Tuesday, March 31, 2009

A Word About Short Sales

March 31, 2009

It seems to be the case more often than not that when a property is listed as a "short sale" in a multiple listing service, it will have a list price that can be very competitive with other comparable properties. Somehow, to the inexperienced, the assumption is that this price has agreed to accept a pay off that is less than the amount owed by the seller. Unfortunately, this assumption is incorrect most of the time. Typically, the listing agent has done a market analysis and has suggested to the seller that the current market value is the price shown by the market analysis.

A seller planning to sell the property "short" will contact the lender and receive applications for a short sale which document the seller's reasons for needing a reduction in the pay off of the loan. The filing of the seller's application for a "short sale" is a first step and often is not connected to a possible selling price. Once the property is listed, and if the list price is attractive enough to buyers, offers will be made and negotiated with the seller. Once an offer is accepted by the seller, the lender is contacted and the offer is forwarded to the lender for approval. Until the lender approves, the sale cannot go forward. Waiting for the lender's approval can take weeks and months and requires a great deal of patience on the part of the prospective purchaser.

Why lenders are so slow at approving or disapproving a short sale offer is a mystery to both buyers and often real estate agents. Since the seller is usually no longer making payments on the loan, it would seem that getting the property sold would relieve the lender of a "toxic asset".

The bottom line as to why there are so many properties listed as "short sales" and so few actually "sold short sales" is this huge gap between offer and acceptance. If the offers are too low, a normal seller would counter. Lenders could also counter, but for some reason they seldom do. Hopefully this glitch in the selling of distressed properties will eventually be corrected and lender responses will be timely. In the meantime, the super attractive list prices of short sale properties may be an illusion.

Monday, March 30, 2009

"Buyers Bounce Back"

March 30, 2009

"Buyers Bounce Back" was the front page headline of the San Bernardino Sun newspaper on Saturday, March 28, 2009. For those of us in the real estate profession, the headline was a welcome change from the normal doom and gloom of the media for the past several years.

Whether the improvement in the volume of transactions is due to the normal recovery in a real estate cycle or whether it is the result of the federal government stimulus, may be a tough call. The bottom line, however, is that in the Southern California Inland Empire real estate market, buyers have returned from the sidelines of the late 2007-2008 market.

As I prepare to research and post the data for the month of March, I believe that home sales will continue to be significantly greater than they were a year ago. I anticipate that as 2009 progresses, the increased percentage of sales year over year will decrease, but the volume will remain high.

As the Sun article states "The market is sparked by bargain hunting in affordable neighborhoods, the report (from DataQuick) said. And normal supply-and-demand forces are starting to build up."

Added to the affordable prices of homes is the $10,000 tax credit for the purchase of new construction and the $8,000 tax credit for first time home buyers, there are certainly real incentives for purchasing a home now. Interestingly, our experience has been that it is a price driven market and that the main incentive for buyers is the recognition that homes are a bargain prices. True, if you already own a home you will have to sell for less than you might like, but you can also purchase your next house for less. With the government keeping interest rates low and shoring up lenders, this is a very opportune time to be in the real estate market.

Friday, March 27, 2009

A BIG Opportunity

March 27, 2009

Thanks to the efforts of a dedicated University of Redlands professor, who developed a "community read" and subsequently obtained a grant from the National Endowment for the Arts, there is "The Big Read - Redlands taking place between March 15- April 25, 2009.
The program is for anyone and everyone. The book that is being read and discussed is Ray Bradbury"s 'Fahrenheit 451" which was published in 1953, but which has themes and questions about society that are relevant today. The NEA has made paper back copies of the book available at no cost. You can obtain a book at Redland's A.K. Smiley Public Library or at the Armacost Library on the University of Redlands campus.

The San Bernardino County Museum is also participating by hosting a discussion of "Fahrenheit 451" on Sunday, March 29, 2009 at 2 p.m. One question being posed has to do with the mission of the Museum. If books were banned, what stories would the objects in the museum collection tell us?

The purpose of The Big Read is to revitalize the role of literature in American culture and to involve the whole community in the reading and discussion of books of literature. The community actually chose "Fahrenheit 451" out of the list of suggested titles furnished by the NEA.

For more information about the NEA program you can go to http://www.neabigread.org/

For information about the Sunday discussion at the San Bernardino County Museum, you can contact education curator, Jolene Redvale at 909-307-2669, X252 or email: jredvale@sbcm.sbcounty.gov

In the Inland Empire, we are so fortunate to have so many cultural opportunities resulting from the dedication of our residents!

Thursday, March 26, 2009

In Redlands It's Classic

March 26, 2009

Last evening as I was driving home from work, a passed some bicyclers. For me, there is something special about the dedication of bicycle riders, both professional and amateurs who ride through Redlands and come here for the annual Redlands Classic Bicycle Races. Since a week or so ago, one can see more and more vans with bikes mounted on the roof parked at homes throughout Redlands.

This year, the bike classic is 25 years old. the idea of a bike race in Redlands was hatched in 1984 and brought to fruition through the leadership of then mayor, Carole Beswick, then council member, Dick Larsen, and bike racing participant and fan, Peter Brandt and Craig Kundig, bicycle shop owner. The race attracts both professional biking teams and amateur riders as well as just plain folks who like to ride bikes and enter their children in the youth events.

It is an awesome sight to see the pack of riders race by in a "whoosh" of spinning wheels. It is worth experiencing.

Another outgrowth of the event has been the food and vendor booths that permit local organizations and businesses to show their stuff. The Redlands Kiwanis adopted the event for the site of their annual Pancake Breakfast and the U.S. Postal Service has a booth with a special cancellation stamp.

The Time Trials begin today at 9:30 a.m. on Highland Avenue at Redlands Boulevard. Friday is the Beaumont Circuit and Saturday and Sunday are the big events for spectators and the public races for kids and adults .

Also on Saturday, you can sign up for the Rotary Ride, a scenic ride through Redlands' streets and hills. For more information for this event you can go to www.redlandsrotary.org/ride

Obviously, the races cause some disruption of traffic around town. The newspapers have maps and you can go to http://www.redlandsclassic.com/ and find much useful information about events and routes.

Wednesday, March 25, 2009

A Loan Revival

March 25, 2009

Back in the 1980s, FHA offered a loan which permitted the purchaser of a fixer property to include the cost of repairs in the purchase loan. It was the 203K FHA loan. For almost 20 years this loan has disappeared from the lending scene. Sometime last fall, FHA announced the revival of the 203K program.

The Section 203K program is the Department of Housing and Urban Development's program for the rehabilitation ad repair of single family properties. Since many properties now on the market are in need of repairs, this loan is an excellent means to help revitalize distressed neighborhoods.

The target market for these loans includes bank-owned properties, foreclosures and short sales; i.e. homes that have fallen into disrepair; properties where renovations were begun, but never completed; out dated kitchens, bathrooms, etc.

Many types of improvements are eligible provided that they become a permanent part of the property and add value. Improvements such as roofs and gutters, heating and ac systems, flooring, wells or septic systems, painting, interior and exterior, safety and energy efficient upgrades, handicapped accessibility improvements, etc.

Obvious luxury items such has swimming pools, bar-b-ques, gazebos, etc. cannot be included nor can structural improvements nor room additions.

The loan is based on the "as is" appraised value plus the borrowers proposed repairs and the value after the work has been completed.

The improvements must comply with HUD's Minimum Property Standards and all local codes and ordinances. A complete description of the work and the quantity and cost of each item must be documented. Cost estimates must include labor and materials sufficient to complete the work by a contractor.

When the 203K loan is closed, the proceeds designated for the rehab work are placed in an interest bearing escrow account and dispersed after the work has been completed and an inspection of compliance obtained.

While the process may seem a bit complicated, it is similar to any construction financing which sets up completion benchmarks for the payment to the contractor. The 203K loan is worth investigating if you are thinking of purchase a fixer as your primary residence.

Tuesday, March 24, 2009

Don't You Believe It !

March 24, 2009

I heard an interview yesterday evening in which the interviewee was in favor of the Treasury Department's plan to purchase "toxic Assets from the banks and thereby allow the banks to make loans to home buyers. The underlying assumption seemed to be that the housing market's decline in sales was due to a lack of available loans.

In a conversation with a mortgage broker and with a banker, there has not been an inability to make loans to "qualified borrowers". For our Inland Empire market area, the FHA loan is a great fit. With a maximum loan amount of $355,350 with a 3.5% down payment, many buyers are now choosing FHA financing. It may even be possible to obtain an FHA loan with 3.5% down up to $500,000. Loans in excess of the Fannie Mae, Freddie Mac loan limit of $417,000, but no greater than $500,000 may require a higher credit score and a higher interest rate. These loans often only require a 10% down payment. Interest rates on these higher loans have been quoted in the high 5% - low 6% range.

As I listen to our congressmen and to financial pundits, I do have a question as to what loans they have in mind. It must be for the very high end loans. Certainly that section of the real estate market has been extremely slow and we have attributed the lack of transactions to the lack of "jumbo" loans.

But.... if you are a first time buyer, or a purchaser of a home under the $500,000 selling price,
call us. We would love to put you in touch with a loan officer who can qualify you for a loan.

Don't you believe that lack of loans is responsible for the lack of home buyers.

Monday, March 23, 2009

Sales Are Sprouting Up All Over

March 23, 2009

The announcement on the financial news this morning that real estate sales are up 5% nationwide and 30% in California should not have been a surprise to those who read this blog. Each month now, for over a year, I have been posting the number of closed transactions and of pending sales. Spring of 2008 was a low point in the volume of sales taking place. Gradually as the year wore on, and as prices declined, buyers began to reenter the real estate market.

I am anxious to check the numbers next week to verify that the real estate market is reviving.

It is interesting to note that the government is calling for private investors to purchase the "toxic assets" form the banks. In one sense, private investors are already buying up these assets in the form of single family homes. While many of the buyers are definitely purchasers who are finding homes affordable, there are also investors who see the opportunity in the purchase of these properties. Here are the numbers for properties that have been removed from banks' non performing assets. (I just sampled two of the communities that I have been tracking.)

The IMRMLS reported that Redlands closed 118 single family home transactions since the first of January 2009. Of these sales, 53 were bank owned properties and 15 were short pay sales.

In Moreno Valley, which according to my research has the most active real estate market of the 14 communities that I trace, there were a total of 983 closed home sales since January first 2009. Of these, 747 were bank owned and 53 were short pay.

If the banks could figure out a more efficient way to process shot pay sales, the proportion of short pay to bank owned could be improved and the "toxic assets" would be absorbed without the length foreclosure process. In the meantime, there are fantastic opportunities to purchase homes at bargain basement prices.

Friday, March 20, 2009

It's Springtime

March 20, 2009

Today is the Vernal Equinox - the official beginning of the Spring season. This is the day when the number of daylight hours equals the number of night hours. A common joke in Southern California is that we can have all four seasons in one day, but that we lack the seasonal changes that occur in other parts of the country. Not true. Just look at our landscapes!

Fresh from the recent rains, our mountains have a coating of green from the newly sprouted seeds. Our flowering trees are blossoming. The citrus groves are emitting the incredible smell of orange blossoms. Deciduous trees are leafing out. And horticultural groups are offering plant sales and workshops on gardening.

On Saturday, at 7 p.m., Edward J. Rhodes, a collaborating professor in the department of physics and astronomy at USC will be giving a lecture at the San Bernardino County Museum. The lecture is entitled "Keeping Our Future Lunar Astronauts Healthy by Observing the Sun from the Moon". Dr Rhodes is hosted by the San Bernardino Valley Amateur Astronomers Club. This meeting is free and is open to the public. The San Bernardino Valley Amateur Astronomers Club is another of the great opportunities for residents of the Inland Empire. They set up their telescopes at the San Bernardino County Museum from time to time and share their astronomical knowledge.

Knowing more about the movements of our sun is a way to learn more about our climate and our seasonal changes.

A last word - If you are not allergic, take time to inhale that fantastic smell of the orange trees in bloom.

Thursday, March 19, 2009

Are Are Looking - For What?

March 19, 2009

The reports from real estate agents are that there are many prospective buyers calling about properties, going to look at properties and attending open houses. Many of these prospective buyers have houses to sell; many are in the "if I see what I want" category; others are just checking the inventory are are certain they will be able to purchase what they want for less money at some time in the future. These prospective buyers are searching for a home in which to live, but sometimes the search becomes clouded by the prospects thinking as investors more than as homeowners.

While it has been true that real estate does function as a wealth producer over the long term, a home's primary function is to provide shelter for the owner. Interestingly, however, it is the professional investors who are out purchasing the properties being offered at auction or at the incredibly reduced prices of the present inventory in the Inland Empire. These investors know that real estate markets are cyclical and that over time, these homes will appreciate in value. In the meantime, they find renters and often may have positive cash flows.

So why are the prospective homeowners waiting to make a bid on a home? I suspect that there is a lack of urgency in these prospects. They have seen that prices continue to decline, that the government is offering more incentives and that interest rates are not rising. This strategy has been somewhat successful, but may be becoming less so. The inventory is declining, the competition for the "great" locations and "great" houses has eroded the prospective homeowner's bargaining power.

2009 may be the year of "Coulda, Shoulda, Woulda....But". Perhaps it is time to identify your "buts".

Wednesday, March 18, 2009

Modifying Your Loan

March 18, 2009

The advertising and the telemarketers are ramped up to solicit homeowners with "toxic loans" or at least with loans that have high balances or high interest rates. I was interested in an article on the front page of the March 11, 2009 Wall Street Journal that was entitled "Housing Plan Creates Opening for Scammers". The administrations foreclosure prevention plan was designed to assist borrowers in lowering their mortgage payments to levels that are approximately 31% of the borrower's monthly income. The bill provides an incentive for loan servicers who successfully modify loans.

As part of the article, an inset was entitled "Home Truths". This inset read "The Federal Reserve recently issued advice for people seeking to modify their mortgage:

# Work with only HUD=approved nonprofit counselors. (See http://www.hud.gov/ )

#Don't agree to pay a fee before you are provided with the promised advice. (I would add that paying a fee should be a "red flag" to further investigate the counselor"s credentials.)

#Beware of people offering "guaranteed" results.

#Don't sign blank forms of documents you haven't read. (Any blank document should be questioned before signing and probably should not be signed.)

My blog-post of March 3, 2009 also addressed the issue of loan modifications. For many truly hurting borrowers who want to retain their homes, the loan modification process can be a real winner. The success of the program will depend on how it is implemented and how many borrowers can actually qualify for the new terms. To date the government's previous HOPE plan has only assisted fewer than 50 borrowers. We shall "hope" that the new rules are the result of intelligent tweaking of the plan.

Tuesday, March 17, 2009

The Wearin' of the Green

March 17, 2009


Happy St. Patrick's Day ! For as long as I can remember, March 17 has been the day to wear green - even if you are not of Irish heritage. It has become a fun time to have green drinks, eat corned beef and cabbage and sing or listen to Irish songs. It actually is a holiday celebrated by the Irish for probably 1000 years. The first document parade was in the mid 1700s. Around 1848, a parade was held in New York City. With the shamrock as a symbol, the day become celebrated with the "wearin' of the green".


In this 21st century "green" has become the by-word of environmentalists. We now have green energy, green buildings, and green politicians. It is "cool" to be "green" in a different way than just partying for St. Patrick.


Celebrate by purchasing an energy saving light bulb. Plant a vegetable garden or add veggies to your flower beds. They actually are an environmentally friendly way to make your garden pest resistant. Plant some garlic near your roses. Add some marigolds near your tomatoes.


Garlic breath may make you unattractive to your friends, but it also makes your plants unattractive to many insects.


For the tip of the day: Soak three or four ounces of chopped garlic bulbs in mineral oil. Add water and and use as a plant spray.


Our "wearin' of the green" can continue all year as we explore new ways to be environmentally sensitive.

Monday, March 16, 2009

Looking Forward

March 16, 2009

When things go awry, there seems always to be a search for who or what is to blame. An article in the February 23, 2009 issue of Time Magazine had a featured article entitled "25 People to Blame". It is an interesting list of men and women who once held great power over governmental and financial institution. Not all the folks on the list are Americans - Iceland and China partook of the free wheeling days of high expectations and financial innovations.

After these many months of finger pointing and of the favorite quote of the new administration, "We inherited the crisis", lets suggest to our representatives and senators that they look more for solutions and less for blame.

Whether the stimulus packages will work remains to be seen. All that money certainly should make an impact on something. Hopefully it will be on creating a sound economy. Bernanke in an interview aired yesterday on CBS' Sixty Minutes, felt that there is light at the end of the tunnel and that by later in 2009, credit markets should be functioning as they should in a capitalistic economy. I must say that the interview was heartwarming to me as Bernanke came across as a bright and practical man.

The two areas to watch for signs of stability are the financial (banks) and the housing markets.

As a practitioner in the Inland Empire the housing arena, there are signs of "Spring" in the housing market. Sales are up. Interest rates are good and prices are very affordable. The sequence in normal housing markets begins with first time buyers, then homeowners who wish to sell and buy. Banks are making loans to qualified homebuyers. Solving the job loss trend and the negative equity issues will go a long way to continuing the market stabilization.

Since the American consumer is one of the folks on the "Blame" list, the American consumer needs to be part of the solution.

If you are interested in the "Blame" list you can go to http://www.time.com/

Friday, March 13, 2009

Check Out These Opportunities

March 13, 2009

Writing this blog has made me much more aware of all the educational and entertainment opportunities that are available to residents of the Inland Empire. The first one that will showcase some of the talent that we have in the San Bernardino and Riverside counties.

On Saturday at 1:30 p.m at the Sturges Center for the Performing Arts at 780 North E Street in San Bernardino, the 21st annual Ollie McDonald Senior Talent Showcase will feature the seniors' musical and comedic performances. There will be nearly 30 performers from the 2 county area. The seniors begin rehearsing in January each year. The event is a fund raiser for the San Bernardino Parks and Recreation Department. Admission is $5.00. For more information call (909)- 384-5415.

If you are a lover of equestrian events, there will be a special event at Citizens Business Bank Arena, 4000 E. Ontario Center Parkway in Ontario. The famed Lipzzaner Stallions will perform their incredible moves. The show will be in the tradition of the Spanish Riding School, but are actually part of a troupe that is based in Florida and that has been touring the U.S. since 1970. The Ontario show will have 14 horses and 10 riders. For anyone who loves horses, this is a great opportunity! Tickets are $22.50 to $35. For more information you contact http://www.cbbankarena.com/

For music lovers, a free music recital will take place at 2 p.m. Sunday in the University of Redlands Memorial Chapel. It is the annual President's Honor Recital that showcases the School of Music students.

Thursday, March 12, 2009

Cram-down and Claw-down

March 12, 2009

Gradually some new terms are entering the American vernacular. For some months now, the media and the government have been using the term "cram-down". In this morning's Press Enterprise a featured article on the front page was entitled "Mortgage 'cram-down' bill seen as Inland key". The article begins "Federal legislation under consideration that would allow judges to reduce mortgage principals could be a key to Inland Southern California's economic recovery, says one local economist.

The so-called "cram-down" measure gives the U.S.bankruptcy courts authority to modify existing primary home mortgages of people seeking to settle with their creditors in a Chapter 13 bankruptcy."

We have all understood what it means when someone insists on doing something that we don't wish to do, but that that someone "crams down our throats." So now the use of "cram-down" is broadly used to mean making a person or an institution do something that they would not do of their own free will. There is opposition to the legislation, but will it be "crammed-down" on the legislators?

The second term has seemed to be in a developing stage. I could not find a Wikipedia definition and in fact a Google search had no references to the use of "claw-down" in the financial crisis context. Having said that, I believe it is used as a term when regulators are suggesting that funds earned from fraudulent speculation are required through law to be returned. The term suggestions the claw of an old penny arcade device that was manipulated by the operator to snatch up a prize. It is quite obviously meant to elicit negative connotations.

It is fascinating to me how new terms enter our everyday vocabulary.

Wednesday, March 11, 2009

One City's Committment to Trees

March 11, 2009

One of the reasons that Redlands has a reputation as the "Jewel of the Inland Empire" is partially dude to the city's longstanding commitment to trees. Even viewing Redlands as one drives past on Interstate 10, it is possible to see the texture of great variety of trees that fill the city's landscape.

In 2008, the city had a goal to plant 1000 trees. That goal was exceeded by 46. In 2009, 60 tiny little flowering trees were planted in Prospect Park for future enjoyment. The city offers 26 varieties of trees to be planted in parkways. Some of the most popular trees requested for parkways are crape myrtles and Chinese pistaches. Residents can request trees if there is sufficient room in the area between the street and the sidewalk. Several years ago the city instituted an honorary tree program. Citizens can donate a tree to be planted in a certain location and the tree is marked with a tag recognizing the person being honored and the donor when it is planted

In addition to their Aesthetic benefits, trees contribute environmentally. They provide shade which can keep you home several degrees cooler. They help with the CO2 replenishment in the atmosphere. Their leaves provide valuable material to compost and enrich the ground. They also provide lumber and wood pulp for the manufacture of paper goods.

This Arbor Week 2009, let's plant a tree.

Tuesday, March 10, 2009

Its the Week to Think Trees

MArch 10, 2009

In the state of California, this week has officailly been designated "Arbor Week". Nationally, "Arbor Day is the last Friday of April. However, states have been allowed to change the time to celebrate trees to a date that reflects an appropriate planting time based on the regional climate.

This year Califronia has selected the week of March 7 to 14 as "Arbor Week."

The first Arbor Day took place on April 10, 1872 in Nebraska. Julius Sterling Morton, a Nebraska journalist and politician had a long history of involvement in agriculture. He served as President Grover Cleveland's Secretary of Agriculture. His proposal was to set aside a special day dedicated to tree planting and to increasing awareness of the importance of trees. According to historical records, more than 1 million trees were planted that first "Arbor Day".

The idea spread to other states and now all 50 states celebrate their own Arbor Days. Other countries have also embrace tree days. Japan has "Greening Week". Israel has "The New Year's Day of Trees". Korea has "The Tree-loving Week". Iceland has "the Students' Afforestation Day and India has "The National Festival of Tree Planting">

For the homeowner, this "Arbor Week" is an excellent time to check out the trees on your property for broken branches or evidence of disease. Think about planting a new tree and how it might add to the ambiance of your property. Ask your city if they have a tree planting program. I know Redlands does and I know you can purchase a tree and have in planted as a memorial to someone. I was intrigued when I visited Switzerland that they had a program where individuals or groups could donate a tree to be planted on the hillsides and mountainsides as they wanted to beautify the scenery. What a great idea !

Monday, March 09, 2009

Three "Ups" and One "Down"

March 9, 2009
1. The number of transactions in many communities has doubled or tripled over last year.
2. The affordability index is approximately 60% - meaning that a median income person can qualify for a median priced home in the Inland Empire.
3. The traffic at open houses, the number of showings of listed properties are both increasing.
The one "down" is still the reluctance of prospective buyers to actually purchase a home.
Contrary to some media reports, it is not the lack of the ability to obtain financing that has impede buying decisions. Rather it is the "fear factor".
A survey conducted by John Burns Real Estate Consulting which was done in December 2008 showed the following reasons why home buyers aren't buying.
Almost 40% of those surveyed cited concerns about the economy and jobs. Another almost 30% cited the inability to sell their present home. And 20% were worried about further price declines. The remainder did have down payment and credit concerns. This emphasizes that fear is playing a major role in the economic recovery.
I would love some feedback from the readers of this blog. Are the concerns of the survey your concerns and if so what would allay those concerns. For what signs are you looking?
Click on the comment button and express yourself.

Friday, March 06, 2009

Always a Variety of Things to Do on the Weekend in the Inland Empire

March 6, 2009

Each week there are more and more opportunities for residents of the Inland Empire to entertain or educate themselves. Here are just a few.

1. Knitting and Weaving - "A Day of Color and Fiber" presented by the Association of Southern California Handweavers from 9 a.m. to 6 p.m. Saturday, March 7 and 8 a.m. yo 2 p.m. Sunday, March 8. It will be held at the Riverside Convention Center, 3443 Orange St. in Riverside. The admission is $10. More information at http://www.colorconnects.org/

2. The Western States Jazz Festival , featuring more than 50 high school bands begins today, Friday, March 6 at 2 p.m.- 9 p.m and continues tomorrow, Saturday, March 7 from 8 a.m. to 7 p.m. It is being held at Upland High School, 565 E. 11th St., Upland. Admission is free. More information at http://www.uhrb.org/

3. The Heartland Players of Yucaipa will present the last performances of Snow White and the Seven Dwarfs on Saturday and Sunday at the Heartland Players Theatre, 33994 Avenue E in Yucaipa. General admission is $10; students $8 and a family of four, $30. More information at http://www.heartlandplayers.org/ or call (909)838-4356.

4. The Redlands Symphony will be performing Saturday, March 7 at 8 p.m and Sunday March 8 at 3 p.m. at the University of Redlands Chapel. For more information http://www.redlandssymphony.com/ or (909-748-8018.

5. A free workshop to help homeowners avoid foreclosure will be held Saturday, March 7 from 9 a.m to 3 p.m. at the Goldy Lewis Community Center, 11200 Baseline in Rancho Cucamonga. Attendees will need to bring their identification and their loan documents in order to speak one on one with the consultants from the government and a variety of financial institutions.

Thursday, March 05, 2009

Closing Sales for February - 2009-2004

March 5, 2009

Here are the closed transactions as reported though the MRMLS for February 2009 through February 2004. Quite obviously, the volume of sales has picked up substantially and is beginning to reassemble a strengthening of the real estate market in most of the 14 communities that I track.

Banning/Beaumont.........2009/96.......2008/44.......2007/48.......2006/64.......2005/71.......2004/68

Bloomington.....................2009/22,,,,,,,2008/4.........2007/8..........2006/19.......2005/18.......2004/16

Colton................................2009/48.......2008/21.......2007/20........2006/35......2005/34.......2004/25

Fontana.............................2009/264.....2008/80......2007/86........2006/168....2005/202.....2004/170

Grand Terrace.................2009/4..........2008/4........2007/6..........2006/9.........2005/7..........2004/11

Highland...........................2009/41........2008/25.......2007/22.......2006/37.......2005/56.......2004/45

Loma Linda......................2009/7..........2008/8..........2007/13.......2006/10.......2005/8.........2004/10

Mentone...........................2009/7..........2008/12......2007/4.........2006/4.........2005/7..........2004/4

Moreno Valley.................2009/322.....2008/146....2007/92.......2006/189.....2005/187.....2004/192

Redlands..........................2009/32........2008/19......2007/43.......2006/50......2005/65........2004/39

Rialto................................2009/99........2008/22......2007/46.......2006/63......2005/96........2004/90

Riverside.........................2009/364......2008/147.....2007/190....2006/281....2005/280......2004/305

San Bernardino..............2009/232......2008/78........2007/95......2006/162....2005/164......2004/198

Yucaipa/Calimesa..........2009/35........2008/38.......2007/32......2006/38.......2005/47........2004/61



With the affordability index in the Inland Empire being approximately 60% of the median income earners being able to qualify for the median house, the volume continues to increase. It is interesting to note that Grand Terrace, Highland, Loma Linda, Redlands and Yucaipa have been more consistent in their volume numbers than are some of the larger communities.

Wednesday, March 04, 2009

California Joins the Tax Credit Stimulus

March 4, 2009

California has launched it's own $10,000 tax credit for any buyer of a newly constructed home. Needless to say there are some conditions that must be met in order to qualify for this credit.

1. The purchase must be for a primary residence - no second homes or income property.

2. The only eligible property is new construction. The builder must certify that the home has never been lived in.

3. The tax credit equals 5% of the purchase price up to $10,000 ($200,000 purchase price maxes it out).This credit is paid out over three tax years in equal amounts (i.e. $3300 for 2009. etc.)

4. Purchasers must reside in the home at least two years.

5. There is no repayment requirement unless the purchaser sells or rents out the property before the two years are up.

6. The state has allocated $100,000,000 for this program. This works out to 10,000 purchasers that could qualify under this program. Once these funds are used up the program will stop.

7. Within seven days after close of escrow, an application for new home credit (Part I of Form 3528-A) must be completed by the seller certifying that the home has never been occupied and a copy provided to the buyer or escrow holder.

8. In the seven day period, the buyer must complete Parts II & III of Form 3528-A.

9. The escrow person on behalf of the buyer and the seller will FAX the completed Form 3528-A to the Franchise Tax Board at (916)845-9754 and provide a copy to the buyer. FAXING the form is the only way it can be filed.

For more details, go to http://www.ca.gov/ and under the agency list select the Franchise Tax Board.

Tuesday, March 03, 2009

Check Out the "Work-out" Plan

March 3, 2009

The new stimulus packages have created an incentive for servicers and lenders to work with borrowers to find a solution to the flood of foreclosures. We have had some of our clients inquiring about calls they have received from companies and individuals claiming to be "work-out" specialists. While there are some reputable firms that can assist borrowers, there are also some that see opportunity in the incentives offered by the stimulus plan.

Here are a few offers to that may not be in your best interest.

You are approached by an "investor" who offers to bring your mortgage payments current and who will make your mortgage payments. In exchange they will ask you to deed the property to them and they will lease it back to you. We have seen instances where this transaction has resulted in the former owner being evicted or the rent being continuously raised. If there was no official transfer of the mortgage to the "investor". you are still the borrower who is responsible for the mortgage payments. Some of these less than honest individuals even keep your rent payments and never make your mortgage payments.

Another scam will offer to refinance your mortgage or to negotiate a repayment plan with your lender. Again, the unscrupulous will charge you a fee and may even fake your new mortgage without paying off the existing loan.

We realize from the calls we receive, that working with banks and servicers can be frustrating. The unsophisticated borrower has a difficult time knowing the terms and the process. We are now trained to speak "lenderese", but we do advise you to seek help from a professional you know or your local banker with whom you can sit down and discuss your situation eyeball to eyeball.

Monday, March 02, 2009

Listing and Pending Numbers Are Cause for Elation

March 2, 2009

It is a real joy to post the numbers of properties on active listing and reported to be pending sales. The ratio of pendings to listings has been growing steadily the past several months. If I look back to March of 2008, it is clear that that the San Bernardino/Riverside real estate market is experiencing great activity. Last year, the ratios were in single digits, this year of the 14 communities I track, 6 were ratios of 40% or more. WOW!

Banning/Beaumont..........Listings/722..........Pendings/216..........Percentage/29.9%

Bloomington......................Listings/150..........Pendings/68............Percentage/25.3%

Colton.................................Listings/259..........Pendings/117..........Percentage/45.2%

Fontana..............................Listings/1377........Pendings/666..........Percentage/48.4%

Grand Terrace..................Listings/42............Pendings/13............Percentage/31%

Highland.............................Listings/287..........Pendings/123.........Percentage/42.9%

Loma Linda........................Listings/83............Pendings/20...........Percentage/24.1%

Mentone.............................Listings/55............Pendings/8..............Percentage/14.5%

Moreno Valley...................Listings/1443........Pendings/887..........Percentage/61.5%

Redlands............................Listings/364..........Pendings/80............Percentage/22%

Rialto..................................Listings/627..........Pendings/329..........Percentage/52.5%

Riverside...........................Listings/2116.........Pendings/899..........Percentage/42.5%

San Bernardino................Listings/1600.........Pendings/564..........Percentage/35.3%

Yucaipa/Calimesa............Listings/331...........Pendings/94............Percentage/28.4%



The total number of active listings in the 14 communities as of March1, 2009 is 9456. The total number of listings in March 2008 was 12,522.

The total number of pendings on March 1, 2009 is 4084. (43.2%) The total number of pendings in March 2008 was 1134. (9.1%)