Why It’s a Great Time to Buy a Home

By John J. O’Dell

You hear from real estate agents that this is the housing buying opportunity of a lifetime.  I’m not sure if it’s explained fully why it’s a buying opportunity.  Since I’m a real estate broker and a general contractor, I can offer my reasons why I think it’s a buy of a life time now.

To begin with land prices in Nevada County have not dropped in proportion to housing prices. A good building site is still in the upper $100,000’s.  In building a new home, you have to buy land, have plans drawn up and apply for a building permit.  The permit fees and mitigation fees can be  between $15 to $30 a square foot, depending if you are in the county or city limits. Then of course there are utilities hookup fees to pay for, the actual construction costs, and finally landscaping. When you are all through, with land, utilities, construction and landscaping you are at least $300 a square foot or more for construction of a new home.

Now houses are selling in the $75 to $150 a square foot price ranges. Houses are selling for less than you can reproduce them. Buying an existing home means you get land,  utilities are in, permits are paid for, in most cases landscaping is complete and you have no construction costs.

Having been in business for a long time, I remember well the saying (I think I made this one up), when times are good, people think it’s going to be good forever. When times are bad, people think it’s going to be bad forever. Times get bad and they get good.  Anyhow, that’s why I think it’s a great time to buy a home, investors think it’s a great time to buy a home, what do you think?

John J. O’Dell
Real Estate Broker
General Contractor
Here to help you to buy or sell real estate

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Banks Short Sales Equals Very Long Sales

By John O’Dell

I wrote an article last year that the banks were trying to make short sales shorter.  That post was based on news at that time that banks were streamlining their short sale process. Well, I think that was propaganda that was just made to make people think the banks are acting responsibly. Nothing has changed since the banks press release.

You can wait six months and not hear anything from a bank on a short sale. They even put the property in foreclosure in the middle of a short sale! I can give you several recent examples that I had with short sales, none of them good.

A 5,000 square foot house in Nevada County was a short sale. Listed at over $800,000, than dropped to $599,000, than $499,000, than finally to $399,000. One of my clients made a full price offer, but was in a backup position.  The buyers in first position, that is they made the first offer. The bank listed the property at $399,000, but then started negotiating with the buyer. The bank said (verbally)  OK we’ll take $450,000, but once the buyers said OK, the bank changed their mind and said no we want $475,000 and got it!  So much for fair dealing. By the way, 60 percent of the  buyers in second position are the ones that get the home, since the buyer in first position gives up and buys somewhere else.

I have several offers in for my clients in second position and several months later, we have not heard anything. We have an offer in for another client on an REO (bank owned home) in San Jose and we are in the second week of finding out if our offer has been accepted. The response we get from the listing agent is that the bank’s asset manager is over whelmed. I can’t give you the offering price, but you know real estate in San Jose is not cheap, yet the bank is “over whelmed”.

So what has been your experience in dealing with your bank?

John J. O’Dell
Real Estate Broker
Here to help you with your buying or selling of real estate.

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Reader Comments

John – Right there with you. Short sale closed after a year on the market, 3 buyers, 3 buyers walked, finally 4th hung in 6 months to obtain approval only for the water main to break 3-days before closing. I closed it but can’t afford to do many of these a year. Now the REO agents who have nothing to do and are picking up short sales. Great, 70% of listings will not provide information via returned phone call. Selling real estate in the dark here in San Jose.

#1 

Written By Anonymous on February 7th, 2010 @ 9:50 AM

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“Demon Sheep” Let the Political Games Begin!

Let the games begin! Now we again start the political cam-pain season and this little video has taken the internet by storm. It’s on the top ten twitters on Twitter. The ad, released this week by California republican candidate Carly Fiorina, takes aim at her primary opponent Tom Campbell. Ms Fiorina’s ad shows a human dressed as a “wolf in sheep’s clothing” with red laser eyes creeping around a field of real sheep.

• Depicts competitor as red-eyed sheep
• May be inspired by B-Grade Kiwi horror

If you don’t want to listen to the full cam-pain ad, skip to 2:20 for the demon sheep

According to the Huffington Post, the ad may be inspired by Black Sheep, a 2007 B-grade horror film made in New Zealand.

So, what do you think?

John J. O’Dell
Real Estate Broker

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Coyotes in Paradise – Watch Your Pets In Nevada County!

by Lisa J. Lehr

Most of us living in Nevada County moved here because we like the rural environment. Rural environments include wildlife, and that, for the most part, is a plus; however, most of us also share our lives with beloved pets, and clashes between wildlife and pets often end in heartache for the pet owner.

Coyotes are a particularly ubiquitous wild critter here in Nevada County, and pets falling prey to coyotes is a far too common occurrence. The consolation—if there is any—is that, compared to a car accident, dog attack, or abduction by a person with evil intentions, death by coyote is quick and, as far as we know, relatively suffering-free. Coyotes kill to eat, and they do it efficiently.

Still, it is heartbreaking to lose a cherished pet, and it is our responsibility to take care of them.

Coyotes are difficult to eradicate. They are becoming alarmingly unafraid of humans, with daytime sightings becoming more frequent. Trapping and relocating coyotes is not as good an idea as it may sound, as any young coyotes orphaned by this process will seek easy prey—e.g., our pets.

They can be frightened, so if you see one, try shaking a noisemaker (like a can full of hardware) or throwing things at it. Fire a Super Soaker (high-powered toy water gun) filled with water or vinegar.

More often, though, we don’t see them lurking around our property, as they are naturally nocturnal. The key to keeping coyotes away from your home (and your pets, your children, and you) is to eliminate all that attracts coyotes—mainly food. Coyotes are generalists, meaning they’ll eat just about anything.

With that in mind:

·         Keep your cats and small dogs indoors at night; your medium and large dogs, too. Coyotes hunting in packs can take down a fairly big animal.

·         Rabbits, chickens, etc. that are kept outdoors need protection: strong fencing with a top, and/or a small enclosure inside it that they can hide in.

·         Don’t let your pets’ food become coyote bait. Cats are best fed indoors, and dogs should be fed only what they will eat all at once, with no leftovers.

·         Be careful with your birdfeeders. Place them close to your house, and clean up spills. Do not feed squirrels, deer, or other wildlife. Any naturalist will tell you that birds are the only wild critters we should feed.

·         Put garden compost in enclosed bins, and gather your ripe fruits and vegetables immediately. Read More…

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Banks Paying For Their Bad Loans

Countrywide ad before they had to be taken over by Bank of America

Banks are reaping what they sowed.  As you know, during the housing boom, all the banks wanted were more and more mortgage loans. They loosen the rules that  so low that credit scores did not seem to matter, as long as you were breathing and had a pen to sign mortgage documents. So now they have to buy back their bad loans!

According to the Wall Street Journal:

“The accountants at Fannie Mae and Freddie Mac are  auditing mortgage files to uncover loans with improper documentation about a borrower’s income, and then forcing banks and savings and loans to buy the loans back.

Freddie required lenders to buy back $2.7 billion of loans in the first nine months of 2009. Fannie Mae won’t disclose its figures, but the mortgage trade publication Inside Mortgage Finance said Fannie made $4.3 billion in loan-repurchase requests in the first nine months of 2009.”

Of course now, the banks are tightening up their underwriting for mortgage loans more carefully than they were just a year ago.  This results in a further slowing down of the lending process. Which is good and bad of course. But I think in the long run it will be better for all of us. What do you think?

Written by John J. O’Dell
Real Estate Broker
With a background in Civil Engineering
and General Contracting

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90 Day FHA Anti-Home Flipping Rules Eased For One Year

During the recent housing boom, many peope were buying homes, putting a little money into them and then putting the homes back on the market, hoping to make a lot of money quickly.  This is known as flipping in the real estate world.  I saw some horrible examples of flipping, with people not knowing what they were doing.  It was amazing, but everything seem to sell. Of course the market crashed and that was the end of flipping.

That is until the market crashed so badly and prices dropped so low, that smart investors with cash started buying homes, fixing them up and flipping them. However, the Department of Housing and Urban Development (HUD) had banned flipping, fearing that people would not be able to sell the homes once they fixed them up. That is they would not insure a home that was resold within 90 days of purchasing a foreclosed home. This of course, limited the ability to sell the home to a new purchaser.

Now, in order to move foreclosed properties quickly, HUD has decided to eliminate the Federal Housing Administration (FHA) 90-day anti-flipping rule. Most experienced investors, buy a home, fix them up and resell them within 90 days in this market. (Surprise?  Yes the market is changing)

For full details you can read HUD’s press release.

Written by John J. O’Dell
Real Estate Broker

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Real Estate Scams Continue to Roll

I’m still receiving letters at the rate of one to two letters a week from overseas scammers  wanting to give me a portion of millions of dollars or invest in real estate. Bad English in writing the letters, promises of giving you a cut of the millions they are supposedly wanting to feral out of the county are tips enough that all these people want is to take your money. Most of them wind up in my spam folder, but you know, I have to check my spam folder to see that a client’s e-mail hasn’t gone there by mistake, so I always open them up for a laugh.

Sad to say, they make millions every year from people in America.  Here’s a video from the today show that explains a common real estate scams.

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Hitler Respones to the IPad

This is a very funny parody on Apple’s new IPad as seen on YouTube.  If you are offended by four letter words, than please do not view this video. This video has had over 1,389,000 views.

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Michael Jackson’s Former Rental House Sells For $3.1 Million

A sprawling Las Vegas mansion, once rented by Michael Jackson, was sold for $3.1 million Thursday, the Nevada palace reportedly being the spot where the late King Of Pop met the physician, Dr. Conrad Murray, who has been investigated in the wake of his shocking death.

The house, which Jackson lived in from late 2006 to 2007, spans 15,461 square feet and has seven bedrooms, ten bathrooms, a tennis court, a basketball court and a 20-seat theater.

The mansion is the largest piece of real estate sold in Sin City in nearly a year’s span, no small feat considering that the sagging economy has depressed both the city and its’ real estate.

The sale of the 15,000-square-foot (1,400-square-meter) house was the city’s biggest in almost one year, according to an e-mailed statement today from Vegas Fine Estates, the broker on the deal. The buyer was a doctor-lawyer couple with property in California and Asia, the broker said without giving their names.

Jackson, who died June 25 from a drug overdose, paid $1 million to rent the seven-bedroom house for six months over 2006 and 2007 after returning from a self-imposed overseas exile, according to the statement. The luxury home includes tennis and basketball courts and a 20-seat theater.

Source:  Bloomberg.com

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California December Home Sales Increased

· Overall, existing, single-family home sales increased 4 percent in December to a seasonally adjusted rate of 558,320 units on an annualized basis.

· The statewide median price of an existing single-family home increased 0.8 percent in December to $306,820, compared with November 2009.  However, portions of Nevada County median prices dropped.   Grass Valley areas median price in December 2008 was $300,000 compared to $235,000 in December 2009.  A drop of -21.7 percent.  Nevada City area median price in December 2008 was $331,000 compared to December 2009 of $324,500, a drop of -2.0 percent.  In Truckee area median price increased 6.5 percent from $469,500 in December 2008 to $500,000 in December 2009.

· C.A.R.’s Unsold Inventory Index fell to 3.8 months in December, compared with 5.6 months in December 2008.

LOS ANGELES (Jan. 22) – Home sales increased 1.7 percent in December in California compared with the same period a year ago, while the median price of an existing home rose 8.4 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today.

“As expected, the large year-to-year sales gains have diminished substantially compared with earlier in the year,” said C.A.R. President Steve Goddard. “However, home sales in December were strong, and were comparable to sales of late 2008. Activity in December can be attributed in part to the extension and expansion of the home buyer tax credit, as well as near-historic highs in affordability due to current price levels and low interest rates.

“For the second consecutive month, California’s median home price rose year-to-year in December, and had the largest year-to-year increase in more than three years,” said Goddard. “The state’s median price also remained above $300,000 for the second straight month.”

Closed escrow sales of existing, single-family detached homes in California totaled 558,320 in December at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity increased 1.7 percent from the revised 549,190 sales pace recorded in December 2008. Sales in December 2009 increased 4 percent compared with the previous month.

The statewide sales figure represents what the total number of homes sold during 2009 would be if sales maintained the December pace throughout the year. It is adjusted to account for seasonal factors that typically influence home sales.

The median price of an existing, single-family detached home in California during December 2009 was $306,820, an 8.4 percent increase from the revised $283,060 median for December 2008, C.A.R. reported. The December 2009 median price rose 0.8 percent compared with November’s $304,520 median price.

“Home sales were unusually strong in December and were more consistent with peak season trends,” said C.A.R. Vice President and Chief Economist Leslie Appleton-Young. “Historically, the median price declines November through February and then rises in March. However, lean inventory, historically low interest rates, and incentives for home buyers have resulted in California’s housing market experiencing non-seasonal variations.

“Looking forward, we expect the state’s median home price to fluctuate around the $300,000 level throughout the first quarter,” said Appleton-Young. “While we expect to experience price gains in the near term, it remains to be seen how the market will fare once the Federal Reserve discontinues its purchase of mortgage-backed securities.”

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