San Diego California Real Estate- Update on HVCC crisis affecting San Diego Homeowners

In my recent post discussing some of the difficult problems with the HVCC rules implemented in May 2009, I received this bulletin forwarded from a  local mortgage broker here in San Diego. In involves a new bill before the House of Representatives to suspend for 18 months the new HVCC guidelines that affecting the quality of appraisals here in San Diego and across the nation. Here is the bulletin I received last night.

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NAMB APPLAUDS BILL TO SUSPEND HVCC
IN NEWS - RESIDENTIAL MORTGAGE
BY JOHN CLAPP ON TUESDAY 30 JUNE 2009


The Home Valuation Code of Conduct (HVCC) may be suspended for 18 months, if one recently introduced piece of legislation has the legs to move through Congress. H.R.3044, introduced by Rep. Travis Childers, D-Miss., on June 25 and co-sponsored by Rep. Gary Miller, R-Calif., looks to impose a year-and-a-half moratorium on the heavily debated appraisal code.

Last week, National Association of Realtors Chief Economist Lawrence Yun suggested that “faulty valuations” slowed home sales transactions in May - the month the HVCC became effective.

H.R.3044 has found the support of at least one trade group, the National Association of Mortgage Brokers (NAMB). The organization’s president, Marc Savitt, released a statement urging Congress to swiftly pass the bill.

“In the period of time since its implementation, the HVCC has increased costs to consumers and decreased the quality of appraisals, and has provided a level of uncertainty in an ailing housing market,” Savitt said in the statement. “Tens of thousands of consumers have already been robbed of their opportunity to enjoy historically low rates by Attorney General Andrew Cuomo’s rule.”

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Here is the a link to the article I wrote here in ActiveRain discussing how these changes are affecting many appraisals affecting the sale of real estate.  My post was titled " The Unintended Consequences of Change".

San Diego California Home Owners - Energy Saving Tips For A San Diego Summer

San Diego has been enjoying moderately cool temperatures of late but  heat will be returning soon and here are some ways to conserve energy that can be implemented now and help you remain comfortable as the heat begins to rise. While the San Diego climate is moderate year around, in the summer, our temperatures can very warm especially inland and away from the coast.

Living in San Diego, we need fans to circulate the wonderful breezes we are get living near the ocean. But if your windows are closed up and if you have no fans, you are missing one of the best features of living here in San Diego. Ceiling fans today are a very affordable alternative to air conditioning and reasonably easy to install.

So for starters lets turn off the air conditioning on those days when the temperature starts rising into the high 70’s and 80’s. Open up the windows and turn on the fans. Costco sells these portable misters and a quick shot on the face or neck and you will be cooled right down. The Misting Mates are made for outside, but if you don’t tell, I won’t. And don’t fear getting wet, just take a quick spray and with the air being circulated through your home you will feel very comfortable.

I would recommend that you invest in a programmable Thermostat. These can be purchased in the range of $30. You will save an energy costs the first year, as much as several hundred dollars. In a few years, we’re talking real money.

The cost of a new energy wise air-conditioning system on average runs in the range of  about $2500-$3000. It will only take a few years to earn all that savings back and there may also be some local and state tax incentives for upgrading. Making a phone call to your power company and following that up with a couple calls to the leading HVAC suppliers should give you all the information and related contact information you need.

Installing a whole house fan will also dramatically help lift up and out, a lot of warm air trapped near your ceilings or in your upstairs level. You will notice the change rather immediately once this is installed.

In the hottest summer months, lower the temperature on your water heater. The recommended temperature should be somewhere between 110 and 115°. Taking cooler showers will also make you feel cooler and save a lot of energy.

Consider doing most of your cooking outside on the grill. It keeps the house a lot cooler and saves boatloads of energy. Besides that clean up is a lot easier and you save using so much hot water in cutting the cooking grease that most of which burns off. I won't get into the potential of the increased carbon footprint at our homes because of the additional smoke we create when cooking outside but I do think this is a real energy saver. It's not like the smoke billowing from an energy plant.

Wash clothes in cold water. Even the dirtiest whites will come clean with the warm setting. Be sure to also reduce the amount of detergent. Less is more in most cases.

The summer months provide so many wonderful activities for outside. Turn off the TV or at least try watching it less. This may be too much of an editorial but I think we could all use a break from our TV's and computers alike. Turn em off and enjoy the fresh air, family and friends.

Overhead recessed lighting also generates a lot of heat and using these lights less will cut down on your energy bills. There is one way however that is proven to be very cost-effective. Change out all those incandescent bulbs to the new low-energy fluorescent. These bulbs may be a little more costly up front, but they last longer and they virtually give off no heat. Check with your city power companies. They have periodically set up free exchanges and that makes these new bulbs virtually free.

There are some other more permanent and longer range ways of economizing on energy. These would include having your home well insulated and it saves a ton of money on energy costs year around. Good insulation could cut your energy costs as much as 30% a year there is a website, simply go to insulate.com that would help you get even more ideas.

A good landscaping plan of planting leafy trees on the southwest side of the house will help the extreme heat from overheating the house. In the winter months after all the leaves have fallen, the trees allow the sun to keep the house warm. It’s also wise to avoid excessive use of rock, concrete and especially asphalt, particularly on the west and south side of the house. This heats up with the sun and radiates heat to the house making it even more difficult to cool.

The south and west sides of your home as I  mentioned gets the most sun and the heat can be reduced significantly by installing white blinds on the windows. The sun and heat are reflected back off of the windows and helps to keep the house a few degrees cooler as well. I have two curved windows that have no covering in the dining room. I located an opaque film at Home Depot and it looks handsome and does a great job in preventing the late day intense sun from damaging the fabrics. It also feels cooler with the direct heat of the late day sun. In the winter months, I simply remove it. In the Spring it goes up again.

There are many other heat cutting and energy savings ideas. If you know some, send me a comment and I can add them here. Thanks for sharing.

Editorial NOTE: A top real estate professional gave me a great suggestion to stay cooler in the summer months and also save energy and I am going to add it here. This is from Renee Burrows in Las Vegas.

GO TO THE BEACH

The Story behind these gardens. Pierre Dupont came to this country from France in the early 1800's. He founded the Dupont Chemical factory and created even more wealth. When this property was for sale , he acquired it because it represented one of the largest tree collections to be found in the US. That is just the beginning of the amazing story behind what is seen today as one of the largest Gardens in the world with over 1000 acres of tress, shrubs and flowers. And that doesn't even begin to describe the water features and one of the worlds largest flower and plant Conservatorys. It defies words to describe.

San Diego Real Estate - How Often Do You Check Your E-Mail

I find it fascinating and a more than bit irritating trying to reach agents with offers or inquiries to even be able to write them. They don’t seem to return phone calls nor do they respond to even having received offers.

There are a few agents that seem to be able to get away with Bankers hours. Nor do they work weekends. It doesn’t take that long to return a phone or even answer an e-mail. But not to even acknowledge the contact, drives me up a wall. For you visual types, that ain't purrrdy.

I have noticed in our ActiveRain network, that people are engaged at all hours. Why should it is earlier for me to reach an agent in Hawaii than it is here in own home town of San Diego?

I must be becoming impatient or something and the real stress for me in this industry is not being able to reach my colleagues. If a client wants me to write an offer and I have it is ready by 7PM in the evening, I find it a bit disconcerting that when I call and identify why I am calling, I may not hear back untill late the next day or even later. I understand people have a life and mine happens to be real estate but they don’t seem to even check their e-mail.

I think this is a question that a Seller should ask when listing their property. When are you available? When do you return calls to us and others that are making inquiries on my property. How often do you check your e-mail and do you respond when you do check it?

I don’t know about you but 5:30PM is not after hours for me and I resent it when the agent says they don’t return calls till between 11:00 and noon and between 4:00 and 5:00 each day. And they don’t return calls or e-mails on weekends at all. If they don’t want to be bothered, they need to hire someone to do that for them. In my view, this is just plain arrogance. In my estimation they are not fit to even be in business much less an industry that requires a certain level of responsiveness.

And when we do reach them, we have to be so damn polite about it, lest we damage our potential relationship during the transaction.  Pardon my rant, I know here in the Rain, I am preaching to the Choir.

While visiting back East for the past 10 days, I took in some of the most beautiful sights I have ever seen. This water fall at the Bushkill Falls high up in the Pocono Mountains in PA required quite a steep hike down winding trails but as you see well worth the adventure. The color of the water here is that of root beer and it gets its color from the tanic acid in the soil from the abundance of Hemlock trees. These Main falls are often referred to as the  Niagara Falls of Pennsylvania. This is the larger of a total of 8 falls to be discovered in this extraordinary scenic mountain retreat.

In San Diego, we have become quite accustomed to Bank Foreclosures throughout the area. And as things begin to ease a little in the housing markets, the residents of San Diego have a new little monster to stare down and deal with, rising water bills with mandatory curtailment of water use.

Barring a month of steady daily rain, San Diego homeowners are entering an era in which water usage is going to become an issue as significant as what we have been facing in the current mortgage and housing crisis.

While we are seeing the mortgage and housing crisis beginning to ease a bit in the San Diego real estate markets, it is almost beyond comprehension for it to be replaced by an epidemic of water bill foreclosures.

Now that we have our mandatory water conservation and water use curtailment under way, looming large on the horizon is the prospect of water rationing. And for those that have plants that survive the current water cut backs, it is very possible they will start to scream, " Save Me", "No, Save Me, My blooms are bigger", "But I am drought tolerant", "Don't believe him, he is tapping into the water main".

What's our choice to become? Choosing between a desert landscape of sand and cactus or plastic grass?

If that isn't isn't bad enough, we may soon be forced to take family showers in the next stage of cutbacks and it doesn't end there. It might get so bad that in order to have water to wash dishes, bathroom habits will necessarily have to change ( an unthinkable solution whose time may be coming soon). Low flow flushing may have to once again be redefined. This time with no rebates.

In the latter stage of mandatory cutbacks we may ultimately need to implement water use multitasking. While the sprinklers water what little living grass we have left, it may become necessary to fit in our daily showers using an organic fertilizer based body wash and shampoo combination. Additionally, washing dishes in the water sprinklers also with an organic fertilizer dish soap, brushing out teeth and filling the coffee pot, all on our allocated 10 minutes per station, 3 times per week lawn watering.

And failing to implement anything less than this new creative conservation of water multi taking effort , could  result in fines that may exceed the typical mortgage. And if the water bills keep getting bigger and they surely will, we could also start to see Real Estate For Sale signs in our neighborhoods that read " Water Bill Foreclosure". Don't laugh, it could happen!

Well, Yes, I have been talking pictures since my Brownie camera lots of years ago. There is something about kids taking pictures and seeing them after they are developed that sort of addicts us to wanting to take pictures of just about anything and everthing.

Through the years I have had many excellent cameras but this time, I wanted something special. I have seen here in the Rain such amazing photos and being a visual type of person I wanted to be able to do them as well. And I was tired of cracking my elbows on door frames trying to get pictures of bathroom on my listings. They are important and my camera ( a Casio S600 Excilim) just won't take those kinds of pictures that are useful in tight situations.

Since I recently got a new camera, an SLR Digital Pentax with Telephoto and Wide Angles lenses, along with the camera I am taking courses on how to take pictures, learning all the settings and some of the things that are possible with a digital SLR camera.

Here is one of my first efforts below. Over time , I expect that I will get a great deal more proficient and it will be fun to do posts of amazing pictures like ActiveRain members Susie Blackmon , CJ Johnson and so many other talents here in the Rain. If this Bee would have been still for a second, I'd a had him but he tried to sting me on the only thing he could see, my nose. But I was too quick. Next time I might take a picture of something that doesn't want to bite me, LOL. But he sure had a cute proboscus. I guess I was too focused on tailend where is stinger is to get a better focus.

For years now we have heard all about the changes in our real estate industry from Lending issues, inspections, forms and disclosures, the marketing of properties, lead generation, you name it it has changed.

In a comment to Lenn Harley, I suggested a new definition of this change. Change is when something happens that you didn’t want to happen but must now adapt to it ( as in, just live with it). Some have wished that we could continue to do business the way we used to do business. The answers that come opposed to that recent way of thinking and doing things are from those that were able to adapt and take advantage of modifying their business and doing it early.

At the time of the sub prime crisis, many were faulted and to head off the possibility that this scenario of runaway home prices could happen again, the entire system of lending basically collapsed and is being refashioned not necessarily by those that would be the mos skilled at it.  Along with the lending underwriting changes, another segment of the industry not always thought of as the one segment that actually facilitated the ballooning of property values has also been modified. The appraisal.

Not to leave a single stone unturned, in May of this year,  new rules were put in place to make sure that appraisers do not facilitate an inflation of values from getting out of control again. Or so that is the way the changes are being justified.

The appraisers were as a group charged with having been too greatly influenced by lenders to facilitate values to get the deal done. Well not any more. In making the new changes much more onerous than the older much easier to understand lending guidelines, appraisers were said to have a “too cozy” of relationships with lenders and that must now be prevented. The appraisal was always by definition to be an arms length estimation of value, and the arms length part seemed not to be long enough. My image immediately went to those shorter furry animals that often walk with their hands. They have long arms.

Just how that is too happen was the subject recently of Real Estate columnist Kenneth Harney’s article  on what the new appraisal rules mean to the industry and the consumer. What are the expected and unintended consequences of these changes?

In as much as the appraisers had that “too cozy” relationship, it was decided that lenders must now choose from a pool of appraisers on a rotating basis instead calling on their trusted relationships with known appraisers of the past. In the arbitrary selection process, it is thought that there will no longer be any possibility of strong arming by the lender to have the appraisal “ came in”, a term that implied that the value the Buyer agreed pay  would be the value that the appraiser would also see minimally as the estimate of value.

Kenneth points out several of the unintended consequences of these new appraisal guidelines as released by Fannie Mae. Since lenders are no longer directly involved with the appraisal process, the fees now have to be charged up front and can no longer be just a part of the loan costs at settlement. That now takes the form of the Buyer having to supply a credit card payment up front. The appraisal fee that used to cost $325 now goes for in the range of $450. That adds up to a 20 to 30% increase in costs for the consumer to pay for the same service that might not be performed as well.
Kenneth further noted that we should not assume however that this increase in fees paid actually benefit the appraiser, it often goes to new appraisal management companies that facilitate the processing of the appraisal assignment and management including the processing costs.

If this sounds like we added another new layer in the real estate transaction, if it walks like a duck and quacks like a duck, not much use in thinking of the possible exceptions like its a goose with a bad cold. Since these management companies decide what the fee will be and job out the actual appraisal and they handle the management and requirements of the who, what, and when, you can expect that their costs will over time escalate and be justified that their costs are higher and the appraisal cost will go up as demand goes up, just like other services. Whoever thought all this up is definitely overpaid.


As independent contractors and to protect the profitability of the new management companies, there is also the likelihood that new appraisers who might work for less will push the more seasoned and experienced appraisers out of the business.

The real unintended consequence of these type of changes is a greater likelihood that appraisers will not be familiar with the uniqueness of the local areas and will not be as capable of making the correct adjustments. Appraisers that typically worked certain areas and were expert in valuations may be a thing of the past. And that happened over night. Talk about unintended consequences.

So lets recap this. In the past, local real estate professionals knew better than most anyone what the value of property was in the neighborhoods they specialized in. Not anymore if the stories coming in are correct. We based our estimate of value with our Seller's it on comparable sales with adjustments for particular characteristics or even unique area characteristics and our opinions of value had most often been validated by knowledgeable appraisers. Those days, may also be over. Now, we must relearn what the respective value is from persons that may never have even been in any particular area before. And don’t go taking it out on the appraisers, they most likely had very little influence in these changes.

Oh and as for those thinking that you can share ( influence)  with the appraiser what you think they don’t know, better think twice before doing that. I am sure you don't need to ask why.  Ahh, the unintended consequences of change.

10,000 Comments Made

This isn't about points or position. I made a goal to make 10,000 comments here in the rain and do so prior to June 1,2009. I am delighted that last evening, I posted that the 10,000th comment.

Of those ten thousand comments, one comment was over 1000 words. Literally over a page and a half in length. Of the ten thousand comments, well over two hundred would have qualified better as posts instead of comments. I guess I can get a little wordy now and then.

Of my readers and those I read on a regular basis, I think this was a goal that was more testament to the kinds of content we have here in the Rain. From the great tutorials, , literally classes on Short Sales and Reo's , Photography tips and guides, lots written about SEO, Ethics, Video, and more resources than most any of us could ever find on our own. Testimonials about the services , like Market Leader, Localism guides, you name it we have it. And that doesn't even begin to define the great listings, Local market reports, local things to do, events, and especially now " all about Social networking" on Twitter and Facebook.

With so much to read and learn from and so much to write about, the comments are there to add viewpoints, shared experiences, adding more insight  and most of all  to support my many friends and colleagues here in the Rain.

So I am very pleased that I made it this far and I am about to set new goals and will share them as well. I actually had people mentioning this to me the last few days helping to keep me on track. Here on ActiveRain, one never has to ask " What are friends for". I am here to be your friend and welcome your reciprocal friendship. Thank you all for bringing such great writings  to the Rain and sharing them for all the rest of us to read and learn from. This blogging and commenting is an amazing life experience and I am so glad I am not missing it.

This past week provided me a very special and rare experience of being an invited lunch guest by a patron of the Golden Door, The World famous Health Spa. From the moment the front gate opened, you feel the exclusive nature of this amazing luxury spa. Set on over several hundreds acres of the most  magnificent grounds, one is easily taken in by its sheer beauty and tranquility.

A family friend who frequents the spa with annual regularity, invited me to join her and her two daughters for a specially prepared lunch at the koi pond. The stylings at this spa opened since 1958 are of the Japanese Honjin Inns famous in Japan. And as far as I could tell, from style of the architecture to the sheer beauty of the surroundings, that I just as well could have been in Japan.

Tucked away in an area north of Escondido, the location of this exclusive spa would be missed unless you knew exactly how to get to to it. There are no signs and if you have to ask, you probably wouldn't be on the list for visiting.

I brought my camera to take some pictures but as you see there are no pictures here. Out of my respect for it’s exclusive nature, nothing I could take pictures of could even come close to capturing what I was taking in using all of my senses. Pictures even with my written description could never do justice to what I was experiencing. The Golden Door has a web site and they even have a picture gallery but I can tell you from my own eyes, the pictures they include don’t even come close to the splendor and tranquility of the magnificent surroundings. The entire experience can not be expressed in pictures anyway. The total of all your senses would be needed to fully appreciate.

The luncheon was served by the coy pond in a setting that was almost hypnotic in its calming beauty. The attention to details as well as the lunch itself was unlike anything I have experienced. I was gifted the while there the Golden Door Cookbook signed by the world famous executive chef, Michael Stroot. It contains over 200 recipes of what the patrons of the this most exclusive spa experience 3 times a day while there are a guest.

My impressions of this most tranquil spa was that of a trespasser, wondering if my mind would make any disturbing noise as took it all in through my senses. A magnificent place and I hope I am invited again and again as my family friend makes her annual pilgrimage for a week of de-stressing and pampering at this most celebrated  spa.