I've written about the advantages of being mobile and using the latest technology in the past. Now I've come across a great application for the Apple iPhone: LogMeIn Ignition.
Much like Go To My PC, PC Anywhere, and several other remote computer control programs, LogMeIn allows you to log in to an account from any computer on the web to control your computer back at the office or home. The advantage of this program is that LogMeIn Ignition for iPhone allows you to do so from your iPhone, so you can access your remote computer from anywhere you can get a data connection for your iPhone. And, it works with computers using multiple screens too.
Out in the field and you get that request to resend a file? Just open the application on your iPhone, take control of your computer and resend that file in an instant. No more waiting till you get back to the office.
Is that great customer service or what?
I've already used this program to finish up an inspection and send a report to a client from the field. this will be an often used program to give me that edge over other appraisers.
And, there is other software soon to be released for the iPhone for appraiser that will give an even greater edge to those who adopt the platform.
Last year ended with a record number of foreclosures throughout the nation, and Kern County was no exception. See my year-end summary for detailed numbers. so far this year has been remaining fairly stable with a sharp decline from December's 663 recorded Trustee's Deeds to 487 in January. February finished with 603 foreclosures.
So, the overall rate has been fairly stable since October had 520 foreclosures, but this is the same time last year that the steep climb in foreclosures began. 2008 started with 512 foreclosures in January and continued to climb until peaking in August. That rate had been increasing ever since October 2006 though, so we may not see the same pattern this year.
Many analyst believe that we are in store for a new wave of foreclosures, so the uptick in February this year may be an indicator of things to come. We'll see how March pans out.
As an appraiser in Bakersfield, the rate of foreclosures is an important statistic to watch for our market conditions. Again, for the purposes of this post, foreclosures are considered to be those properties where a Trustee's Deed has been recorded, indicating that the lender has taken possession of the property. In November we posted that the rate of foreclosures in Kern County, CA was on the decline. Well, the decline came to a soft stop.
The foreclosure rate inched up in November to 550 from 520 foreclosures in October. Not too bad. Well below the high of 1,000 in August. However, the increase continued in December pushing foreclosures to 663 for the month. This rate really needs to continue to decline to relieve the downward pressure on home prices in Bakersfield and Kern County. However, as noted in the prior post, there were a record number of rate resets in October and November, so this rate may continue to climb in the foreseeable future.
The year ended with a record number of foreclosures, certainly the highest in the past 13 years: 8,560. The next highest year was 2007 with 3,007 foreclosures, a rate less than half of last year. Between 1995 and 2004 the average yearly rate was 1,930. With a rate 4.45 times the annual average, it's no wonder that Bakersfield ended up in one of the top ten cities for home price declines in the country.
Watching this rate in the first quarter of 2009 will be very important. Home prices are at levels that are much more affordable now in Kern County. If foreclosures continue at rates similar to 2008, prices will drop back down to levels similar to the late-90's and early-00's when per square foot prices hovered in the $70 range for 8 years.
First of all, when I say foreclosure, I'm referring only to those properties where a Trustee's Deed has been recorded, or if it is on the market, is listed as an REO. Based on my data compiled from local listing services and the county recorder, the number of foreclosures has been declining for the past two months. That's not a significant amount of time, but it rules out that the first month decline was a fluke.
For 23 months the number of foreclosures recorded each month were steadily increasing. September was the first month with fewer foreclosures than the prior month. October has continued that trend. Don't get too excited though...the number of foreclosures is still very high: 1,000 in August, 871 in September, and 520 in October. Those foreclosures all end up on the market, and they comprise a HUGE portion of the listed supply. As of last quarter, REOs were 73% of the sales through the local MLS. So, with 500+ foreclosures happening every month, the supply of homes for sale will remain high, but if the decline in foreclosures continues, the supply will decrease and prices should start to level out. At least that's the supply/demand theory.
Before we all get excited, there's one bit of news that's not so rosie. October and November were/are supposed to be record months for loan resets. That means interest rates just might be jumping for a significant portion of borrowers. If that's the case, then we can expect to see another jump in foreclosures during the first and second quarters next year flooding the supply again and pushing prices down.
This is a very important piece of the market right now and should be watched closely. Lenders are fully staffed now to handle all these foreclosures and seem to be getting them on the market very quickly now. Be sure to keep your eye on these numbers: foreclosure (trustee deed) recordings and local supply; you can do so using the FAS Report or checking out foreclosure listings.
To close on a positive note, sale volume has been on the increase for the past 4 quarters which is helping keep the supply relatively low.
During these hot months in Bakersfield I need any edge I can get to speed up my appraisal inspections without sacrificing quality. Of course with most loans going FHA these days with my clients, the inspection is a little bit slower than for a conventional loan to begin with.
Over the years I've embraced new technology: dropped paper and pen for a PDA with sketching software; turned in the wheel for a disto laser; upgraded the disto laser to one with bluetooth to send measurement directly to the PDA; upgraded to a wide-angle camera; bought a telescoping ladder for those FHA attic inspections; and now I'm embracing the new DaVinci software from a la mode, inc.
I purchased a used slate tablet, specifically a Motion Computing M1400, from eBay. The computer is a little dated, so the processor could be faster and there could be more RAM, but the price was just right! It has a 12" ViewAnywhere screen, which isn't quite accurate, but it is better than my other convertible tablet. The surface of the screen is great! It almost feels like pencil on paper. The tablet is light enough to be comfortable for the length of most inspections. I still need to get some sort of bump case for it which I'm sure will help. Battery power is fairly good...I can get about four inspections on one charge, although I've changed the setting on the power button to put the unit on Standby instead of powering off. We'll see if using that extends the charge. I've been using it with DaVinci for about 3 weeks now, and I'm learning all the little tricks of the software.
The sketching process is a little different with DaVinci than MobileSketch, so I'm taking a little time to adjust. I'm still making some mistakes here and there with the sketching software. The software could use a few tweaks to work better with the bluetooth disto, but overall I'm impressed with the ease of use. After you put room labels on the sketch you can click on them to enter room-specific data. A pop-up window opens with some standard fields based on the room type, and there is a comments field where you can enter any additional info. The data from the sketch is compiled and entered into the form software. Rooms are automatically counted (there is an option in the room data to count it or not), fireplaces are counted, beds, baths, living area, etc.
As for the rest of the software, the process is fairly straightforward. There are tabs for site, exterior, interior, rooms, and critical info under the Data module. So, you can work from the inside out, outside in, or whatever other way you can think. Just click on each tab to enter data while in the part of the property. The best feature is that you can jump back to the Data module from the Sketch module without having to finish the sketch. For instance, while doing the sketch you get to teh backyard and want to enter data in the exterior section about the pool, patio, etc, you click on data, go to exterior, enter the info, and go back to the sketch to pick up where you left off. Other modules include the actual form you are using and comps. I haven't tried using the comps feature yet...I think that would further strain my battery. If I get a power converter I might try it. There is also a freeform notepad that is available at any time for freehand notes or drawings or voice memos. All the data entered goes into WinTotal's workfile as a text file, and the freeform notepad goes into the Workfile as an image file.
Initially my first inspection took about an hour. I'm getting down to about a half hour now with more information than I used to collect. The notepad is a great feature that I really like to jot down notes while talking with a homeowner or for notes about the site or exterior. Notes for the interior I try to include in the comments section for each room.
So far I'm please with the process, the computer, and the software. A memory upgrade will benefit the older computer, but I'll probably wait a month or so before investing any money into this setup. If by the end of the year I still like the setup, I think a new slate tablet will be in the works.
If defaults and foreclosures don't slow down, falling home prices won't stabilize anytime soon in Kern County.
Notices of default have been steadily increasing since May of 2005, and foreclosures have been increasing since July of 2006. From May 2005 to July 2006, most homeowners in dire straits could probably either refinance with a little equity, or sell before getting upside down.
In May 2005, there were 242 Notices of Default recorded. The following May there were 572. In May of this year, there were 1,272. More and more homeowners are falling behind which means we will continue to see the staggering number of foreclosures. Notices of Default have actually been slowing since April, but there have been short fluctuations over the past 3 years. If these continue to drop over the summer, we may start to see a decline in the number of foreclosures by the end of the year.
If the defaults continue at this pace, the foreclosures certainly won't slow down
The market peaked in June 2006 in Kern County, so after that point prices started falling and homeowners started running into problems. In July 2006, there were 17 Trustee Deeds recorded. The following year there were 237 in July, and in June of this year there were 823. There were 408 total for 2006, 3,007 total for 2007, and year-to-date we are at 4,031. Only half the year finished and we are already have over 1,000 more foreclosures than the prior year! During the years of huge price increases, the number of foreclosures kept dropping since most people could get from under their mortgages, but in years with typical price appreciation there have been 2,126 foreclosures per year (from 1995 to 2002). We are already about double that, and if we continue at the current pace, we will be nearly 4 times the normal rate.
If these foreclosures don't slow down, the bleeding won't stop.
Of the 3,760 listings in Kern County (listed in the Bakersfield Association of Realtors system), over 56% are REOs (foreclosures) or Short Sales (homeowners in dire straits). With that many distressed properties on the market, homeowners who are trying to sell their own home have stiff price competition. And, the distressed properties are competing with each other too, further forcing prices down. On the up side, we are seeing many first-time buyers getting into the market now that prices are becoming more affordable. Hopefully they are getting into good fixed-rate loan programs!
How many of the 4,031 Trustee Deeds recorded year-to-date are on the market, and how many have sold this year? There are 1,064 listed for sale, and only 1,525 have sold this year (of which some may have been recorded in 2007). Assuming all the sales were also recorded this year, that leaves 1,442 waiting to enter the market (there may be a handful pending sale which I did not include in either stat).
Interestingly, there are 1,052 properties listed as short sales, but there have only been 166 sales of such properties year-to-date. The short sales aren't competing price-wise with foreclosure offerings and are too difficult to deal with compared to non-distressed offerings, so they end up either losing out and going to foreclosure or the homeowners find a way to keep the home (less likely).
For now, no amount of bandaging will stop the bleeding. We need a tourniquet!
The Foreclosure Prevention Act of 2008 has been passed by both the House and the Senate. Congress is now resolving differences in amendments passed. Once this process is complete, the bill will go to the President to be signed into law. However, the President's senior advisors are recommending a veto if it reaches his desk. So, this may never come to fruition, but it poses an interesting situation for appraisers.
Appraisers are supposed to report any and all concessions in a purchase transaction. The bill includes a $7,000 tax credit for buyers of foreclosed properties. Whether this tax credit will actually help or hurt the market is a totally separate discussion. In this post, I'd like to discuss whether or not this should be considered as a sale concession that should be reported.
This tax credit will only be given to those buyers intending to occupy the property as a principle residence for two years, so we can automatically eliminate the "concession" for investors, but what about the others? Obviously buyers of foreclosures aren't getting this concession at the close of escrow, but they will be receiving $7,000 over the next one or two years, depending on how the buyer(s) file. That $7,000 makes foreclosures more affordable compared to other listings.
So, how should appraisers handle this tax credit? Concession or not?
So, where is the Bakersfield real estate market headed? That's a difficult question to answer because of the many variables that affect this market. Food and gas prices are increasing. We're headed into an election. Foreclosures are skyrocketing. We've probably seen the last of fed rate cuts.
All other factors aside, the biggest affects on the local market right now is foreclosures and short sales which make up over 50% of the listings and sales right now. Lenders are getting more aggressive with pricing which is forcing everyone to lower prices to compete.
Sale volume has been strong: there were 850 sales in Q1 2008 which is about the same as Q1 2007. Marketing times also remained similar: typically 2-4 months for competitively priced properties.
Prices are a differenct story. The average sale price in Q1 2007 was $319,371 and the median was $280,000, and in Q1 2008 the average was $247,180 with a median of $228,950. The total dollar loss in Q1 2008 versus Q1 2007 is over $70 million. The average per square foot price in Bakersfield has dropped from $196 to $135, over a 31% decline in 1 year.
The supply of homes for sale is down from the peak which was near 4,500 last year. Since October, the supply has declined from 14 months to just over 11 months. As the supply of available homes decreases, the decline in prices should slow, provided sale volume remains at least the same. If the flood of foreclosures and short sales decreases then we should start seeing prices stabilize and supply decrease, but if we continue at the current rate of defaults, values will continue to decline.
Regardless of what happens with foreclosures, one fact remains: prices have declined enough that they are affordable again. That means buyers are entering the market again which will eventually put an end to the housing crisis.
There has been a lot of discussion about Zaio in the appraisal related forums. Many have commented about the concept that Zaio has undertaken, but I don't know that there is a concensus out there yet. Personally, I think this is a great concept, but I think execution has been poor.
Today, Zaio announced another acquisition: Appraisal.com. Appraisal.com is an ordering portal, like Appraisalport, that was started by Day One. Specifically they've acquired the technology assets of the company. Whether that means they will be running the day-to-day operations of Appraisal.com I don't know. It may include the appraisal software that Day One produces; Zaio already owns United Systems, a competing software company. As part of the acquisition, Zaio is offering a 10% discount to Day One and United Systems appraisers on zones.
Will this help with the concept Zaio is developing? I don't think it will help the concept directly, but it may end up providing some back-end technology. However, it may be another avenue to offer the product for sale to lenders through the ordering site. Where this really helps Zaio is financially. Now that Zaio has expanded into so many different avenues of real estate technology and services, there is a much broader base to support the development of the zones. Zaio owns Real Info (a public records and AVM provider); United Systems (a software developer); Realink (an AMC and settlement company); and now Appraisal.com (an ordering system and software company). The Zaio reports aren't the only thing they are offering and I think these additional assets will help them generate revenue while they photograph and value all the zones.
I'm not sure what else they might own, but it seems as if they are positioning themselves to be in this for the long haul...even if they posted a $3.2 million loss in the 3rd quarter last year.
As the planet fills with more and more people and more and more pollution, building green is becoming a much more important and much more prevalent option. I've tried incorporating some items into my current home, but unfortunately money is an object preventing more "greenies" in my home.
So, in response to janeAnne's Pink Challenge, here is what I would do with my 5 green elements if money were no object:
1. First, let's start off with the structure of the house. I'd abandon conventional construction and go with a strawbale home built with a steel post and beam frame. Why? Strawbale is a green and renewable resource. It serves as a great insulator, especially with 18"-thick walls. It keeps out a lot of noise pollution.
2. Now that we have some walls, let's put something on top. The roof system would need to include photovoltaic cells and a rainwater collection system. Harnessing the power of mother nature will be very important in the future, so using your roof to capture some of the elements will be essential. So, we'll use the latest and greatest solar panels, and we'll use a steel roof for a cleaner capture of rainwater.
3. The interior of the house must have low VOC. Many homes have worse air inside than the air outside. This means we have to use products that have low VOC: low-voc paint, bamboo or concrete floors, and low-VOC insulation in any attic space and interior walls (yes, insulation in interior walls...it helps warm or cool only those rooms that need it).
4. An energy efficient water system. Include a solar hot water heater and a flash water heater. Again, harnessing the power of the sun is essential, but when we have those periods of low or sunlight you may need an alternative hot water heater. So, a flash heater is perfect for that. I'd also incorporate the hat water system into the radiant floor heater.
5. Finally, I think I'd like a "green" yard around me...that means only organic pest control and fertilizers, a xeriscape, and gravel driveways and walkways.
I guess that's it for now. I'm sure with money as no object I could go beyond these five elements...intelligent house control systems, passive solar lighting, energy efficient appliances, recycled furniture products, etc.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
purchased a used slate tablet, specifically a 
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