County of Castles: Orange County Real Estate Blog

Some news for troubled homeowners

Cindy Kalionzes (no current broker affiliation) — Mon, 15 Feb 2010 16:23:10 -0800

Someone just shared this article with me, and I thought I would pass it on. It's about a strategy to "buy time" during the foreclosure process by requesting that the lender produce a copy of the loan paperwork. Article here

Summer's heating up!

Cindy Kalionzes (no current broker affiliation) — Fri, 24 Jul 2009 18:04:55 -0700

My goodness, it's been warm lately! Well, that's July for you. As Disneyland celebrated its 54th birthday last week, we were enjoying temps in the 90's. But that's not all that seems to be heating up. While the market's certainly nowhere near as "hot" as it was in the peak of the bubble, word on the street is things are starting to warm up a bit for the lower price ranges (homes within FHA loan limits). Investors are beginning to jump in and take advantage of some of the great deals to be found these days. The $8000 tax credit is only until November 30th (NOT the end of the year as some believe), so if you're sitting on the fence, it's definitely time to take action!

Reflecting on the markets

Cindy Kalionzes (no current broker affiliation) — Fri, 10 Oct 2008 09:46:57 -0700

Wow, what a roller coaster ride the last week has been! The Dow has been all over the place (okay, mostly down) the last few days, banks have folded, and many stockholders have been watching their depleting retirements drain away. Okay, enough bad news, what's the good news? These are the markets where fortunes are made, my friends. I believe it was Andrew Carnegie who said (in response to a query as to why he was so rich), "I buy my straw hats in the winter." Well, welcome to the blizzard. I find this quote particularly relevant since winter is also historically the lowest point of buyer activity in the real estate sales cycle. But what does all this mean for buyers? Fewer other buyers on the market + more sellers not getting their homes sold = more bargaining power for anyone who IS buying! Now, of course the major challenge at present is financing, as the credit markets have seized up. But don't eliminate yourself before getting in the game. TALK to the banks, see if you can get pre-approved (pre-APPROVED, not just pre-qualified). Once you're pre-approved, it's time to go hunting for a deal. Remember you don't have to take the first thing that comes along. Be willing to walk away from deals that aren't realistic. But at the same time, educate yourself on the overall market for what you're buying. The truly great deals still disappear quickly, so you'll want to be able to spot a good deal when you see one. From an investment standpoint, with no known end in sight to the current market conditions, you'll obviously want to pursue properties which can cash flow for you right away. Remember that there is more than one way to make money from a property. Ideally, if you are making money by renting it out for more than your mortgage plus expenses, that's great. And if you put enough down on a property, you can make this happen. But another way that your property helps make you money is through savings on your taxes. Always run this one by your accountant, but do not ignore the financial benefits of acquiring a significant writeoff. Saving money that would otherwise go to the tax man is another way to increase the overall financial picture. Just remember to pencil it all out. Not every property is going to cash flow immediately, but the deals ARE out there, if you're willing to do your homework and walk away from the deals that don't pencil out, you can build your fortune in a market like this.

Just when you thought you couldn't buy a cardboard box for less than $200K...

Cindy Kalionzes (no current broker affiliation) — Thu, 01 May 2008 11:31:30 -0700

$142,500What would you suppose that money would get you in Orange County today?........If you guessed nothing, you're in good company, but you're wrong. Trust me, I'm as floored as you.Would you guess a 2-bedroom condo a mile from Disneyland? I was conducting a search for a first-time buyer client of mine, hoping to find her a unit in the "under-$200k" range, and was shocked at the results. Even after eliminating all the short pays there were still 17 2-bedroom (or more!) units available in Anaheim.This is particularly exciting in Anaheim as they have some excellent first-time buyer programs for people who work or already live in the area. Buying can be quite literally cheaper than renting right now.

The psychology of trees

Cindy Kalionzes (no current broker affiliation) — Fri, 25 Apr 2008 06:24:38 -0700

Lets talk about trees for a moment, shall we? After all, I can think of no better way to celebrate Arbor Day than by praising the tree and its impact on real estate values.Here's an article I just found talking about the efforts on the part of city leaders to increase the number of trees in their cities, calling them "green infrastructure". From a city perspective, more trees helps reduce energy usage by increasing shade, and help to counteract the emissions from vehicles. In fact, the City of Los Angeles has resolved to plant a million new trees (an ambitious goal, given the inhospitable environment). One thing that city leaders have learned in the process of trying to plant all these trees is just how little room their cities have to accommodate the introduction of trees. Poorer areas are hit the worst, with almost no spare room and the least tree coverage. Wealthier areas, by contrast, have the highest amount of tree coverage.So what do we take away from this? The inherent value of the tree-filled neighborhood. This is also true on a house-by-house basis, with many homes promoting their yards full of fruit trees as an amenity to attract buyers. Something to think about this Arbor Day...So why don't you get out there and plant a tree in your neighborhood? Happy Arbor Day.

Get Your Property Taxes Reduced!

Cindy Kalionzes (no current broker affiliation) — Thu, 17 Apr 2008 11:17:47 -0700

If you bought your home in the last couple years, there's a better-than-fair chance that your home is now worth less than what you paid for it. So why are you still paying taxes based on what you bought it for?Section 51 of the California Revenue and Taxation Code states that the assessed value of any real property shall not exceed its market value on the January 1st lien date. So, if the market value of your property on January 1, 2008, was less than the assessed value as it appeared on your last annual assessment roll, you can make a request that they review your assessment. What this means is, they may reduce the assessed value of your home, which will result in a reduction in the property taxes you owe this year. No, the reduction is not retroactive, in that it will not result in a reduction of your taxes for 2007, but it will help you out going forward.But here's the rub: the due date for these requests is APRIL 30TH. So you must get your request in ASAP. You will need to fill out the request form and have it delivered or postmarked by that date.Here's where I can help. In order to fill out the form, you will need to provide Comparable Market Data Information (yes, it's a redundancy in terms, but that's our government for you!). What they mean is that you need to provide recent Sold comps for your property. This is recent sales in your area on homes similar to your own, to help provide an estimate of the current market value for the property. I can help you get this information. Call me today! (949) 468-8405 or email me at clamb@homesoc.com.Here is the form you need to send to the Orange County assessor's office.More info from the assessor's office.

Preparing to be a homeowner (article)

Cindy Kalionzes (no current broker affiliation) — Fri, 04 Apr 2008 10:06:34 -0700

I just found a pretty decent article on steps to take as much as a year before becoming a homeowner. I think it's a fair primer on home-buying readiness.Of course, the overwhelming message of the article is that you need to be thinking loan first, house second. I keep trying to emphasize to my clients that they need to get themselves pre-approved by a lender so that they know how much house they can afford, and that they'll be ready to buy a good deal when we find it. Getting ready to buy a home (article)

Taking it all off!

Cindy Kalionzes (no current broker affiliation) — Wed, 26 Mar 2008 19:11:37 -0700

I received a lovely compliment from a fellow agent the other day. He presumed I was in my early 20s. I thanked him but informed him I am actually in my early 30s. To most women, this is a huge compliment, but I found it just a little disturbing. How is anyone to take me seriously if I look like I'm some college student?So I cut my hair. I must admit, I had already planned to do it, but it underlined the seriousness of my professional need to do something about my look.Here's the before: And Here's the after: At long last, I actually look my age.

The sun is shining, it's a lovely day

Cindy Kalionzes (no current broker affiliation) — Wed, 26 Mar 2008 11:35:07 -0700

Perfect house hunting weather. The sun is shining, it's a mild 70 degrees out, and all the hills within eyesight are lovely shades of spring green.Good house hunting weather is also good open house weather! It's time to get out there and find the perfect home before everyone else does.Gotta love spring in Southern California!

Demand is rising

Cindy Kalionzes (no current broker affiliation) — Fri, 21 Mar 2008 11:04:02 -0700

This is what I've been blogging about. Here's a snippet from my company's latest Market Time Report,"At the beginning of the year, demand, a snapshot of the last 30 days of escrow activity, was at 944 escrows. Today, demand has increased by an additional 1,139 escrows to 2,083."That is... UP BY 121%What of prices, however? Still low! I think we will have a couple more months before prices start following demand back up. It will depend on how the recently-released new FHA loan limits affect demand for properties in different price ranges. Right now, REOs (bank-owned foreclosures) still lead the market. Buyers are already seeing the best-priced properties getting snatched from their grasp by other buyers. This is not the time to step over quarters to pick up pennies. Be ready to act on a property you know is the right home for the right price, or someone else will.I think the back half of this year will be a significant improvement upon the front half. Demand may peak late this year, around Fall, as people realize they must act while they can (as of this writing, the raised FHA loan limits are only set to remain so until year's end).The smart buyer would be looking for deals now, before there is too much competition to get the best price.

Information for troubled homeowners

Cindy Kalionzes (no current broker affiliation) — Thu, 13 Mar 2008 05:07:53 -0700

The government's "Hope Now" hotline is open 24/7 to receive calls from homeowners who are having trouble keeping up with mortgage payments. It's a free service that helps borrowers get in touch with the right people at their lenders to try and either work out a payment plan or modify their loan terms. The program has been met with mixed reviews, in terms of its effectiveness, but if you're a troubled homeowner who is concerned about losing your home, it's certainly worth a call to see if they can help.There are other housing groups and counseling agencies who work with homeowners at risk. Just make sure that whoever you're dealing with is certified by the Department of Housing and Urban Development (HUD) or the National Foundation for Credit Counseling.Hope Now hotline 1-888-995-HOPE www.995hope.org Homeowner Crisis Resource Center 1-866-557-2227 www.housinghelpnow.org

Why 2008 is THE time to be buying

Cindy Kalionzes (no current broker affiliation) — Thu, 06 Mar 2008 10:16:30 -0800

It's finally official. FHA loan limits have temporarily been raised to over $700,000. For the first time in a very long time, regular Californians can buy a regular home with a regular (non-jumbo) loan.And prices are down, way down. In some cases, bringing the cost of renting and the cost of buying fantastically close to eachother. Case in point: a 3-bedroom apartment in or near Mission Viejo, according to those available on apartmentguide.com, will run you upwards of $2300. Compare that to a particular condo development I am aware of, whose values have plummeted (due to a high incidence of foreclosures, putting downward pressure on pricing), to the point where you can get a 3 bedroom, 1 1/2 bath townhome with 1-car garage for as little as $250,000. At a 7% interest rate, the principal and interest on a 30-year loan for that amount will run you about $1663/mo. Add in around $300 for the HOA and account for property taxes, and you're still running right around the cost of renting - BEFORE you account for the enormous tax breaks that come with being a home owner! Oh, and by the way... the national average interest rate (according to MSN.com) is 6.01%, not 7%.Is this the case everywhere? No. But it CAN be done. Even in nice areas like Mission Viejo.The point you should really take away from this story is this: this is a great time to get into a home.And like all good times, it's not going to last forever. The FHA limits are only set to remain at their new levels for the duration of 2008. Prices, while they may yet drop a bit more, are likely to stabilize soon, as action picks up in the market (and action IS picking up in the market... more buyers are taking advantage of current pricing to get into a home). Already, many were calling for an unusual buyer activity pattern this year, with fall being predicted as the year's high point (usually market activity peaks around May, this year some are predicting October). I believe, with the FHA loans only set to go through 08, as we get closer to the end of the year, more people will realize that they need to get in and take advantage of it while they can. Prices will not keep dropping in such an environment, so the smart buyers are getting into the market now or in the next couple months to minimize competition for the best-priced homes.Nobody knows what 2009 will bring, except a new tax year. This brings me to my final argument for buying in 2008 "while the iron's hot"... you can get write-offs on this year's taxes. Even if you wait until the very last minute to decide that this is the year you buy a home, try to close before the year ends in order to take advantage of the write-off. Talk to your accountant to get an accurate picture of just how significant that write-off can be.

OCTA Invites Public Feedback on Transportation Solutions

Cindy Kalionzes (no current broker affiliation) — Tue, 04 Mar 2008 08:45:56 -0800

It's always nice when our government wants to hear what we think before spending our money. We should take advantage of the opportunity and get involved.OCTA (Orange County Transportation Authority) is looking at six alternatives for major projects addressing our transportation needs. In the interest of gaining public feedback on the recommendations, OCTA is hosting 3 "open house" meetings, the first being tomorrow, March 5th. That open house will take place from 5:30 to 7:30 p.m. at the Laguna Hills Community Center Heritage Room, 25555 Alicia Parkway, Laguna Hills. A second open house will be held at the same time the following day (March 6) at Lake Forest City Hall, 25550 Commercecentre Drive. Th third open house will be held on March 11, at R.H. Dana Elementary School at 24242 La Cresta Drive in Dana Point, which will also be held from 5:30 to 7:30 p.m.For more information about the South Orange County Major Investment Study, call 888-647-4762 or to complete an online survey, visit www.octa.net/socmis.

Recipe: BBQ Meatball appetizer

Cindy Kalionzes (no current broker affiliation) — Mon, 25 Feb 2008 09:24:00 -0800

Okay, I don't know if this is so much a recipe, as it is assembly instructions, but when I had occasion to need an appetizer that would taste great and feed many, I discovered I didn't know if there were extra stages to making this. I'm here to say: there aren't. This is about as simple as they come.BBQ MeatballsTake a large bag of frozen pre-cooked meatballs and place them in a heated Crock Pot. Pour BBQ Sauce over them until they are pretty much covered. Let sit in hot crock pot (on high) until heated through. That's literally it.Tips:Plan ahead - if you can thaw or pre-heat the meatballs first, they will be ready sooner. I placed mine in the fridge overnight. They came up to temperature around the 1 1/2 to 2-hour mark. Obviously one of the beauties to an appetizer that uses a slow cooker is that you can get the prep out of the way early, and it can handle (and even needs) sitting for long periods of time without damaging the final product. This leaves you free to prepare more demanding items.This takes a lot of barbecue sauce. I used a large bag of meatballs from Smart & Final (around 100 ct.), and it took more than a bottle of sauce to cover. Plan ahead and buy 2 bottles of BBQ sauce for this one. To make it extra interesting, consider mixing brands/types of sauces to create a more complex flavor. I mixed an inexpensive dark sauce with the remaining portion of a bottle of Chris & Pitts sauce, which is more of a red barbecue sauce, to rave reviews. If you are making a smaller amount, still assume you will need at least a bottle.Serve with a slotted spoon and toothpicks. Plan for splatter by placing the Crock Pot in an easily accessible area, on an easy-to-clean surface.If this is a potluck item, remember that many people bring starches, veggies and sweets. As possibly one of the few meat items, it will be popular. Shopping it right, this is not expensive to make, so go big on the portion planning.

Doing your homework

Cindy Kalionzes (no current broker affiliation) — Mon, 25 Feb 2008 08:51:28 -0800

It isn't often I see a really good article on regular news sites, but I did today. This article (linked below) talks about some of the research that home buyers really need to do for themselves about a particular neighborhood, and also provides some resources for doing that research.We often suggest to our clients that they look into the sex offender registry sites to see for themselves if there are sex offenders nearby. The reason we do this is the websites have the most up-to-date information available, and it's the kind of info that is really important for people to look into for themselves. The article does provide info on where to look for this info, by the way.School information is often convoluted even when attainable; while you can receive a particular school's scores, it is often difficult to determine how those scores translate into actual performance. However, the article does provide resources on where to find school info as well. My advice is to seek out parents of students at the school in question and talk to them about their level of satisfaction with the school. Between that and score information, you will have some basis to compare areas to each other.All in all, it is a good resource for understanding the how and why of doing your homework on a neighborhood you are thinking of buying into. http://realestate.msn.com/Buying/Article_mw.aspx?cp-documentid=4220787&GT1=10932

USPS provides yet another great farming opportunity

Cindy Kalionzes (no current broker affiliation) — Mon, 11 Feb 2008 08:33:14 -0800

The USPS now raises the prices on stamps annually. Here's this year's announcement.While the existence of the "Forever" stamp may make giving out 1-cent stamps seem less necessary, it is still a very inexpensive, high-impact way to reach out and touch your farm. Sheets of 20 1-cent stamps can be easily divided into two slips of 10 (I know, I have done this), making each contact cost a mere $0.10. Whether your prospects invested in the forever stamp or not, they will appreciate the gesture. And any excuse to talk to people is a good one, especially when you come bearing gifts. If nothing else, they'll appreciate being notified of the change in time to grab an extra book of $0.41 Forever stamps before the price goes up.Slips of 1-cent stamps are also very easy to place inside those personal notes I'm sure you're writing your clients (you ARE writing personal notes, aren't you?). And they sure make figuring out what to say in that note easier. "Price of stamps is going up to $0.42. I thought these might come in handy. Please think of me when you're ready to place your home on the market." Voila!

An interesting question about abandoned homes

Cindy Kalionzes (no current broker affiliation) — Mon, 28 Jan 2008 08:35:20 -0800

Today I was surfing the web and came across an article about homes which have been abandoned by both homeowner and bank: http://realestate.msn.com/buying/Article_busweek.aspx?cp-documentid=6015750&GT1=10833The article poses an interesting question.Sometimes in foreclosure a homeowner will simply walk away from the home they are unable to save. The bank, determining the home is not valuable enough to bother pursuing, might choose not to go to the trouble and expense of pursuing the foreclosure or maintaining the house, allowing it to revert to the state according to the state's process for dealing with unpaid property taxes. That process can take from 3-5 years, during which time, who is responsible for maintaining the property? Who keeps the lawn from dying, or meth dealers from turning the kitchen into a lab, or the pool from becoming a pond of toxic sludge?If the home had been foreclosed upon and the bank taken title, I'd say ultimately the bank is responsible. But in this case, the bank never held title. At the same time, if a homeowner has abandoned their property to foreclosure, they are under the impression that the bank takes the house, so how can you really hold them responsible? In my opinion, there might need to be a system by which the banks at least assign the defaulted loan over to the state so that the state can begin pursuing foreclosure without waiting for the lengthly "unpaid taxes" process to see itself through. But admittedly I can't quite be sure how you could handle that without getting a quitclaim deed from the defaulting homeowner and the bank.Here in California, instead of the traditional "mortgage" our banks actually hold a trust deed, so the chain of responsibility is clearer.I'm actually very curious to hear the opinions of anyone reading this blog entry - in your opinion, how should the maintenance of abandoned homes be handled? Who's really responsible for the home?

Raindrops keep fallin' on my head

Cindy Kalionzes (no current broker affiliation) — Mon, 28 Jan 2008 07:03:41 -0800

Wow, some weather we're having!You know, this is a good time to talk about rain and buying a home. Many of the finest homes in Southern California are built into, on top of, or just below hillsides. When we get large amounts of water being absorbed into ground that isn't accustomed to it, sometimes the ground reacts.If you're looking at a home that could be affected by mudslides, you will want to do some extra research on the property. Check not only the ground the home actually stands on, but also the immediate area where a mudslide may affect the home - a hill above the home, below, or anywhere where a mudslide might bring the home closer to the edge of a hill.When in doubt, consider getting an inspection done by someone who specializes in ground stability.

RATE CUT!!!

Cindy Kalionzes (no current broker affiliation) — Tue, 22 Jan 2008 04:42:29 -0800

The Fed just did something they haven't done since 2001 - changed the Federal funds rate between meetings! Not only that, but they dropped it from 4.25% to 3.5%.Just to put into perspective how serious this is, I should point out that the next meeting of the Fed is a mere week away. But their concerns about the direction of the global economy were such that they held an emergency video conference last night and voted 8-1 to drop the rate 3/4 of a percent effective immediately. If you've been reading for a while, you know what a departure from the norm this behavior is. The Fed has been very conservative up until now, but lately they're talking very seriously about aggressive rate cuts. Yes, they're hinting that more cuts may be on their way.While this raises concerns for the overall economy, and makes me wonder what the Fed sees in our future, I cannot help but be happy about the rate cut as this is a huge boon to home buyers. Now, it may take a couple weeks for the rate changes to filter down to home loan rates, but let's see what a cut like that could mean:Say you're looking at a home and need a $400,000 loan to get it. If the interest rate on a fully-amortized 30-year loan was 6%, then your monthly payment (P&I) would be $2400. Now, let's say that the loan rates were to follow the Federal Funds rate, and come down 3/4%. That same $400K loan, at 5.25% interest, would have a fully-amortized payment of $2208. Think that makes a home a bit more affordable? Just perhaps? It's like getting an 8% reduction in the price!

Picking up the pace

Cindy Kalionzes (no current broker affiliation) — Tue, 15 Jan 2008 05:41:17 -0800

Ahh...The verdant hillsides, 70 degree temperatures, buyers calling me up and wanting to see homes... it must be spring!However, even I am surprised with the suddenness of the uptick in activity. In the last 5 days I have been contacted by 3 of my buyers, showed several homes to one, nearly wrote an offer only to have the desired property go into escrow, scheduled showings for another client for next weekend, and had a third client contact me with serious questions about a property they want to see.Now sellers, don't go getting all excited. Yes, it's spring and there's more activity, but be advised that there will also be an increase in inventory (your competition!) as well. This is still a very good time to stay put and only sell your home if you absolutely have to. Only the best priced homes, in the best condition and location, are going to attract the attention of buyers. However, if you keep your home in top showing form at all times, AND you are aggressive with your pricing, you may just see multiple offer situations.Buyers.... what does this mean for you? Simply, it's time to get off the fence! We're only two weeks into the year and already I've had a buyer lose out on a home he really liked because he didn't get in ahead of another buyer. Yes, there are a lot of homes to choose from, but there are more buyers actively looking now, too. Remember, if it looks like a good deal to you, it looks like a good deal to everyone else as well! Sleepytime is over. As we continue on into the spring, buyer activity is going to continue to increase, so NOW is the time to get in there and find your home, before someone else does! It also means you need to be prepared to act once you find that "right" home for you. So get on the phone with your lender TODAY, and get yourself pre-approved (not merely pre-qualified, which means bupkis under current lending conditions). That way you know exactly how much home you can afford and have a lender standing by ready to issue you a pre-approval letter to accompany any offer you may write. If you don't talk to a lender before you find the home of your dreams, that delay may cost you the chance at that home.Don't wait to go see those homes that interest you, every day you wait is a day that someone else could walk in and write an offer.

Fed promises interest rate cut

Cindy Kalionzes (no current broker affiliation) — Thu, 10 Jan 2008 05:13:48 -0800

It's very rare for the Fed to use such strong language like this prior to a meeting. Based on what Bernanke has to say, I'm going to anticipate a 1/2% rate cut at the next meeting in just less than 3 weeks. Here's the article:http://www.msnbc.msn.com/id/22592939/In it, he says, "We stand ready to take substantive additional action as needed to support growth and to provide adequate insurance against downside risks." The article discusses the possibility of a half percent cut, but also the chance that they'll play it conservative with a quarter point cut. Given the measured language that they've used in the past though, I doubt they'd play it conservative at this point. The reason is, if they raise expectations by promising "substantive additional action" and only deliver a modest quarter-point cut, they run a serious risk of disappointing the market. Whenever someone, or a company, delivers less-than-expected results, there is a negative effect on the market. I doubt the Fed would purposely raise expectations only to fail to deliver on them. The Fed knows that every word they issue is heavily analyzed by market experts in order to glean every last possible drop of information from it, and oftentimes, they have to play their hand very close in order not to undermine whatever goal they're pursuing. This is why I don't believe this statement is a fluke or slip up, I think they really intend to deliver.

Happy New Year! Now let's get down to business...

Cindy Kalionzes (no current broker affiliation) — Wed, 02 Jan 2008 03:43:21 -0800

Okay folks, the holidays are now officially behind us. As the world "gets back to work", another thing people get back to is their search for a home. This activity tends to increase as we approach the spring months. First, we expect to see some home sellers re-entering the market in hopes of an increase in activity. While there will be an increase in the number of buyers over the previous months, I believe the number of new and returning sellers on the market will probably exceed the number of new buyers. For the buyers out there, this early part of the spring market is going to be a prime buying time - we have an increasing number of homes on the market, giving you the greatest selection, and if you start now before things really get into full swing on the buying end, you'll have the minimum amount of competition.When is the best time to buy? Well, it was probably over the holidays, when desperate sellers knew it would be a long time before buyer activity picked up. However, now probably ranks as a close second to that - spring is still a little ways away, and uncertainty about the market reigns supreme. I think the way to go here is to identify a property in the next couple weeks, and open escrow, but have that escrow close some time after the end of January (because the Fed meets again at the end of this month). That will leave you positioned to take advantage of any interest rate drops, should there be any, while at the same time having secured a property for your desired price with the least competition from other buyers.

What leading indicators have to say about the market - good news for the west!

Cindy Kalionzes (no current broker affiliation) — Fri, 28 Dec 2007 05:18:20 -0800

This article on MSNBC.com talks about how the sales of new homes dropped again in November. Even when we deal in resale homes, it is important to be aware of what the new homes are doing, as they're often a leading indicator for what's ahead in the resale market.Now, I'm not terribly surprised to hear that new home sales dropped last month, because of what happened in the month preceding it, with the mortgage crunch at its worst. October was a terrible month for resales especially, as banks tightened their fists and were very reluctant to release funds, even for sales that had already been in progress. I suppose it stands to reason that a combined effect of the mortgage crunch and the bad news resulting from it would lead to slower new home sales the following month.But what's really interesting to me, being in Southern California, is this little quote that came later in the article (bolding mine): "By region, sales fell in all parts of the country, except for the West, where they rose.New-home sales dropped by 19.3 percent in the Northeast. They plunged by 27.6 percent in the Midwest and they fell by 6.4 percent in the South. However, sales increased by 4 percent in the West."Frankly, the uptick in activity has been noticeable in the resale market too. Bearing in mind that activity picks up before sales do (hey, people have to find homes and open escrows before they can close them, right?), I think we are seeing an improving trend in the market.Don't get all excited yet, kids. Inventory is down, more because frustrated sellers removed their homes from the market for the holidays than due to any uptick in activity. Prices aren't going to suddenly spring back on us. In fact, expect that we will see a great many homes placed back on the market in early spring - well before the usual spring activity gets into whatever modified version of full swing that we are going to see this year. However, for those of us on the West Coast, it is encouraging to see that more buyers are taking advantage of the great prices and interest rates available to them in the current market.Comparisons to the market of the early 90's are difficult because the circumstances are different. I think the numbers back this up. In the 90's, California was slow to recover in part because we'd been delivered the 1-2 punch of not only a bad real estate market, but the closures of many military facilities that had a slowing effect on our economy. This time around we are not so unfairly burdened as before. So instead, we see the benefit of regional differences: our wonderful weather, the landscape, the fact that people just plain want to live in our beautiful state. Southern California is a very desirable place to live, and, barring any unusual circumstances like we had in the 90's, we are quicker to recover than many other parts of the country.What does all this mean to a buyer? Well, if you were waiting for someone to ring a bell when we hit market bottom, I've got news for you: you won't know it was the bottom until you've missed it. But when it comes to looking for the ideal time to buy, this is probably it. There is some pent-up demand from buyers who held off buying in fall, either due to the mortgage crunch or due to waiting to see what happens with pricing. A lot of these people think they're going to be buying in spring. Given the fence-sitting nature of these folks, they are more likely to take action in later spring, after market activity has picked up, than they are to blaze a trail in early spring when there is less competition. Many sellers who removed themselves from the market for the holidays are going to be coming back on the market in anticipation of the spring increase in buyer activity. They will start coming back on the market after the New Year.This means that you, the buyer, have a chance to get in early, with the most selection and the least competition. The Fed meets again at the end of January, and most people expect another drop in the Federal Funds rate. That drop may or may not have a tangible effect on mortgage rates. After that meeting, the next one isn't until March, when more buyers will have entered the market. I think the ideal situation is to identify a home in January, get an offer accepted by the end of the month (before the Fed declares a rate drop and sellers start expecting more buyer activity), and close escrow some time in mid- to late February. This means you will have gotten into the market before other buyers but after many sellers came back on, allowing you maximum selection with minimum competition - which means you can bargain harder to get a good price. But you'll close late enough that if there should be any lowering of mortgage rates after the Fed meets, you will be positioned to take advantage of that before you close your loan.

Do you believe in magic?

Cindy Kalionzes (no current broker affiliation) — Thu, 20 Dec 2007 07:48:43 -0800

I'll get to the point of this post in a moment, but first, a story:So apparently I'm "magic". And not just because I help make buyers' home ownership dreams come true. No, this is a deeper kind of magic. The kind of magic that makes chocolate materialize, just by thinking about it. That's some serious magic right there!I'm sitting in the office the other day, and silently thinking to myself how very much I would like to have a piece of chocolate just then. Another agent comes by and shows me a gift left for them by a title rep - a shiny box (about the size of a tennis bracelet box, maybe a bit taller) containing 4 decadent chocolate truffles - one of which, they offered to me!Okay, one time is a fluke, but two?Today, I'm sitting here thinking how nice that truffle was the other day and how very much I wished I had some chocolate right now. In walks a vendor with a gift for an agent in an office that used to be across the atrium from us. He's (obviously) trying to find that office. So I look it up, tell them where the office moved to, and because I'm just cool like that, I print him a Yahoo map. On his way out, he says I've been so nice, he wants to give me one of his (pop-by gifts): chocolate-covered graham crackers.I wish for chocolate, chocolate gets offered to me. I'm magic!Okay, so that was the "story", here's the idea... those chocolate covered graham crackers were delicious! And how easy would those be to make, seriously? This is a great "homemade goodie" to share for the holidays. Simply get some melting chocolate from your local market or baking supply store (some craft stores also sell it). Follow the directions to carefully melt the chocolate (use a double boiler or your microwave, and be sure not to get any water in the chocolate, stir frequently to prevent burning). Then take graham cracker halves, dip them completely in chocolate, and place on a wax paper-covered cookie sheet to cool.And what the heck, since you have the chocolate melted already, go ahead and dip some strawberries for yourself!Now, if you'll excuse me, I'm waiting for the latte I was wishing for earlier to arrive... ;)

Checking up on interest rates

Cindy Kalionzes (no current broker affiliation) — Fri, 14 Dec 2007 03:51:44 -0800

It seems it's been a while since I did an interest rate update. Let's see how they're doing, shall we?Today's National Averages Mortgages APR 30-yr. fixed 6.00% 15-yr. fixed 5.64% 1-yr. adj. 6.12%Last time I mentioned interest rates was on November 19th:Mortgages APR 30-yr. fixed 6.04% 15-yr. fixed 5.63% 1-yr. adj. 5.77%The week before that, these were the numbers: Mortgages APR 30-yr. fixed 6.21% 15-yr. fixed 5.90% 1-yr. adj. 6.70%November 5th, they looked like this:30-yr. fixed 6.22% 15-yr. fixed 5.93% 1-yr. adj. 6.80% (Note that the Fed had dropped the Fed Funds rate 1/4% on Oct 31st, so about a week before those numbers)Going back in time to October 10th:30-yr. fixed 6.39% 15-yr. fixed 6.08% 1-yr. adj. 6.85%September 19th (the day the Fed announced the initial half-percent drop in the Fed Funds rate):30-yr. fixed 6.20% 15-yr. fixed 5.97% 1-yr. adj. 7.36%August 28th:30-yr. fixed 6.36% 15-yr. fixed 6.12% 1-yr. adj. 7.25%