Just Do IT!!

It may not come as a surprise, but as part of my daily routine I wake up and turn on CNBC and FOX Buisness to see what the markets are doing. This morning on "Squak Box," the CEO of K. Hovnanian Homes - a new home builder, similar to JTS or Shea was on talking about home prices. He said, "Hovnanian had increased sale prices in 60% of their communities this year." ... that, "Home prices are on the rise and potential buyers may look back and regret not taking advantage of today's low rates and good affordability..."

I decided to blog about the topic because I was just looking at my own home sales stats and saw the same thing happening.

Back in January the average price per square foot for a home I was selling was $ 103.00... today, the average is $ 117.00. That means a 2,000 square foot home that sold in January for 206K would now sale for 234K! That's an increase of 28,000 in just 11 months! Although this is great news for sellers - what this means for buyers is, 'You need to get your finances in order and get qualified ASAP! I know it's December and almost Christmas, and you still haven't bought a gift for your wife's sister's cousin's dog, but forget about that for a moment and focus on YOUR FAMILY'S future! NOW IS THE TIME!!!

Owning a home for your family needs to be a priority. Especially because right now interest rates are super low, and home prices are on the rise! Lock into the good rate and good price now! If home prices rose $28,000 in 11 months - imagine what the increase will be in 18 months - 24, 36? Don't hold off and look back and kick yourself for not making owning a home a priority.

AND, if you're putting off getting things in order because you have a shortsale or foreclosure on your credit - DON't!! Stats show that "boomerang buyers" - those who have went through a foreclosure or short sale - make up a good majority of buyers looking and ready to buy again... So reach out to a lender and see if you can be one of them. In my experience if it's been 2-3 years since your shortsale or foreclosure, you may be ready. LOOK INTO IT!

If you have questions about buying, selling, need a good lender, or just want to shoot the shit about real estate, call me! I'd love to help you make your next move!

til next time,
Chris
916-834-7003

Home Prices on the Rise...

I'm going to refrain from calling it an all out, "housing market RECOVERY," but truth be told, there are some GREAT things happening in the REAL ESTATE world right now...

In a recent report by CoreLogic, a property and financial analyst company, "home prices in August rose 4.6% over a year ago, making it the biggest annual leap in prices since July of 2006."

For any Realtors, or any one that bought or sold real estate in the summer of 2006, you remember, this was the PEAK of the market, right before the down turn... So for the housing market to see its biggest "leap in prices since July of 2006" is a GREAT thing!

Now I have some even better news for us in the Greater Sacramento area... CoreLogic's analysis of a 4.6% rise in home prices is based on a NATIONAL level...

If you look at the above graphic from TrendVision, a company that calculates trends in the area, home prices in the Greater Sacramento area are up 10.5% from this time last year! In translation, if you sold your home this time last year you may have received 200K... If you would have waited until this year, you would have received 220K! I don't know about you, but an extra 20K sounds nice to me!!!

Looking at my own research, I can tell you that pending home sales are also up in our area... These are homes that have excepted offers, but all the paperwork and filings take about 30-45 days before they are actually, SOLD.

So, with all this information: August home sales up, Pending sales up... I can tell you that next month's home sales will continue to rise!! All good news for Real Estate as a whole!!

And remember... If you or someone you know has been thinking about buying or selling your home - Me and my team at CapWest are always here for you! Give me a call for a free current market analysis on your property!

916-834-7003

Will how you vote in 2012 affect the foreclosure rate??

"Holy I haven't blogged since December, Batman!!"
It's been nine-months since my last post, and I figure my topic of choice has to be a good one! ... Knowing we just wrapped up the Political Conventions last week, and yesterday marked the 11-year anniversary of Sept. 11th (Thank you to all our servicemen and woman for your daily sacrifices for our country) I feel a desire to be Patriotic, so I am going to work politics into this blog... Kind of...
I just read the blog of Sean O'Toole, the Founder and CEO of ForeclosureRadar.com . In it he talked about "how we continue to see reports that there will be a wave of foreclosure sales after the election in November..."
Now, I haven't seen any of these "continued reports" he is talking about, but I liked the topic...
The latest foreclosure numbers came out for the month of August, and from those numbers we are able to determine that come November, there will be NO influx of foreclosures. So, whether you vote for a new President, or vote to keep the President, for now it will not affect the foreclosure rate in any way. Here's how we know:
For August 2012, California Notice of Defaults were down 23.6 percent from July and down 49.1 percent from last year (foreclosureradar.com) . For those of you that don't know what a "Notice of Default" is; it is the first step in the foreclosure process - usually happens when someone hasn't been paying their mortgage for approximately three months. It's the bank's way of saying, "hey, you're not making a mortgage payment, if you don't get caught up we're going to foreclose on you..." So after a bank sends a Notice of Default (AKA takes the first step in the foreclosure process) it is mandatory that they wait a minimum of three months before they proceed and continue with a Notice of Transfer Sale.(AKA second step in foreclosure process... It is a letter to the homeowner giving them the exact date their home will be taken back)...
So from the August foreclosure numbers we are able to see that since less homes received Notice of Defaults (entered into the first step of the foreclosure process) come three months (AKA November), which is the minimum time banks have to wait until they proceed to the next step of the foreclosure process - the real estate market will not be hit with a wave of foreclosures after the election.

What this means for potential home buyers and investors: expect inventories to remain low, and offer competition to remain fierce - expect multiple offers on listings...

This is good news for the real estate market in general, because this means real estate prices will continue to rise, but not so good news for buyers because they will have so much company when trying to make offers...

Shameless Plug time:
Me and my staff here at Capital West Realty, INC are masters of Real Estate. Not only am I a certified short-sale and foreclosure specialist, but our office has four foreclosure accounts with banks. This means we often have an "insider" prospective on things coming up for sale, which means you could too! If you have any questions regarding buying, selling, short-sales, or foreclosures, please don't hesitate to call! I'd love to help!
916-834-7003

~ Chris

Ho-Ho HOME SALES!!

So in the real estate world, Nov. 23rd - Jan. 2nd is considered the "Holiday Season..." At the same time, any real estate agent or broker will tell you, there are no such things as "weekends" or "holidays" in this business... Nonetheless, my family and I decided to go to Hawaii this year for Thanksgiving, and as I packed the iPhone, the iPad, the lap top, and all my files, my wife says, "Chris... WE ARE GOING ON VACATION!!!" So, the hour long conversation I proceeded to have with her after that inspired my next blog... "Ho-Ho-Home Sales!!"
Because almost every other person on the planet takes time off for Holidays and goes on vacation, if you've been thinking about selling your home, why not do it at a time when other potential buyers may have held off because they have vacations planned, or family coming into town? Think about it, only REAL serious buyers will be out looking at homes the day after Thanksgiving or Christmas Eve. Why not list your home and take advantage of being a property that is available for these serious buyers to look at? For that reason I always advise sellers to go ahead and list their home during the holiday season rather than wait... Staging a home during the holidays is a big plus also. Something about the smell of pine and "stockings hung by the chimney with care..." it really seems to help people imagine spending their next holiday in that house...
So bottom line, if you've been thinking about listing your home, but wanted to hold off until after the first of the year, don't! The fact that a lot of people are thinking just like you and WILL hold off, means the market will be less populated, which means more attention for your property! And the type of attention that will be given during the holidays will be from serious buyers, who think finding a dream home is the best gift they can receive this year. And last but not least, that Douglas fur, and gingerbread cooking in the oven will help potential buyers feel like your home could be their home!
If you have any questions or would like more facts and tips about listing during the holidays just give me a call. I'm always available!

~Chris
916-834-7003

Patience and imagination are virtues ALL buyers need

All right, so for the last couple months I’ve been telling you that now is a good time to buy... With foreclosures and short sales currently on the market, and more to come in the next few years, a potential buyer can walk away paying 100k for a home that sold for 280k just three or four years ago… With that said, I came across an article this week that the Wall Street Journal did, and it pointed out an issue I realized I never talked about... That even though our current housing market is seeing an “oversupply of homes, it is also facing a new problem: a lack of attractive inventory.”

Here’s why…

Right now a lot of homes on the market are either short-sales or foreclosures. This means the homeowners living in them (or the tenants renting them) have no money at stake. They don’t care to make repairs to the home to make it more attractive for a buyer.  

They don’t care to touch up paint, or clean the walls to make the home look new. The owners or tenants of these homes aren’t getting any money from a short-sale or foreclosure and could care less if you see the home at its best… or its worst for that matter…

In the WSJ article, Slim Pickings Are Latest Headache for Home Sales, the author points out that because the inventory for 'regular' home sales are low, (not a short-sale, not a foreclosure) it may be hard for buyers to find their dream home, because a lot of homes they are looking at need a lot of work, and buyers just can’t see past it.

The bad news for buyers looking to find an immaculate home for a cheap price is, “regular” home sellers are pulling their homes off the market, rather than try to sell them at today's discounted prices.”

And really, you can’t blame them… How can they ask top dollar for their home, when the home next door is going for 100k less as a short-sale…?

So, like the title of my blog says, patience and imagination are virtues all buyers need in this type of market. Go into these short-sales and foreclosures knowing the situation. Know you may have to see past a lot of junk, dirty walls, stained carpet, chipped paint, broken sinks, cracked windows, trashed yards… If you can, you may just find your dream home, and at a great price. If you can’t see past it, and a lot of people can’t, just have some patience that the right home for you just hasn’t hit the market yet.

My wife always tells me, “all things in life happen at exactly when they are suppose to…” Purchasing a home is big deal. When it’s the right time, and right property, you’ll know.

Why you should become a landlord...

Over the last several weeks I’ve seen a reoccurring topic amongst Real Estate news: RENT.

So far in the last month I’ve read a handful of articles talking about the current “Rental Property Boom,” so thought it would make for a good blog.

CNN’s “Cashing in on Rental Property” article was one of the most informative that I read, and I really liked their, HOW TO FIND A GOOD DEAL section.

The meat of the article pretty much says, because of all the foreclosures that are inundating the market (see previous blogs) now is a great time to buy a rental property.

“…demand is up for rental properties and rents are rising. That's partly because foreclosures have turned more than 4 million former homeowners into renters, but also because many other prospective homeowners, worried about losing their jobs or housing prices falling a lot further still, are reluctant to buy now.”

“Many factors make this a great time to invest. Mortgage rates are at a 40-year low, and homes in many areas are ultra-cheap. Meanwhile, demand for rentals has risen in more than 500 cities, according to recent Census data. That, in turn, has enabled landlords to charge more.”

That last little sentence is the most important… “Landlords can CHARGE MORE.”

Being able to charge a renter more, means you will likely be able to get more money than what the mortgage payment is, which means POSITIVE CASH FLOW.

Here’s why… Typically banks require an INVESTOR to put down 20-25% of the loan price and prove they have enough funds to cover at least six months of the mortgage payment, taxes, and insurance… An example… A client of mine just purchased a rental property for 125K… He put 20% down, making his loan amount $100K. His monthly payment (including mortgage (PITI) and Water, Sewer & Garbage) is $800… After speaking to a local property manager he found out that the average rent in this area is $1200… That’s a POSITIVE CASH FLOW (PCF) of $400!!

I’ve found recently that an investor can have a PCF of upwards of $100.

To be honest, because I am a short-sale and foreclosure specialist and a lot of my clients are investors, the average PCF I’ve seen is around $600…

So, if you’ve ever wanted to invest in some rental property, now is certainly the time… Especially with more foreclosures expected to hit the market, and more previous homeOWNERS becoming homeRENTERS…

Some personal advice from me: I suggest finding an area you’d like to own in, then sitting down and talking to a good property management agency in THAT area… That way you can get a good idea of what your average rent would be… Then sign up with a local realtor who has access to foreclosure properties before they hit the market, this way you can get an offer in before anyone else… CNN Money also suggests, staying local…

“buying something you can get to in 10 minutes… Familiarity with the neighborhood also limits nasty surprises like a noisy bar or a nearby development competing for renters…Work with a local realtor who has experience with rentals and can help you assess how attractive a given home will be to tenants. “

Since this is MY blog, I am gonna go ahead and advertise that I would love to help you get into the rental property business. If you've been thinking about it, and have more questions just give me a call. 

916-834-7003!

Hope we can talk soon!

~ Chris 

Federal Reserve: “A sluggish Real Estate Market affects all sectors of the economy.”

So I got this article last week, but decided it was a great topic to kick off October with.

In my last blog I talked about how a housing market recovery wasn’t likely to happen any time soon, because more foreclosures were on the horizon.

“Remember, we can only say we are in an actual “RECOVERY” when home prices are higher, and people are actually making EQUITY on their investments.”

Well it turns out the Federal Reserve met in Sweden last Wednesday to discuss what more foreclosures means for the economy as a whole, and are finally realizing they may need to re-think how they are dealing with the situation…

Fed's Rosengren says allow underwater borrowers to refinance

So, as many of you may know, right now interest rates are at an all time low. ESPECIALLY on mortgages. True, this is GREAT news for people wanting to buy a home because they will be able to qualify for more money, but what about for those of us whom already have homes, but want to try and take advantage of those rates and refinance…?

"In the U.S., most homes are financed by 30-year fixed-rate mortgages, so a fall in long-term interest rates really only affects existing homeowners to the extent they refinance… This scenario is not working in an economy where many borrowers have fixed rates and homes underwater are keeping them from refinancing.”

That’s right… Interest rates being at an all time low mean nothing to those of us whom are already in a home, because the only way we can take advantage of those low rates is IF we can refinance… The only way a person(s) can refinance is if they actually have EQUITY in their home… EQUITY is something real hard to come by these days because home prices are dropping like crazy, due to SO many foreclosures hitting the market… See the cycle…?

The semi-good news is that this article is pointing out that the head of the Federal Reserve is now open to allowing banks to refinance a home, even though there is no equity in that home… The REAL-bad news is; just because he is open to the idea, doesn’t mean it will happen. In fact, in my opinion, it won’t happen any time soon because there is too much legislation that would have to pass in order for it to work…

The whole reason I wanted to blog about this topic is because I wanted to congratulate the Federal Government on realizing they need a plan B for their economic recovery, and good job on realizing that plan needs to start with aiding in the recovery of the housing market…

“Rosengren stressed that no recovery can be fueled without restoration of the housing market. Residential investment grew more than 30% in the first years of past recoveries, while in the recent recovery, residential investment actually fell in the first two years following the end of the recession… declines in real estate prices can have a substantial impact on the capital of financial institutions, which impacts their ability to finance not only the housing sector, but also other sectors of the economy…”

Here’s hoping it doesn’t take them another 10-years to actually get things going.