Once Every Four Years....

February 29, 2008

Today is "Leap Day". It is the extra day that comes once every four years. It seems to me that it would be nice if it were declared a special holiday and we all did something out of the ordinary.

Perhaps do that random act of kindness. Perhaps call someone you haven't talked to in a while. Of course, for those of us in the real estate business, we think this is the day you should decide to buy a house. That would allow you to call someone you haven't talked to in a while (your real estate agent) and also do a random act of kindness for a stranger (a seller).

Once every four years have a Happy Leap Day.

A Major Challenge in Environmental Protection

February 28, 2008

As the ownership and use of electronic gear has proliferated, the disposal of outdated and broken equipment has become a major challenge. Because such gear is considered hazardous waste, it cannot be thrown out with ordinary trash. There is no federal regulation governing electronics disposal, but some states have regulations. California is one of the states that does not permit electronics to be placed in landfills.

So...what is a person to do?

If your computer is still functional, give it to a school or charity. Same is true for cell phones and toner cartridges. Perhaps you can sell it on EBay or to a computer reseller.

Recycle it. Some municipalities do provide recycling services as do some manufacturing companies. Apple offers recycling programs for computers, printers and IPods. You can hire a third party company to dispose of your equipment. The advantage of using a specialized vendor is that they assume liability for the disposal and a reputable vendor will also wipe your hard drive clean. (Remember to save your programs and wipe your disc clean with a special software program. This extra step can be critical to prevent identity theft.)

Here are a few web sites you might check out if you are thinking of disposing of your electronic gear.

http://www.pcdisposal.com/

www.epa.gove/ecycling

http://www.quickwiper.com/

http://www.webmasterfree.com/

(I obtained this information from an article that was published in the March 2008 Realtor Magazine.)

Recycle it

A First Step Toward Being "Green"

February 27, 2008

If you are a homeowner and you want to reduce your energy usage, a first step could be to contact the utility company that provides the fuel for your primary heating source. Most of these utility companies will provide an energy audit service. An auditor will come to your home and conduct a thorough inspection of a number of different areas and make a determination of the amount of heat your house is losing. Typically this inspection service is without cost to the homeowner.

A first concern of the inspector will be your insulation. What type do your have, how deep is it, how much of the attic floor does it cover and the condition of the insulation. Wall insulation coverage will also be determined as much as is possible without tearing into the wall. Removal of an electric outlet plate sometimes will allow the inspector to note the insulation in the wall.

A second concern is "air infiltration" - how much air leaks into the house and how much air (heat) leaks out of the house.

Thirdly, the auditor will check your heating and cooling systems. They will check the type, the age, the efficiency and the general condition. They will also check the ducting as ducts, over time, can sag, pull apart at their joints and seals and are often found to be inadequate for the square footage of the home.

An auditor will also check your thermostat for accuracy and for the type of settings that are available to you.

The auditor's inspection will also check lighting types and water heating equipment.

All the data will be entered into a computer program to isolate where the biggest potential energy savings are. You will receive a list of recommendations and perhaps what the potential payback of the more costly recommendations might be.

"Green" is Becoming the New Buzz Word

February 26, 2008

Have you noticed lately that "Green" is the new buzz word. Governments at all levels are talking about enacting "green" standards. Developers are suggesting that the homes they build meet "green" guidelines. And soon the party folks will be "wearing the green" for the annual St. Patrick's Day celebrations.

So what makes a city or a home or a consumer product "green"?

"Green" has to do with reducing carbon dioxide emissions and electric energy usage. As a homeowner, you can conduct an energy audit to check how much electricity you are using. Newer models of appliances and electronic devices will generally use less electricity than older models. That is why your electric utility will offer rebates on a purchase of a new refrigerator or freezer. However, as homeowners switch to the new LCD or Plasma TV sets, the electricity consumption will increase, not decrease.

If you are planning a purchase of a product that will use electricity, here are some organizations that are attempting to rate the new products.

Energy Star - A voluntary program set up by the U.S. Department of Energy in 1992 to recognize energy-efficient products.

Electronic Product Environmental Assessment Tool - A guide by the Green Electronics Council to assess the environmental attributes of computers and monitors. EPEAT criteria weigh design, manufacturing, packaging, use, disassembly, recycling and disposal.

80 Plus - Certified products have power supplies that are more efficient than standard power supplies.

Of course if you really want to go green, you can consider changing your home power supply from electricity to solar. Expensive, but perhaps over time the most environmentally friendly choice.

If You Must Sell in a Buyers' Market

February 25, 2008
Now that we all know that the real estate market has cycled from a sellers' market to a buyers' market, it is important for the sellers who must sell to recognize that real estate values are not the same as they were a few years ago.
Having said that, it is still possible for sellers to sell quickly and sometimes with multiple offers.
I recently read a fun article entitled "Play the Cards You're Dealt". The author suggested that when you sit down at a poker table, you become a winner by being realistic about the odds of winning a hand with the cards you are dealt. Knowing when to raise and when to fold contributes to the chances of being a successful poker player.
Similarly, when you put your house on the market at the present time, there are strategies that will increase the chances of a successful sale.
1. Know what comparable properties are selling for NOW!
2. Ask your agent to take you out to see your competition.
3. Make your house a turnkey...not a turkey.
4. And above all be realistic about how your house compares with others.
This is not a time to "try a price". This is a market that says "Here's your value, list lower that your value". Smart sellers are playing the market this way and they are winning.

Watch Your Mail

February 22, 2008

I know that I receive a lot of "junk" mail. Lenders still offering refinancing, equity loans and money saving rates send letters almost daily. I routinely throw these letters away without even opening them. However, if you happen to be a recipient of a letter from the Department of Housing and Urban Development, it could contain useful and important information; especially if you are a homeowner with an adjustable-rate mortgage that has already adjusted higher or that soon will.

HUD has announced a mailing of 850,000 letters nationwide with approximately 55,000 being sent to Califronia homeowners. The letter encourages residential homeowners to refinance with government insured FHA loans. Presently the maximum FHA loan amount is $362,790 which is an amount that could fit borrowers in the Riverside/San Bernardino market area.

This is one more step that the government is advancing to aid homeowners to remain in their homes. If you are delinquent in your payments and that delinquency is related to a rate reset or a recasting of yur mortgage, you could be eligible for this program.

I suspect that, like many of the government attempts to reduce the financial liabilities of homeowners, this could only assist a small portion of the huge number of folks who overborrowed. However, it is important to check out these programs to determine if the program will provide assistance to you.

Questions and More Questionson Debt Relief

February 21, 2008

The past several weeks, I am receiving questions from sellers and fron agents regarding the tax implications of short sales and foreclosures. In December, the U.S. Congress passed the Mortgage Forgiveness Debt Relief Act of 2007. Like most congressional acts, this one has many details that are crucial to the determination of the tax consequences of both short sales and foreclosures. My best advice to any seller is to consult with a tax accountant or a tax attorney if you are in a short sale or foreclosure situation.

Prior to the passage of the Debt Relief Act, any forgiveness of debt was subject to taxation as ordinary income. The Debt Relief Act provides tax help to homeowners who lose their homes in foreclosure or who sell with a short sale, BUT only if the property was their primary residence AND it is only applicable to acquisition indebtedness.
The IRS is working on the forms that the homeowner will need to complete and these forms are likely to be fairly complex. Hence, it is my belief that seeking professional help or contacting the IRS customer service counselor is absolutely necessary.

(Attending the free consumser workshop at the UCR Extension Campus (see yesterday's blog) may also be helpful. It is primarily focused on preventing foreclosure, which would be a homeowner's best option.

Consumer Workshops

February 20, 2008

On this Saturday, February 23, 2008, Senator Bob Dutton will be hosting a consumer workshop from 10 a.m. to 12.p.m. at the UCR Extension Campus, 1200 University Avenue, Riverside, California. This is the last in a series of scheduled workshops focusing on preventing foreclosure. Admission and parking are free.

There will be credit counselors, loan servicers and lenders on site to offer assistance and options available to help homeowners keep their homes. Attendees who wish assistance are asked to bring their loan documents and other relevant financial information.

Federal, state and local governments are working diligently to assist homeowners who are affected by the downturn in the housing market. These workshops are a great opportunity to get free professional advice.
For more information you can log onto http://www.yourhome.ca.gov/ or http://www.sucasa.ca.gov/.

Set Your Sights for the Lunar Eclipse

February 19, 2008

Tomorrow evening there will be a total eclipse of the moon. February 20 is the month's full moon and the eclipse will take place in the early evening. According to NASA's web site, West Coast viewers will miss the early stages of the partial eclipse because it begins before the moon rises.

The partial eclipse begins at 5:43 p.m. with the total eclipse starting at 7:01 p.m., the mid-eclipse at 7:26 p.m., total eclipse ending at 7:51 p.m. and partial eclipse ending at 9:09 p.m.

The San Bernardino Valley Amateur Astronomers will be hosting the viewing in the parking lot of the San Bernardino County Museum, 2024 Orange Tree Lane in Redlands. The group will have powerful telescopes set up for viewing the eclipse anad will also focus on the planet Saturn. Hopefully the cloud cover we are experiencing this morning will have dissipated and the view will be awe inspiring.
Bring your binoculars if you have any. Otherwise come and look through the telescopes and enjoy the amateur astronomers passion for the skies.

Volatility and Turbulence

February 18, 2008

On this Presidents' Day holiday it might be wise to remember the two presidents whose birthdays are being celebrated, George Washington and Abraham Lincoln. If you think that we are now living in a time of volatility and turbulence, think of the issues which were faced by these two great leaders.

George Washington participated in the American Revolution, the continental congress and thirteen years after the Declaration of Independence, in 1789, he became the first president of the newly formed United States of America.

Abraham Lincoln faced the issue of slavery, the secession of the confederate states, and a bloody civil war. How turbulent were the 1860s?

I have been reading Alan Greenspan's book, The Age of Turbulence, which is subtitled, Adventures in a New World. In it Greenspan recollects his background in economic issues and his more than eighteen years as chairman of the Federal Reserve. During his chairmanship the country experienced several recessions plus a constant threat of inflation. Just as the financial world is worrying about a possible recession or whether tweaking the monetary policy will hasten a round of inflation, Greenspan, in the 1980s and 1990s, faced many of these same dilemmas. Probably the subtitle of his book says even more about the times, as globalization and the information revolution effect our national economy.

However, Greenspan seemed always to be fundamentally an optomist. The stock market, the housing market and the banks and savings and loans went through serious downturns, but in the past, they did recover. When "irrational exuberance" influences market decisions, a day of reckoning seems inevitably to come. Compared to a revolution and a civil war, we are certainly not in the worst of times.

Reminder - Must File Your Homeowner's Exemption Today

February 15, 2008
California allows homeowners to file for a $7000 reduction in their property taxes if the property is their principal residence. Applications must be filed by 5:00 p.m. February 15 following a change of ownership. If you miss the filing time, 80% of the full exemption is available if filed between February 16 and December 10. This application need only be filed once, as long as the property owner continues to own and occupy the property as a principal residence.
The property must have been owned and occupied as the prinicpal place of residence as of 12:01 a.m. on January 1. Forms are available on line or at your county asssessor's office.

Who Really Was St. Valentine?

February 14, 2008
Since today is Valentine's Day, I thought I would share a little background into the history of this cultural tradition. I was treated yesterday to a presentation about St. Valentine and the development of the holiday. She was a dear friend and shared her research with me. I am excerptng from the her notes.
There is quite a bit of evidence that St. Valentine was a real person. Archeologists have unearthed a Roman catacomb and an ancient church, both dedicated to him. There is even a wooden portrait of him, engraved with the message that Valentine was martyred during the reign of Claudius II, approximately 269 A.D.
Prior to his beheading and while he was in prison, legend says that Valentine sent a farewell note to Julia, the jailor's daughter, whose sight he had supposedly restored. The note was signed, "From your Valentine."
By the Middle Ages, Valentine was one of the most popular saints in England and France. February 14 became Valentine's Day around 498 A.D. Later, in France and England, legend has it that people noticed that February 14 was the beginning of the mating season for birds and decided that Valentine's Day should be a day for romance. (Really?)
The oldest valentine still in existence today is a poem written in 1415 A.D. by Charles, Duke of Orleans, to his wife when he was a prisoner in the Tower of London.
By the 17th century, Valentine's Day was widely celebrated in England, and in the 18th century, people were exchanging handwritten notes. As printing technology improved, printed cards were exchanged. In America around 1840, a woman named Esther Howland began to make mass produced valentine cards.
Today, approximately one billion valentines are sent each year. Here's hoping you received your share!

The Word of the Quarter

February 13, 2008
The last half of 2007 the "in" word seemed to be "sub-prime". The first quarter of 2008 the "in" word has see,ingly changed to "foreclosure". All of the media are focused on it. The Congress is focused on it. California's governer seems focused on it. President Bush is focused on it. The treasusry secretary Paulson is focused on it. Fed Chair Bernanke made spectatcular rate deductions in response to the "credit melt-down".
To those of us in the real estate profession, foreclosure rates have always increased in the downside of a real estate cycle. I suspect that the arrival of the information age has greatly expanded the data available for disemination to the public. We had a huge number of foreclosed proerties back in the 1990s when the government created the "Resolution Trust" to aid lenders in the sale of repossessed homes. We even had a separate department that exclusively handled these properties for Freddie Mac and Fannie Mae. As I recall, this glut of properties lasted at least five years.
It will be interesting to see how all the programs created to assist homeowners in foreclosure will ultimately work. In any program, the final question will be the ability of the homeowner to make the payments and the desire of the homeowner to make payments on a loan that may be greater than the present market value of the home. It is the psychological downer to know you have no equity and this is what leads to a homeowner's decision to stop making the mortgage payments, perhaps even more than the inability to make the payments. Helping the homeowners under the threat of foreclosure may or may not address this issue.

The Most Asked Question

February 12, 2008

It seems that the question on many folks minds requires a crystal ball to answer.

It is some form of: How long will the decline in housing prices last? Are we at the bottom yet? When will we hit bottom? These are questions that economists often are asked. Some will offer an answer. Others will suggest what signs to look for that will indicate a bottom. One writer even went so far as to say that the bottom will be reached in June 2008. Some say 2009, others more pessamistically say 2111.

For those of us who have experienced other real estate declines, our experience has been that realizing a change has occurred (namely the market has "bottomed") comes more in retrospect that on any certain day, week, month.

I am keeping a watch on the number of units listed and sold each month just to see if I can spot any significant changes. Forecasting the future is not my goal. Being aware of market trends is.

In the meantime, I shall continue to read all the literature on the state of the real estate market and glean what I can from the experts. For those of you who are anticipating a buy, make your lists of needs and wants and continue to educate yourselves as well. If you know what type of property you need and want, and you find it at a price you can afford, that will be the right time to enter the real estate market.

For those of you who for personal reasons will need to sell your present property, make your lists of improvements that will enhance the marketability. Contact a professional and experience real estate agent for input and for a market analysis and remember the mantra, condition, price and marketing.

What's on Your Mind?

February 11, 2008
Every once in a while I need feedback from readers, friends and acquaintances regarding their concerns about real estate. After 32 years as a licensed real estate agent in the state of California, I try to be prepared to answers concerns and to research market information. If you are reading this blog, it is easy for you to input a question or a comment. Just click on the comment button at the bottom of the post and you will pull up a screen that permits you to type in your comments and/or questions.
Are you concerned about when the real estate market will bottom out?
Are you concerned about the importance of "staging" your home?
Are you concerned that your home has been on the market for months with no offers?
Do you want to buy investment property?
How do I compute capital gains?
Hopefully you have other questions. Just send them on and I will search out answers.

Is Today A Good Time to Buy Real Estate?

February 8, 2008
I was interested in reading a posting regarding commentators who took exception to the National Association of Realtors' "It's a great time to buy" ad campaign. These commentators called the campaign self-serving and damaging to potential home buyers. Self serving is probably true. What marketers do not push their own product? But damaging to potential home buyers - in what way? The argument seemed to be that for many folks, renting would be a better choice since the credit crunch is the result of folks without sufficient resources becoming buyers when they shoud have remained renters.
I suppose the argument can go on as to whether anyone should buy their own home or be a renter, but for those who want to buy, the market is definitely favorable to a buyer. Here are some reasons why I believe this to be true.
1) There is a large selection of properties for sale with mostly highly motivated sellers.
2) Unless a property is priced drastically under the perceived market value, buyers do not have to compete with other buyers in bidding wars.
3) Sellers will consider any and all offers and be willing to enter into negotiations.
4) Sellers are increasingly agreeing to make the requested repairs.
5) Interest rates are as low as they have been in some while.
All in all, if home ownership is in your list of goals, now is a good time to consider a purchase.

How Does Your Garden Grow?

February 7, 2008
With the weatherpersons predicting a sunny weekend, now is the time to check out your garden. Get rid of the moist leaves that the wind and rain have left in the garden beds. Turn the soil in the beds where you plan to put new plants - either annuals or perennials. Add equal parts of superphosphate and sulphate of potash for the bulb garden. This is a good time to plant ground covers so they will be established before our hot summer arrives.
And fertilize in earnest in February. Nitrogen encourages green growth, phosphorus increases blooms and potash is great for healthy root systems.
Check out your camelia plants. Remove infected blooms that brown and destroy the camelia flowers.
If the weather experts are correct, this weekend will be perfect for freshening up the garden.

Why We Live in the Inland Empire

1439 Patricia Drive

Oakmont Estates

February 6, 2008

Here are a few photos of our mountains as seen from some properties in Redlands. With snow on the mountains and clear blue skies, we often feel that this is one of the most special regions in the United States.

Solds in the Inland Empire/01/01/2008-01/31/2008

February 5, 2008

I thought it would be interesting to track the number of single family properties that transferred title (sold) in January of the past 4 years. If I can make these comparisons each month, I am hopeful that I will be aware of the time that the downward trend in the number of properties sold either flattens out or ceases. By now folks who listen to the media or read newspapers are well aware that the real estate housing market is experiencing an adjustment. In my tracking, I am not examining prices, but rather focusing on the number of units sold.

Banning/Beaumont............... - 2008/33 - 2007/54 - 2006/59 - 2005/68

Bloomington........................... - 2008/5...- 2007/6.. - 2006/12 - 2005/12

Colton...................................... - 2008/10 - 2007/26 - 2006/32 - 2005/33

Fontana................................... - 2008/40- 2007/120- 2006/154-2005/186

Grand Terrace........................ - 2008/3..- 2007/7....- 2006/8....- 2005/6

Highland................................. - 2008/11. - 200735... - 2006/42 - 2005/53

Loma Linda............................. - 2008/1... - 2007/12. - 2006/8.. - 2005/18

Mentone.................................. - 2008/3... - 2007/7... - 2006/7.. - 2005/6

Moreno Valley......................... - 2008/79 - 2007/95 - 2006/198- 2005/214

Redlands.................................. - 2008/27 - 2007/40 - 2006/41 - 2005/63

Rialto....................................... - 2008/21 - 2007/43 - 2006/64 - 2005/98

Riverside................................. - 2008/99 - 2007/283- 2006/238- 2005/316

San Bernardino...................... - 2008/56 - 2007/120 - 2006/189- 2005/151

Yucaipa/Calimesa.................. - 2008/26 - 2007/36. - 2006/47. - 2005/32

These numbers are derived from the data reported through the IMRMLS system. They do not include new homes sales, for-sale-by owner or foreclosure properties that are not listed in the IMRMLS.

Janaury Real Estate Statistics/Inland Empire, CA

February 4, 2008

The first month of 2008 is now history. In my goal to follow the real estate market, I am using the IMRMLS to track what is occurring in our area. Had I been watching the numbers between 2005 and 2006, I might have known that the market had peaked. Now I am hopeful that the numbers will indicate when a turn around occurs. Certainly, for those of us actively in the residential real estate sales arena, January 2008 has shown some positive trends.

On January 2, 2008, I counted the number of active and pending listings in 14 communities in the Inland Empire as reported through the IMRMLS. Then , on

February 2, 2008, I counted this data again. I want to see if listings are increasing or decreasing and if pendings are increasing or decreasing. This data is about the number of properties and does not reflect pricing.

Banning/Beaumont - Jan.2008/850 Active - Feb.2008/904 Active

Jan.2008/64 Pending - Feb.2008/87 Pending

Bloomington........... - Jan.2008/195 Active - Feb.2008/209 Active

Jan.2008/8 Pending - Feb.2008/11 Pending

Colton...................... - Jan.2008/340 Active - Feb.2008/345 Active

Jan.2008/24 Pending - Feb.2008/32 Pending

Fontana...................- Jan.2008/1768 Active - Feb.2008/1772 Active

Jan. 2008/128 Pending -Feb.2008/166 Pending

Grand Terrace........ - Jan.2008/71 Active - Feb.2008/66 Active

Jan.2008/6 Pending - Feb.2008/6 Pending

Highland................. - Jan.2008/390 Active - Feb.2008/409 Active

Jan.2008/29 Pending - Feb.2008/37 Pending

Loma Linda............ - Jan.2008/106 Active - Feb.2008/116 Active

Jan.2008/4 Pending - Feb.2008/10 Pending

Mentone................. - Jan.2008/71 Active - Feb.2008/70 Active

Jan.2008/6 Pending - Feb.2008/7 Pending

Moreno Valley........ - Jan.2008/2087 Active - Feb.2008/2131 Active

Jan.2008/213 Pending - Feb.2008/289 Pending

Redlands................ - Jan.2008/405 Active - Feb.2008/422 Active

Jan.2008/39 Pending - Feb.2008/27 Pending

Rialto..................... - Jan.2008/813 Active - Feb.2008/838 Active

Jan.2008/77 Pending - Feb.2008/71 Pending

Riverside............... - Jan.2008/2679 Active - Feb.2008/2787 Active

Jan.2008/204 Pending - Feb.2008/233 Pending

San Bernardino.... - Jan.2008/1887 Active - Feb.2008/1984 Active

Jan.2008/131 Pending - Feb.2008/141 Pending

Yucaipa/Calimesa - Jan.2008/492 Active - Feb.2008/469 Active

Jan.2008/34 Pending - Feb.2008/39 Pending

Tomorrow I will post the closed sales numbers for the years 2005, 2006, 2007,and 2008.

Super Bowl Weekend

February 1, 2008

Once every year for 42 years, the world comes to a halt. Over time, it seems, the championship game between the National Football League and the American Football League has become the time for a universal party. Even folks who do not follow the football season gather up friends and relatives and call it "party time."

In the real estate world, we have the annual discussion: Should we have open houses on Super Bowl Sunday? If you read the real estate section of your newspaper, you may notice that the time for an open house may be adjusted so everyone can go somewhere to watch the game. At one time, before I, too, became mesmerized by the big game, I held open houses on Super Bowl Sunday.

Frankly, I still had visitors. I even had serious prospects who really were not football fans. However, times change and I've succombed to taking the day off and relaxing with friends and relatives.

My sense of this year's super bowl pitch is: Let's enjoy the day, pick a team, cheer them on and lay aside any negatives. I would like this positive attitude to spill over for the remainder of 2008. If 6% of the properties are in foreclosure, 94% are not. Hallelujah! If interest rates are at historic lows and home prices have come down, Hallelujah, more folks can qualify. So I'm cheering for home ownership and next year the super bowl party will be in my new home!