Walnut Creek Real Estate

Get Your Galoshes On!!

Steve Dawson (Prudential California Realty) — Fri, 07 Aug 2009 17:38:26 -0500

I know you have heard it before. But this time it is a must. The REO's are coming. I just spoke with a top exec. at B of A, and they are drowning. We have been told twice this year that the REO's will be dumped onto the market, and twice we have had moratoriums, keeping them under wraps.

One of the reasons was because the government wanted to see if the loan modifications would work, which they did not. A lot of the homeowners who did loan mods are back into default. So, in order to fix this problem, the banks need to unload their assets and deal with the consequences.

The number is not clear, but it is around 90,000 reo's in california alone that the banks are holding onto, and trying to keep under wraps. But come September of 2009, the moratorium is over and we will be flodded.

What this means is the market price will take another dive, one more time. Supply and demand will bring the prices down and a huge rate. Then, after a few years, we will recover and slowly climb our way back up.

Not only is this troubling to hear for most homeowners, but here is more potentially bad news. This exec. mentioned that it would not be out of the question for the interest rates to rise into double digits. If you think about it, that could be very harmful. We would have a large supply of bank owned properties, short sales and a few regular sales, and no buyers buying them because the rates are so high, no one can afford the payment.

Time will tell. We are not out of the woods yet.

Trying to Win a Contest for a Good Cause

Steve Dawson (Prudential California Realty) — Tue, 10 Feb 2009 12:10:01 -0600

I am trying to win a contest for my doggy. The winner gets to donate $10,000 to a charity of their choice. Mine would be to the Animal Foundation in my neighborhood. Please vote for COOPER!! Just click on the picture!!

New Law Could Help Stop Foreclosures

Steve Dawson (Prudential California Realty) — Thu, 08 Jan 2009 15:44:48 -0600

Democrats have wasted no time in creating a new bill to change bankruptcy rules with the aim of reducing home foreclosures. Under the proposal, judges could order lenders to forgive some mortgage debt.

The measure would change the law to give homeowners filing for bankruptcy the opportunity to restructure their loans so that they can save their homes from foreclosure.

"The economic turmoil we are experiencing is a direct result of the burst housing bubble," said House Judiciary Committee Chairman John Conyers, D-Mich., who co-sponsored the bill in the House. "Foreclosure is now expected to claim more than 8 million homes by 2012 -- 16% of all mortgages in America. To set our economy on the path to recovery, we need to strengthen our communities by taking steps to stabilize the home mortgage market. Giving homeowners the chance to restructure their loans will help more families avoid foreclosure."

Lawmakers who introduced the Bankruptcy Act of 2009 argue that the effect of the anticipated stimulus package will be greatly diminished unless foreclosures can be reduced. They say it would help break the continuing cycle of foreclosure that threatens neighborhoods and cities across the country.

Rep. Linda Sanchez, said that under the current bankruptcy law, judges can restructure debt on vacation homes, yachts and private jets, but not on primary homes. "There is no reason why average Americans should not have the same legal protection to save their family homes."

Rep. Jerrold Nadler, said that under current law, home mortgages are virtually the only debts that cannot be modified in bankruptcy. The proposal, would give homeowners the same advantages corporations have when trying to restructure their debt. Voluntary efforts to modify loans have not produced the desired results.

Please Save Our Environment Before It Is Stripped Away!

Steve Dawson (Prudential California Realty) — Fri, 12 Dec 2008 13:42:38 -0600

This is a plea for our environment. President Bush is trying to destroy one of the few places we have to enjoy our beautiful nature. Bush's plan is to auction off hundreds of thousands of acres of land near national parks. A week from today, he wants to lease 276,000 acres of pristine land. Areas such as Arch's national monument, Dinosaur national park, Canyon Lands national park, to name a few.

Bush is planning a midnight regulation which would do the following:

1) Weaken rules on drinking water, allowing higher arsenic levels.

2) Allow coal companies to dump into streams.

3) Oil and Gas leases next to national parks.

4) Concealed weapons in national parks.

5) Uranium mining near Grand Canyon.

6) More snowmobiles at Yellowstone.

These iconic places, gifts for the entire world are being threatened by one man, for a short gain. This plan is definitely aimed at helping the big oil companies, which Bush is a big part of. And it would destroy these grand places permanently for a quick buck in the already rich pockets of the oil companies.

But there is something we can do to stop this. Please. You have exactly one week to contact your leaders, representatives, congressmen, and the White House, and tell them not to allow this. Do not permanently harm this great countries monuments for temporary gain.

Government Buydown Story Leaked!!

Steve Dawson (Prudential California Realty) — Fri, 05 Dec 2008 15:08:31 -0600

If you haven't heard, there has been talk about the treasury dept. lowering the interest to 4.5%. However, what you might not know is that the National Association of Realtors (NAR) was in secret talks with the treasury about how this would affect the economy. The proposal would be something like this:

"A buyer would qualify for a traditional loan (from Wells or others) and then the government would buy the loan down to 4.5%. The government would get the money by issuing bonds at 3% thereby making a 1.5% profit on the buy-down. This program could only last six months or could go up to 18 months."

Well, The bad news is that there was a significant leak regarding these discussions as a story appeared in the Wall Street Journal, New York Times, and the Washington Post yesterday morning. NAR claims no responsibility in the matter and apparently treasury is not extremely happy! The net of this leak is that buyers potentially may sit on their hands until this buy-down takes place!

I believe this proposal is in the best interest of the industry and real estate practitioners. Please galvanize your offices and agents to email congress and our senators to approve this buy-down. There is perhaps a 50% chance that there will be an announcement on the weekend for this program. This lobbying needs to take place over the next week! Please contact government officials to express your approval of this type of buy-down.

A sample letter would look like this:

I support the proposal to have the government lower interest rates to 4.5% for the purchase of homes. This proposal, in its current state, could potentially change the picture for the entire real estate industry and therefore the entire economy.

I believe this proposal is in the best interest of the industry and the country as a whole.

Best regards,

Name

In addition to sending correspondence to your senator, please also send it to your local congressperson. Click on the link below, add your address, and you will see the link for your local congressperson.

http://www.visi.com/juan/congress/

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

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www.SteveDawsonRealty.com

Call Today for more information

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Big Three Bailout--Back Again--What are your thoughts?

Steve Dawson (Prudential California Realty) — Thu, 04 Dec 2008 09:37:29 -0600

So, the Big 3 are back again to try to beg for the money they say they need to stay afloat. When they first came, in their private jets, they were asking for 25 billion from the taxpayer. Of course, they said it was going to be a loan, which would be paid back. But I wonder, if we pay for the bailout with our tax money, and they pay back the loan, do we see that money again? I doubt it. If the money leaves our pocket, we won't see it again. Now they are asking for 34 billion. An increase of 9 billion in 2 weeks. Wow, I would love to see this kind of increase in my pay that quickly.

Iknow the biggest problem with not helping out the auto industry. The biggest problem being that lots of jobs will be lost. But is it really a good idea to fix a boat with a whole that is sinking with elmer's glue? These companies aren't failing because the economy is hurting, these companies are failing because of bad business decisions.

Before we start giving money away to these auto makers, let's look quickly at what just happened. Some major banks just got billions of dollars to help free up funds to start lending again, with the idea that it would help people be able to start buying homes. But what happened? The banks took the money, and did what with it? NOTHING. They said they were going to free up some money, but they haven't and no one is making them at this point. Is anyone is control out there? It is getting very frustrating.

But I digress. Today, the Big 3 will ask for it's money. They will try to convince that it is necessary for them to have this gift. It is very important that the right decision is made, because we don't want another disaster like TARP.

What are your thoughts on whether or not the Big 3 should receive this money? The pros and cons.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Fed's Beige Book

Steve Dawson (Prudential California Realty) — Thu, 04 Dec 2008 09:08:06 -0600

Economic activity has weakened across the United States since early October, while price pressures have eased with declines in retail and energy prices. This is no secret to the American people. We have been feeling the pinch for many months now.

The Fed's Beige Book summary portrayed declining conditions in most areas of the economy.

Labor markets weakened as firms in many districts reported accelerating layoffs. Wage pressures were largely subdued, the Fed said.

Consumer spending slumped, with retail sales decreasing and vehicle sales falling off sharply in most regions of the country. The report was based on data collected before November 24. And obviously, it hasn't gotten any better.

Earlier this week, a panel of experts formally declared the U.S. economy in recession since December 2007. The Fed is expected to its lower benchmark interest rate target by a half-percentage point to 0.5 percent at its next scheduled policy meeting December 15-16.

Some analysts expect the Fed could bring rates down to zero by its following meeting at the end of January as it seeks reverse the economic contraction linked to the collapse of housing markets and a jump in home loan defaults.

Adding to the gloomy picture, the Beige Book described weak housing markets characterized by reduced selling prices in many regions. Sales were down in most districts, the Fed said.

Credit conditions remained tight and business and consumer lending activity slowed in most districts. Unfortunately, this should not be happening still. The reason our government bought up a bunch of stock in major banks is so the banks would free up some money to lend to consumers. But it looks like so far, they are still be greedy and not lending much at all. Is anyone in control out there, or are we just giving money to everyone and letting them do as they wish? We won't last long if we keep doing this.

I am really curious as to what the government will do regarding the Big 3. At first, they were asking for 25 billion, now it is up to 34 billion. When will this end? Time will tell I guess.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Blackberry Storm Review

Steve Dawson (Prudential California Realty) — Tue, 02 Dec 2008 17:24:34 -0600

A couple of weeks ago, I talked about getting the Blackberry Storm. I was pretty excited about getting this phone. I needed a Blackberry, so I was waiting until this one came out. I have been disappointed. Here are some of the things I don't like about this phone.

First, I turn the volume up all the way and still have to plug my other ear to hear what the person on the other end is saying.

Next, while I am on the phone, my cheek hits the mute button without me knowing and then the person on the other end can't hear what I am saying.

Next, All of a sudden, my phone stopped syncing to my email, so I no longer was able to receive my emails through my phone.

Here is one of the most frustrating things. When my phone rings, I can't answer it. I try pushing the talk button and also try pushing the answer button and neither one will answer the call. This doesn't happen everytime, but it happens enough to make me miss important calls.

I am not one to give advice, but in my opinion, I would wait until all the bugs are out of the phone before getting this one.

TARP Conference 11-10-08

Steve Dawson (Prudential California Realty) — Thu, 13 Nov 2008 11:22:00 -0600

OK, so I went to the conference in New York a few days ago. The Troubled Asset Relief Program (TARP) had a summit on this major economic mess we are in. I decided to go because I believe that it has a major affect on our business. I must have been the only one who thought that because I was the only Realtor there.

I was dissapointed to say the least. The conference lasted 8 hours and at the end, there were more questions than answers. Apparently, the government has no idea what they are going to do. We were told weeks ago that the Treasury dept. would buy up the bad assets to free up capital for banks so that they can start lending again. But now, they are saying they are going to be buying stock in those banks, which makes no sense to me.

By the way, just so everyone knows. In 2009, we are going to be crashing!! The foreclosure rate, according to the treasury dept., will be skyrocketing 3 times higher than it is now. You think it is bad now, wait and see.

The treasury dept. is now trying to increase participation in home saving programs so this does not happen. But homeowners are so scared to answer their phone these days because of creditors, the people who are trying to help them can't get through to them. Some of these programs, namely NeighborWorks, and HopeNow, have been successful in many cases helping homeowners keep their home. Some of the bailout money will be going to help fund these types of programs.

Contra Costa 3rd Quarter Market Report

Steve Dawson (Prudential California Realty) — Mon, 27 Oct 2008 19:20:56 -0500

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

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Call Today for more information

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San Francisco Bay Area 3rd Quarter

Steve Dawson (Prudential California Realty) — Mon, 27 Oct 2008 19:13:15 -0500

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to

yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

We Need To Think About Our Future!

Steve Dawson (Prudential California Realty) — Sun, 26 Oct 2008 16:36:28 -0500

Some claim that if we abuse our planet at the same rate as we do today, then out planets resources will only last until 2032. That is pretty scary.

It doens't take much to help our planet out. Some people recycle, some people drive hybrids, and some people use energy efficient light bulbs. These are all excellent ideas in prolonging the life of this planet.

I for one like the idea of solar panels on my home. It saves a lot of money for one thing. We have this perfectly good source of energy that rises everyday, called the "Sun." It's a perfectly good source of energy that I think we all should take advantage of. Now some people think that solar panels are ugly. I would have to agree with you. But we are coming along way with technology these days. They are now creating what is called, "integrated roof shingles."

They are much more attractive than the old, ugly solar panels people used to use. They happen to be just as expensive as the bulky solar panels you are used to seeing. It may cost a lot in the beginning, but when you are saving $200-$300 per month on electricity, that can add up. And over the years, these panels will save you a lot of money. But more importantly, if you choose not to use these panels, or choose not to help save this planet, so you can save some money in your pocket, what good will the money be when there is no planet?

Just a thought.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

If Parking Isn't Enough Of A Problem!

Steve Dawson (Prudential California Realty) — Fri, 24 Oct 2008 22:03:13 -0500

For those of us who know about Walnut Creek, we know it is the hub for shopping. We have any and every store you could possibly want. Walnut Creek isn't that big to begin with. There are about 63,000 residents in a 20 square mile land area. That is 3200 people per square mile. Downtown Walnut Creek has a huge parking problem. On the weekends, it is very tough to find any parking, free or not. During the holidays, like Christmas, forget about it. You might as well walk from home.

Downtown Walnut Creekhas almost every store you can think of, but of course, there is always another store that someone wants. In comes Neiman Marcus. They plan on building a 60,000 square foot building where a current tenant is, that obviously isn't doing too well. This building will be roughly 10% of the square footage of the entire shopping center. Here is the interesting part. Walnut Creek has a parking rule, that nobody seems to follow, but it is there. The rule is 4 spaces per 1,000 square feet. So, if Neiman Marcus followed the rules, they would have to add about 60 parking spaces. Where I ask will these parking spaces be? That is the million dollar question. Not only that, but the council also approved the increased density to the city and approved the building to ignore the current height restrictions. This is what money gets you, I guess.

There is a petition going around the city that is against the building of this project. More than 10% of residents have signed the petition, enough to bring to the table and put on the election ballot. But some of the city council members are against this petition because they feel it will be good for the city, even though it may make some small businesses fail. I am against this new store coming to Walnut Creek. We already have too many people downtown. If I wanted to live in a concrete jungle, I would move to San Francisco, which is seemingly what Walnut Creek is becoming.

Not An ATM!!!

Steve Dawson (Prudential California Realty) — Wed, 08 Oct 2008 13:53:09 -0500

This economic mess could have been prevented. I am not here to place blame, but I would like to remind everyone to live within their means.

Remember, money is not real. Your home, stocks, car, everything you own is only worth what someone will pay for it, if you plan on selling it. If you do not want to sell it, then it is worth no money. Everyday I come across people who have bought homes and now owe more than it is worth. And every time this happens, I find myself appalled at the situation. It is sickening that we live in a society that makes us feel like we have to keep up with the Jones'. It's as if we were in high school again, and the peer pressure to have a big home and nice cars and jewelry is pushing over the edge.

Please help me to understand this situation. If you bought a home 10 years ago for $250,000, and now you owe $600,000, what happened? Why did you feel that you could use your home as if it were an ATM? If you had just paid off your mortgage, then you would be mortgage debt free and only have minor expenses. And this credit crunch that we are all feeling wouldn't seem like such a big deal. Because face it, when you don't have a mortgage to pay for, your expenses are very minimal, or at least can become very minimal easily.

What really blows my mind is that this situation is not the first time this has happened to our society. We seem to make the same mistakes over and over again, never learning from the previous mistake.

So, I implore you, please don't use your home as an ATM in the future. You can't just pull money out, go on vacation, or buy a car and expect there no to be any consequences. You are smarter than that. I just have to get that off my chest. Even though I make my living by helping people buy and sells homes, I would much prefer to see people stay in a home that they are paying off, and avoid such a disaster in our economy.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

For Sellers: Try Some Of These Things When Selling

Steve Dawson (Prudential California Realty) — Mon, 06 Oct 2008 22:58:10 -0500

As Realtors, we try many things to sell homes. But sometimes I think that we forget that it is a team effort. Two heads are better than one. So, try some of these ideas to help sell your sluggish listing.

1) Remind your seller that you are a team and ask what else you could do to market their home. Don't be afraid to ask. Don't think they will start to believe you can't sell their home. They may have some creative things that you never thought of.

2) Offer a higher commission percentage. I know Realtors don't only show the homes with high commission percentage, but it sure does put the home on the list of homes to see. It will bring in more Realtors, and that in turn will bring in a higher probability of making that home sell.

3) Clean out the home. I know we all have special pictures and memorabilia that makes our house a "home." But many people will not have the same interests as you. How can they picture themselves in your home if they can't see through the clutter? Take off the unnecessary pictures and remove the extra furniture. The more open, the better. This will make the rooms look bigger, and isn't that all what we want.

4) This should go without saying, but look at the comps in the area and don't be the highest priced home, or even in the middle price range. Put the home in the lowest price range of homes. This will garner the most interest, and you may even get multiple offers and sell above asking.

5) List your home with a nationally known company. If you are going to spend thousands of dollars selling your home with an agent, why would you use Black Cat Realty, when you could use a company like Prudential Realty. Especially since 90% of home searches start online. Relocation is a huge part of selling a home. Where do you think a buyer relocating to an area will start their search? Probably on a nationally known real estate company's website. And seeing your home listed on a nationally known company's website usually makes the buyer feel more comfortable.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Big Bang Theory Being Tested

Steve Dawson (Prudential California Realty) — Tue, 09 Sep 2008 23:25:24 -0500

Have you heard of this yet? Scientist are testing the Big Bang Theory. As we all know, some people believe that the creation of all we know was created by a "Big Bang." Cosmologists say the explosion of an object the size of a small coin occurred about 13.7 billion years ago and led to formation of stars, planets -- and eventually to life on earth. So, scientists want to figure out if this could actually be true.

The European Centre for Nuclear Research has created a machine that can simulate a Big Bang. Scientists plan to smash particle beams together at close to the speed of light inside the tightly-sealed Large Hadron Collider to create multiple mini-versions of the primeval Big Bang. Of course none of us will know what happens and the nay-sayers have come out of the wood works and start shouting about the end of the world.

In this world, obviously we like to stretch the limits of our knowledge and try to understand what we already don't. But the problem I have with this is the following: this group of people are spending 9.2 billion dollars on this project. What? Why? How will this help anyone?

Let's discuss some of the other things we can do with that kind of money:

1) Cure many diseases

2) Come up with an energy efficient vehicles that don't rely on gasoline

The list goes on. I would like to know your thoughts on this matter. Do you think this is a waste of money? Do you think that this money could be spent on other more important things? What do you think?

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Open House Tips--How To Get People In The Door!

Steve Dawson (Prudential California Realty) — Tue, 19 Aug 2008 23:11:03 -0500

For those of us who still hold open houses, here are some tips to get some of those potential buyers through the door. Because we know that selling homes is a numbers games.

1) Time Your Open House Correctly

Open your house up earlier than others around you and stay longer. Don't just hang around for an hour. This makes a huge difference. If your sign is the only one around, guess where everyone will be going.

2) Give Them Something

Give them some up to date market information. In today's market, especially with the media taking down real estate, it may benefit the potential buyer to see what the actual stats are. Maybe it will open their eyes to what is really going on.

3) Have Something That Others Won't At An Open House

Like an "Open House Book." This is a book that includes a complete analysis of all homes that are for sale in higher and lower price ranges in similar locations to this property. Most likely the people who come to your open house won't buy the one your are holding open. Maybe they like the area or the price range your home is in. Give them some other things that they may like. You just might be the one who helps them buy it.

4) SIGNS

Make sure you have at least 6-7 signs up directing the people to the home. There is nothing more frustrating than not have enough signs and people are driving around looking for your open house, but they can't find it and drive away. That is a waste.

5) Advertise

This is a no brainer, but it is highly overlooked. Advertise online, advertise offline, advertise to your database, advertise to lower and higher price point people in the neighborhood. Don't overlook the power of advertising.

I hope some of these ideas can help you at your open house.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Bush Administration Wants to "Simplify" Things

Steve Dawson (Prudential California Realty) — Mon, 18 Aug 2008 12:38:01 -0500

Here we go again. How can an administration not know how to administer things? The administration wants to "Simplify" the rules to RESPA. They have tried before and have been unsuccessful, but here they are again, trying again. Here are the new proposed rules.

1) HUD's proposed regulation would penalize lenders and brokers whose up-front "good faith estimates" of settlement fees differ by 10 percent or more from the final figures at closing.

- This one makes sense. I know that we don't want our clients to pay more than they were told they had to. But 10 percent is kind of a big discrepancy.

2) The new mortgage disclosure forms would go from the current one page to four pages.

- This would hardly amount to simplification and would likely be ignored by most consumers.

3) A new, nationally-mandatory "closing script" -- to be read to all home buyers at settlement -- would add an average of 45 minutes to home sales closings, and potentially gum up transactions needlessly.

- I don't think I even need to comment on this one.

It doesn't look like to me that the admin has gotten this right yet again. Do they think about these things before they propose them? Im my opinion, these new rules would just add to problems, but what do I know?

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Top 10 Words Realtors Should Use

Steve Dawson (Prudential California Realty) — Sat, 16 Aug 2008 23:23:34 -0500

Realtors often use the same words to describe their listings. But, are those words the words they should be using? Studies show that Realtors don't use the words that consumers are searching for. Here is the list of words that Realtors usually use to describe their listings:

Here's the Top 10:

1. New

2. Large

3. Great

4. Beautiful

5. Open

6. Huge

7. Finished

8. Spacious

9. Custom

10. Newer

Below are the words that studies show consumers are looking for when searching listings:

Here's the Top 10:

1. Pool

2. Garage

3. Hardwood

4. Waterfront

5. View

6. Basement

7. Tile

8. Deck

9. Condo

10. Shop

So, next time you are describing your listing, think twice about what you think is important and what the consumer is looking for.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Housing Act--No More Gains Exemption??

Steve Dawson (Prudential California Realty) — Wed, 13 Aug 2008 08:46:38 -0500

As you may know, the Housing Act of 2008 has been passed. The new laws go into effect January 1, 2009. There are many aspects of this act, but I want to touch on one of them that may affect many people.

As most of you know, if someone lives in their home 2 out of the 5 years they own it, then they get a tax exemption of the gains, ($250,000 single, $500,000 married). This will soon change. The government is closing that loophole. The new law makes is very complicated to understand what tax advantage there will be when a person rents out their home and then wants to sell it and take the gains tax free.

The new law states,

"Gain from the sale of a principal residence home will no longer be excluded from gross income under Code Sec. 121 for periods that the home was not used as the principal residence (non-qualifying use)." The misconception will come in understanding "non-qualifying use."

Many people would buy a home, rent it out for 3 years, then move into the home for 2 years, and sell the home for a tax free gain. Come January 1, 2009, you will no longer be able to do this. The amount of gain allocated to periods of nonqualified use is the amount of gain multiplied by a fraction, the numerator of which is the aggregate period of nonqualified use during which the property was owned by the taxpayer and the denominator of which is the period the taxpayer owned the property. "Nonqualified use" for this computation does not include any use prior to 2009.

Now, the taxes on gains will be on a pro-rated basis. To understand this more clearly, here is an example:

Adam buys property on January 1, 2009, for $400,000 and rents it for two years, claiming $20,000 of depreciation. On January 1, 2011, Adam begins to use the property as his home. Adam moves out of the house on January 1, 2013, and sells it for $700,000 on January 1, 2014. The period 2009-2010 is non-qualifying use. The year 2013, after Adam moved out, is treated as qualifying use. Of the $300,000 gain, 40 percent (two years out of five years owned), or $120,000 is not eligible for the exclusion. The balance of the gain, $180,000, may be excluded. The $20,000 gain attributable to depreciation is recaptured, as required under current law.

This new law will certainly impact the way investors buy and sell property in the future.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Granite Kitchen Counters--Not the only thing

Steve Dawson (Prudential California Realty) — Tue, 12 Aug 2008 15:29:02 -0500

As we all may know, the kitchen and bathrooms are one of the most important selling features in a home. If a kitchen is done well, it will definitely create a value to a buyer. Granite counters have been very popular in the past few years, but are there are kinds of counters that sellers can upgrade to that will also leave the buyer wanting the home?

Here are some suggestions:

1) Engineered Stone. These are stone products that are generally made of 90 percent quartz, bound together by resins. It's non-porous, heat resistant and most manufacturers like Silestone, Cambria and Zodiaq offer it with a 10-year warranty.

2) Concrete. Don't think sidewalks here, these are actually handcrafted, highly engineered slabs. It's extremely durable, scratch and heat resistant. You can incorporate curves and angles, adorn it with aggregates to add sparkle, seashells, and even real leaves. Concrete is also eco-friendly which appeals to savvy buyers these days.

3) Tile. For a less expensive but dramatic change, tile can be a great choice. Available in a wide variety of colors and patterns, tile creates endless possibilities to suit surrounding décor. It can successfully and quickly spruce up any kitchen/bath space.

4) Stainless Steel. For a transformation that reflects professional, contemporary and industrial design, this is the perfect selection. Its antimicrobial, seamless, heat and stain resistant and easy to clean. You can even opt to have it brushed, textured or quilted to hide any future scratches or dents.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Should You Buy A Home Now?

Steve Dawson (Prudential California Realty) — Fri, 08 Aug 2008 12:07:14 -0500

With home prices in California declining by 37.7 percent in June compared with a year ago, some consumers are wondering if now is the right time to purchase a home, or if they should wait for prices to stabilize. Some real estate experts believe that home prices will continue to decline and that buyers should wait, while others recommend that home buyers take factors other than price into consideration, such as the benefits of owning versus renting.

Here are some things to consider:

1 ) Consumers who are hesitant about purchasing a home today because they fear price depreciation, need to understand that real estate is cyclical and that prices will increase again. Home buyers should view a house as a long-term investment and not be fixated on short-term prices. Some economists believe that consumers should purchase a house if they plan to live in or hold the property for at least seven years. This will allow the market to stabilize and homeowners to possibly profit from their investment, if they decide to sell.

2) Although a typical monthly mortgage is higher than a rent payment, home buyers who qualify for a fixed-rate mortgage, such as those backed by the Federal Housing Administration, will have consistent monthly payments, while renters are generally subjected to annual rent increases. And, since many people are holding off buying a home and still have to live somewhere, the rental market is increasing their prices. Supply and Demand. Mortgages also can be paid off and the house can be owned free and clear, while renters will consistently have a monthly payment.

3) To help home buyers lower the financial risk of homeownership, experts recommend that consumers purchase a home within their means and have enough in savings or other assets to cover the mortgage payment for at least six months if they lose their job.

Remember, each person needs to make a decision that is right for them. Think about it before you jump the gun on anything. Real Estate is a huge undertaking. Don't just rush in a buy now because you see a lot of other people jumping back in. Look at your situation, and make good decisions.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Current Foreclosure Problem Just Tip Of Iceberg?

Steve Dawson (Prudential California Realty) — Fri, 08 Aug 2008 11:56:47 -0500

The first wave of Americans to default on their home mortgages appears to be cresting, but a second, far larger one is quickly building.

Homeowners with good credit are falling behind on their payments in growing numbers, even as the problems with mortgages made to people with weak, or subprime, credit are showing their first, tentative signs of leveling off after two years of spiraling defaults.

The mortgage troubles have been exacerbated by an economy that is still struggling. Reports last week showed another drop in home prices, slower-than-expected economic growth and a huge loss at General Motors. On Friday, the Labor Department reported that the unemployment rate in July climbed to a four-year high.

While it is difficult to draw precise parallels among various segments of the mortgage market, the arc of the crisis in subprime loans suggests that the problems in the broader market may not peak for another year or two, analysts said.

Defaults are likely to accelerate because many homeowners' monthly payments are rising rapidly. The higher bills come as home prices continue to decline and banks tighten their lending standards, making it harder for people to refinance loans or sell their homes. Of particular concern are "alt-A" loans, many of which were made to people with good credit scores without proof of their income or assets.

"Subprime was the tip of the iceberg," said Thomas H. Atteberry, president of First Pacific Advisors, a investment firm in Los Angeles that trades mortgage securities. "Prime will be far bigger in its impact."

Delinquencies on mortgages tend to peak three to five years after loans are made, said Mark Fleming, the chief economist at First American CoreLogic, a research firm. Not surprisingly, subprime loans from 2005 appear closer to the end of defaults than those made in 2007, for which default rates continue to rise steeply.

Data on securities backed by subprime mortgages show that 8.41 percent of loans from 2005 were delinquent by 90 days or more or in foreclosure in June, up from 8.35 percent in May, according to CreditSights, a research firm with offices in New York and London. By contrast, 16.6 percent of 2007 loans were troubled in June, up from 15.8 percent.

What will sting borrowers more than rising interest rates, analysts say, is having to pay interest and principal every month after spending several years paying only interest or sometimes even less than that. But now, some borrowers could see their payments jump 50 percent or more, and they may not be able to sell their properties for as much as they owe.

Prime and alt-A borrowers typically had a five- or seven-year grace period before payments toward principal were required. By contrast, subprime loans had a two-to-three-year introductory period. That difference partly explains the lag in delinquencies between the two types of loans, said David Watts, an analyst with CreditSights.

"More delinquencies look like they are on the horizon because so few of them have reset," Mr. Watts said about alt-A mortgages.

Delinquencies in prime and alt-A loans are particularly challenging for banks because they hold more such loans on their books than they do subprime mortgages. Downey Financial, which owns a savings bank that operates in California and Arizona, recently reported that 11.2 percent of its loans were delinquent at the end of June, a big increase from the 6.1 percent that were past due at the end of last year.

The bank's troubles stem from its $6.2 billion portfolio of so-called option adjustable-rate mortgages, which allow borrowers to pay less than the interest owed on their mortgage in the early years. The unpaid interest is added to the principal due on the loan, so over time borrowers can owe more than the initial loan amount. Eventually, when loans grow by 10 percent or 15 percent, the borrowers are required to start paying both the interest and principal due.

Many borrowers who got these loans during the boom had good credit scores, but many of them owe more than their homes are worth. Analysts believe that many will not be able to or want to make higher payments.

"The wave on the prime side has lagged the wave on the subprime side," said Rod Dubitsky, head of asset-backed research at Credit Suisse. "The reset of option ARM loans is a big event that will drive the timing of delinquencies."

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572

Blackberry vs. Pilot

Steve Dawson (Prudential California Realty) — Tue, 05 Aug 2008 16:25:54 -0500

Okay, so I am hoping to get some suggestions here. It is not a big deal, but I wanted to see what your experience was.

I am deciding between the pilot and blackberry. Both seem to work great. They both have good task managers and schedulers. Now here is my problem. I have Verizon and if I get the balckberry, I have to pay a monthly fee of about $40 to use the interenet and email. If I get the pilot, I don't. I could pay per use, if I need it, but it would probably cost me more if I use it all the time.

Right now, I don't use any form of email or internet on my phone. If I got a phone that worked like a blackberry or pilot, I may start using it. I just wanted to get your opinion of the two and which you think would be best for this business. I know I am only talking about $500.00 more per year for the service, but since I am already paying over $1,300 per year for my phone, I would rather not spend too much more if I don't need to.

Lease Option Agreements

Steve Dawson (Prudential California Realty) — Tue, 05 Aug 2008 16:12:17 -0500

As you may know, lease options are becoming more popular right now for those who want to sell, but are desperate and could hold onto their property, but don't want to give it away. So, along comes a lease option. Definitely an advantage to a seller or owner than the buyer or renter, even though the buyer is in control of the situation.

But with lease options comes some questions that you may want to consider during the transaction. Here are some things you may want to do:

1) Who is responsible for insuring the property while it is being rented?

2) Who pays the property tax?

3) Must the rental money or consideration money be put in an escrow account?

4) What happens if the tenant/buyer damages the property and then decides not to buy?

5) Is the property under rent control?

6) How big is the deposit and consideration money?

These are only some of the things you need to consider before entering into a lease option agreement.

If you are considering selling your home or purchasing real estate in Contra Costa, you owe it to yourself to contact Steve Dawson for all your real estate needs in the East Bay.

"Whatever It Takes"

Search over 14,000 listings in the East Bay

www.SteveDawsonRealty.com

925-788-7572