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STABILITY IN THE HOUSING MARKET IN SOUTHERN CALIFORNIA?
Written by Joan Patterson | July 21, 2009 8:10 AM Market ConditionsNo comments | 111 viewsI am not sure about you, but I know that every day I have been out showing property, writing offers, and to find out that there are multiple offers-even on a home that was just listed that day! I have been saying repeatedly that the inventory is low, while the buyers are many! Almost too many buyers for the market right now.
Here are a few reasons for the inventory being down:
1. Most home sellers do not want to sell unless they have to and also unless they have the equity!
2. Banks are taking longer to foreclose and are not releasing the foreclosed homes for sale right now.
The decrease in homes is not new, but it has been going on for the past year. With this in mind, this means that it is harder to actually get a home with the first offer you make. Don't fall in love with a home because of the multiple offers that are going on right now. You may not get it because someone else may have a better offer. Always make your offer your best offer if you love the home. That way, you will know you did your best and if it does not work out, you won't wonder if you had offered more, would you have been the one that actually got the home?
I have been doing a lot of research and have been asked by numerous clients if I think the market is stabilizing and YES, I think it is stabilizing in Southern California. I cannot say this for other places as I do not know the markets there. When there is a drop in the number of homes that are in the MLS and numerous offers being made on these homes, it does show signs of stabilization. Median home prices have started to increase in the Los Angeles area which also points toward the market stabilizing. Of course, none of us have a crystal ball, but this seems to be where the market is going.
Good luck out there!
Joan Patterson, B.A., A.S.P., G.R.I., Realtor, License #0141647
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, CA 91730
951-204-1864
www.calljoan4homes.com
www.socalreopartners.com
calljoan4homes@aol.com -
New Options for Loan Modifications and Short Sales!
Written by Joan Patterson | July 2, 2009 8:10 AM Market ConditionsNo comments | 131 viewsI was reading an article yesterday and wanted to share some of the key factors with you. I thought this was very interesting!
Before, loan modifications would not include the second mortgages, however, now they can include them! This is great news! Many folks were turned down before when they applied to do loan modifications because of the second trust deed, but now, they should reapply and try it again. This includes lines of credit and equity lines as well against your home.
As far as the second mortgage goes, the government says they can give the banks a payment that basically will make the second go away. I am a bit concerned about that one with our economy the way that it is right now and with California giving us all IOU'S on everything!
This is, of course, if your lender will participate in this program. You will have to check with your lender. There are many banks that do some of them are, Wells Fargo, Bank of America, Citibank, Countrywide, Chase and others.
You must be living in your home (it cannot have been used as a rental), you must also have taken the loan out before January 1, 2009; and not owe more than $729,750 on it, must also prove you cannot afford your mortgage because of loss of job, change of income (many folks have been reduced to working 4 days a week) and there are several other factors that must qualify as well.
As far as short sales are concerned, lenders can receive a $1,000 payment from our U.S. Treasury, and basically then the lender would treat it as full repayment instead of a short sale. The Treasury will also pay the second lenders up to $1,000 so they don't stop the deal from happening like they so often do. Then, the short sale does not go through which is very frustrating.
There are many other new options out there, check with your bank and see if you can now do a loan modification which would be best overall. Also, check with your tax professional as to the new laws and how this can affect you.
Make it a great day!
Joan Patterson, B.A., A.S.P., G.R.I., Realtor, License # 0141647
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, Ca 91730
951-204-1864
www.calljoan4homes.com
calljoan4homes@aol.com -
Short Sales - Are You Really Getting A Good Deal?
Written by Joan Patterson | June 20, 2009 7:25 AM Home Buying17 comments | 1,074 viewsWell, I get asked all the time about short sales. Many people do not understand what they are. They are actually being sold "short" of what is owed, so the bank is taking a loss. Many times, it is a substantial loss. The term short sale does not mean escrow will be short like so many people believe.
My question to you is this, when making an offer on a short sale, are you really getting a good deal? Many people think the answer is always yes, but in fact, it can be that you are really paying market value and in some cases over paying. The reason I say you could be over paying is this: short sales take a very long time (in most cases they are 3-8 months or even longer). So, you make an offer say right now on a short sale, and the values keep going down and down with each passing month, meanwhile, your offer is higher than what is truly should be for! So, you see where I am going with this? It does not always happen that way, but you really should know the market and make sure your agent runs comps for you all the time. Make sure your agent includes a short sale addendum which states on there how long you are willing to wait for the bank to approve your home purchase as well. Don't leave it open ended in case you get tired of waiting.
Don't be surprised as well if the bank comes back and counters your offer and this can happen after you have waited 6 months for the home. The banks do not have to accept your offer at all if they don't want to. And, after all your time waiting, the homeowner can do a loan modification which means you will not get the house and they will be able to keep their house. Good for them, bad for you.
Make sure you are working with an experienced short sale agent. Also, please note that since the bank will be taking a loss, many times they won't pay for a home protection plan, termite work etc. The home will be sold "as is". Expect delays...let me repeat, expect delays...short sales are not easy and many people get very tired of waiting on them and move on to a standard sale or a bank REO.
So, at the end of the day when working with a short sale, please make sure you keep an eye on the market, have your agent run comps to make sure you are not over paying when the time has come if the bank does approve your offer. If you have the time to wait, then go ahead, but know the facts before submitting an offer on a short sale.
Good luck!
Joan Patterson, B.A., A.S.P., G.R.I., Realtor
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, CA 91730
951-204-1864
www.calljoan4homes.com -
The New Foreclosure Moratorium
Written by Joan Patterson | June 19, 2009 10:30 AM Market ConditionsNo comments | 303 viewsThere has been a lot of confusion about this new moratorium. Everyone thinks that a lender has to help out the homeowner by doing a modification which is not exactly true. While, I am sure the lenders would like to do a modification, it does not mean that the homeowner will be able to do this for various reasons ie such as losing their job etc.
This new law extends the foreclosure process by 90 days-unless a lender gets an exemption. They can get that from the state if they already have their own loan modification in place that actually is helping people be able to stay in their homes. Also, the loan had to have been obtained from 1-1-03 through 1-1-08 and it had to be the first deed of trust that was defaulted on, not the second.
This law is trying to help unnecessary foreclosures in which the people's loans can be modified.
If a notice of default was filed before the new law, then it does not apply to that person. And, it does not apply if the bank has turned over the loan to a loan servicing company.
As you can see, there are still a lot of loop holes in this new law. However, it can help some homeowners. And, I think that is a good thing!
Kind regards,
Joan Patterson, B.A., A.S.P., G.R.I., Realtor
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, CA 91730
951-204-1864
www.calljoan4homes.com -
Don't Get Discouraged Buyers!
Written by Joan Patterson | June 18, 2009 7:53 AM Home BuyingNo comments | 405 viewsCalling all buyers, please don't give up out there. Like I have mentioned before, I get buyers all the time wanting to find another agent because they feel that their current agent is not doing a good enough job for them. I know how frustrating it is in Southern California. I feel sometimes that everyone out there is in a battle to get a home. Agents get frustrated because we can show a buyer homes only to find out that 5 offers came in while we were out showing it and now our buyer has fallen in love with the home. I hate it when that happens. I think with the tax credits and the interest rates on top of the great prices of homes out there many people who thought they could not buy a home now can and they want to get in before the December 1st deadline.
I don't blame them....
I am hoping that Obama will extend the deadline into next year so that more people can afford homes. I think with the deadline, it is making many people upset because they feel they really need to buy something NOW. And, they are getting frustrated when homes are already sold because the agents leave them in the MLS as active when they are not active and they should be pending or back up or hold....this is one of my biggest pet peeves! I can call a listing office to check availability and they will say, yes it is available, and then I have to press them to see if they do have offers...99.9% of the time they do...so, if the offers are more than the list price (which many are) and my client is only qualified for the list price, they are out right then and should not even pursue that home any longer! I think they need to be honest and let us know up front that there are offers already. Not that I have to ask!
Buyers, make sure you get someone who is aggressive out there to represent you. Make sure you have copies of your FICO scores, a pre-approval (not a pre-qual), make sure you have documentation of your down payment (ie copies of your bank statements) all available to give to your agent. I would mark out your account numbers on your bank statement though.
Make sure your offer nets the highest amount to the bank...don't ask for closing costs if you don't need them. It could cost you the house if someone else does not ask for them (when there is another offer on the table and most likely there will be in this market). But, whatever you do, don't get discouraged. Remember, all buyers are in your shoes....and only one buyer can get the house. So, keep looking, keep trying and you will get a home. I would also encourage you to leave your offer as a back up offer because many times the first buyer cannot get the house. You would be surprised! You will be able to get into a home, but you need to get out there right when a listing appears on the market. Make sure you are working with an agent who checks the MLS daily for you with the new listings that pop up.
Good luck!
Joan Patterson, B.A., A.S.P., G.R.I., Realtor
Keller Williams Realty
8250 White Oak Avenue,Ste 102
Rancho Cucamonga, Ca 91730
951-204-1864
www.calljoan4homes.com -
How to Make Your Offer on a Home STAND OUT!
Written by Joan Patterson | June 17, 2009 8:05 AM Home Buying26 comments | 3,724 viewsI get calls all the time from buyers who say they are DONE with their current agent. They tell me their current agent is not doing a good job because they have made multiple offers on homes and they have not gotten one house. I get very saddened by this only because I know from my own experience that it is tough out there right now for agents. There are so many numerous factors that are hindering the realtors and clients do not understand it.
First, people want to see a particular home. So the agent will call only to find out that the home really is not active and that it has multiple offers on it. The status really and truly should be changed to pending or back up or hold depending on the situation. I cannot tell you how many times I call only to find out a home is not available. Many times, I can leave messages for other agents and they never get back to me because they are "too busy" aren't we all. The board of realtors will be fining agents for not putting homes that truly are not active in their proper category so the other agents do not waste their time. I called on over 40 homes in Fontana the other day and one 1 was truly available.
The offer you make needs to stand out. What do I mean by stand out? Well, first you need to make sure you are working with a reputable bank...not ABC Mortgage in timbucktwo...you need to work with someone that people respect, such as a big solid bank like say for example Wells Fargo would be good. Anyone knows they are very strict with their lending. So, get a pre-approval, not a pre-qualfication letter. Also, when trying to buy a REO listing (Bank Owned) they do have you cross qualify with their lender which is normal. Many people do not understand this and get upset over it. Just do it, otherwise, your offer will not even be looked at by the bank.
Don't ask for a lot of concessions. By this I mean, don't ask for closing costs if you don't need them. That will net less to the bank and someone may outbid you on a property. If at all possible make your best offer. I always run comparables for my clients so they are not over paying. One thing many people think is if they are the highest and best offer out there they certainly will get the house. Not necessarily if it is over the appraised value the bank won't allow the sale to go to you. They know the market and know what the home should sell for, they want to get the closest to that they can. So, make sure you know what the house is worth and don't overbid.
The type of financing really matters to the banks these days for an REO listing or (Bank Owned). Cash is best, but most people don't have all cash. Conventional financing is best over FHA/VA loans. However, it is what it is and just keep trying. The inventory has been down therefore, homes are getting multiple offers. You want to get over to see a house as soon as it is listed and make an offer right away, don't wait or it will be gone.
Don't blame your agent if he/she writes up your offer how YOU wanted it. Remember, your agent represents you and you need to make sure you are happy with it before it is submitted. It is not totally an agents fault, we must take responsibility for our own actions and not be so tough on the agents. It is hard to get a house accepted with you are competing with so many other offers. You need to figure out what you can live with and not ask for on a home to make your offer stand out. And, you need to ask yourself how much you are ready to pay. See the comparables that your agent should provide you, and if they don't ask to see them.
Keep your offer as simple as possible and make sure it nets the bank or seller the highest amount possible and that should help you have a stronger offer.
Good luck out there!
Kind regards,
Joan Patterson, B.A., A.S.P., G.R.I., Realtor
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, CA 91730
951-204-1864
www.calljoan4homes.com -
Buying an REO or Bank Owned Property in Today's Market
Written by Joan Patterson | June 9, 2009 6:38 PM Home BuyingNo comments | 289 viewsI cannot stress enough how important it is to make sure you have a pre-qualification letter in hand (a pre-approval is better!) when trying to purchase any home. I have had many of my buyers balk at doing this and they just want to go out looking at homes. My first protocol is to get one of these up front. I cannot tell you how many people really do not know their credit scores, nor do they know how much they really can afford. That is why it is imperative to talk to a lender before even a realtor!
So, after you have that done, then it is time to find the best realtor for you. Now, the market has been very tough out there. I have had many buyers call me after working with another agent only to tell me that they have made 10 offers and have not gotten anything. They are blaming their agent and getting frustrated. There could be numerous factors as to why their offers are not getting accepted and it may not have anything to do with their realtor.
The fact is, that inventory is down right now, so you have multiple offers on homes. So, there is only one person that gets the home, and I have run into the fact that many offers are coming in as well. One deal had over 30 offers on it! So, how do you compete with that? Well, the first thing I do for my clients is to do a market analysis to see what the house should be priced at. To be honest, people can get caught in a frenzy and just keep upping the anty and their offer is too high because the home will not appraise for that amount. Therefore, the bank will not even take their offer if you can believe it! It is not always the highest and best offer that wins. There are other factors....
The type of financing plays a part as well. Typically, an all cash offer will take precedence over financing if the cash offer is high enough. There are many things that can go wrong when you try to get a loan and an all cash offer can close quicker as well with no appraisal contingencies from the lender. Conventional loans come next, and then it is FHA and VA. At least, this has been my experience.
When writing an offer for a client, I always check out the comps to make sure the value and then we go from there. Usually the bank will come back to everyone and ask for their highest and best offer. Since most banks underprice their homes to generate a lot of interest and offers, I tell my clients our strategy and I won't reveal it here, because then you will know my great strategy, but it does not take us many offers to get something accepted. You need to work with an agent that really knows how to deal with the REO lenders so your offer gets accepted.
I have experience in dealing with bank owned homes and can get the job done, if my client listens to me!
Kind regards,
Joan Patterson, B.A, A.S.P., G.R.I., Realtor
Keller Williams Realty
8250 White Oak Avenue,Ste 102
Rancho Cucamonga, CA 91730
951-204-1864
www.calljoan4homes.com
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