purchase date. The federal government is still offering a tax credit for first time buyers of resale or new homes. Feel free to contact me for details. Details on the state program are here: http://www.ftb.ca.gov/individuals/New_Home_Credit.shtml