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More military service members who are underwater on their homes may now be able to take part in the Home Affordable Foreclosure Alternatives program, allowing them to qualify for short sales and deeds-in-lieu of foreclosure. 

The Treasury Department on Thursday clarified its guidelines for HAFA, after many military families had complained that the program failed to consider a permanent change of station as a financial hardship. The omission was preventing many from taking part in the program. Many military members who were underwater on their homes say they were current on their mortgage until receiving orders to move. 

“An example of such hardship includes a service member citing a ‘Permanent Change of Station’ order as the basis for his or her financial hardship when requesting HAFA even if such service member’s income has not been decreased, so long as the service member does not have sufficient liquid assets to make his or her monthly mortgage payments,” the Treasury said in a directive sent to mortgage servicers Thursday.

Source: “Treasury Moves to Help More Military Qualify for HAFA,” HousingWire (Sept. 29, 2011)

Other information on the Placerville, El Dorado County, California regions at: www.dougandbudzeller.com

Short sale transactions are becoming less popular among first-time home buyers. Buying a home in a short sale transaction may offer a huge bargain—sale prices average 27 percent lower than non-distressed properties—but more first-time home buyers say the processing delays aren’t worth the trouble.

Among first-time buyers, their short sale purchase share dropped to 39.7 percent of all short sale transactions in August—posting a three-month drop and reaching its lowest share ever recorded for first-time home buyers, according to the latest Campbell/Inside Mortgage Finance HousingPulse Tracking Survey. In November 2009, first-time home buyers’ share of short sales had reached a peak of 54.1 percent of all short sale transactions. 

With bargain deals, why are short sales losing their appeal? Buyers are complaining that short sale transactions take too long to close, with approval times often taking several months after a buyer even submits an offers. Some buyers frustrated at the delays are placing offers on multiple properties, planning to close on whichever one is approved the fastest. The average time on market for short sales is 16.6 weeks, and the majority of that time is spent waiting for short sale approval, the HousingPulse Tracking Survey found.

Source: “First-Time Buyers Losing Interest in Short Sales,” RISMedia (Sept. 26, 2011)

Other Placerville, El Dorado County, California information at: www.dougandbudzeller.com

The Internet giant is increasing its stake in the solar home power business with a $75 million “initial investment” to buy and own solar-panel generators on roofs of thousands of homes, The Wall Street Journal reports. 

Google is investing in Clean Power Finance, a start-up company that matches solar-panel installers with investors willing to buy rooftop solar-panel systems. “With Google’s investment, solar-panel installers can find home owners who want solar panels on their roofs but don’t want to have to pay several thousand dollars to own the system,” The Wall Street Journal article notes. 

“We’re excited about the opportunity to really help accelerate residential solar,” says Rick Needham, Google’s director of green business operations. 

The latest investment will likely help fund up to 3,000 home rooftop solar systems. In June, Google made a $280 million investment in residential rooftop solar-panel installations with SolarCity Corp. Google’s total investment in renewable energy has been more than $850 million.

Rooftop solar demand is growing, and home owners are finding paybacks too. Earlier this year, a study by Lawrence Berkeley National Laboratory found that solar panels not only saved home owners money on electricity bills but also helped boost a home’s resale value, particularly for existing homes. Good news for the Placerville, El Dorado County, regions of Northern California!

Source: “Google Invests $75 Million in Home Solar Venture,” The Wall Street Journal (9/27/11)

Neighborhoods with a large number of foreclosures and price declines are noticing the biggest drops in lending the last year, according to a new report by the Federal Reserve. 

The Fed said the drop in lending in these areas is partially from a decline in loans to borrowers who don’t use the homes as their primary residences, which often means investors have moved in. The report also found an increase of lower-income borrowers in these communities. 

“Higher-income borrowers accounted for 29 percent of all loans in those distressed neighborhoods last year, compared with 52 percent of loans in those neighborhoods in 2005,” a Wall Street Journal article notes. “In less-distressed neighborhoods, higher-income borrowers accounted for half of all loans in 2005 and 43 percent of loans last year.”

Overall, weak demand and tight credit standards caused mortgage lending to drop in most areas last year. Including our Placerville, El Dorado County, California regions.

Lenders originated 7.9 million mortgages in 2010, down 12 percent from 2009, the Federal Reserve reported in its annual analysis of mortgage data of more than 7,900 mortgage lenders. 

Source: “Housing Slump Hits New Mortgage Loans,” The Wall Street Journal (Sept. 22, 2011)

A lawsuit is being revived in federal court from a group of California home owners who allege that eight major homebuilders are responsible for the loss in value of their homes and for their neighborhood becoming less desirable. 

The home owners had purchased homes from 2004 to 2006 in new developments built by the eight major builders in the Inland Empire region of California. The home owners claim that the developers represented the homes as “stable, family neighborhoods.” But in the lawsuit, they allege that the builders marketed the homes to and financed unqualified borrowers, which in turn led to a “buying frenzy” that artificially inflated prices. 

Following the housing bubble, foreclosures and short sales in the neighborhood skyrocketed, leading to a high number of abandoned homes and unkempt yards and crime, the home owners say in the lawsuit. 

A federal district judge in Riverside, Calif., had originally dismissed the lawsuit, but the 9th U.S. Circuit Court of Appeals in San Francisco on Wednesday disagreed, saying the home owners could continue to pursue their fraud claims against the builders. The court said that the home owners sufficiently alleged that the builders’ practices “inflated the ‘bubble in their particular neighborhoods” and that “decreased economic value and desirability” are injuries that home owners can recover damages for in court.

Among the builders named in the lawsuit: Beazer Homes USA Inc., DR Horton Inc., Lennar Corp., MDC Holdings Inc., Pulte Group Inc.’s Centex homes, Ryland Group Inc., Standard Pacific Corp., and Shea Homes Inc.

Source: “‘Buying Frenzy’ Lawsuit vs. U.S. Homebuilders Revived,” Reuters (9/21/11)

Historic Placerville’s gold country now offers a multitude of colors. Trees, shrubs and native brush come alive with fall’s vivid palette. Highway 50 from Shingle Springs through Placerville to Camino is an excellent tour base, offering numerous side loops and historic sites.

 “Apple Hill” orchards, farms, ranches and their restaurants welcome visitors with bakeries and fall harvest treats. Trips can vary from short jaunts to day-long tours from Placerville to the Camino areas north of Highway 50. Gold Bug Mine and the many shops on the Main Street of Placerville offer other attractions

Maps, video and other current information are available on the websites below or contact us for any questions or assistance. We’ve served the “Mother Lode Country” for over 45 years with all types of real estate services.

Video tour of Placerville, El Dorado County, Ca. area:  http://www.youtube.com/watch?v=mGPoK87artA

Maps of area: http://www.applehill.com/CP10_pdf/CP10_20.pdf 
          http://www.applehill.com/CP10_pdf/CP10_21.pdf

California home sales and median price are predicted to improve only slightly in 2012, as the continuation of the tepid economic recovery, uncertainty about the future, and funding challenges forare expected to keep the market moving sideways, with little foreseeable momentum in either direction, according to C.A.R.’s “2012 California Housing Market Forecast” released Tuesday.

The forecast, which was presented today by C.A.R. Chief Economist Leslie Appleton-Young during her luncheon at CALIFORNIA REALTOR® EXPO 2011, says that California home sales next year is for a slight 1 percent increase to 496,200 units, following essentially flat sales of 491,100 homes this year compared to the 491,500 homes sold in 2010.

The California median home price will increase 1.7 percent in 2012 to $296,000 in 2012, according to the forecast.  Following a double-digit increase in the median price in 2010, the median home price will decrease a projected 4 percent in 2011 to $291,000. This seems to be in line with the Placerville, El Dorado County, California regions.

“2012 will be another transition year for the California housing market, as the continued uncertainty about the U.S. financial system, job growth, and the stability of the overall economy remain in the forefront for all market participants,” said Appleton-Young.  “An improvement in job growth, consumer spending, and corresponding gains in housing are essential to a broader recovery in the economy, but would-be buyers will remain cautious as they weigh these myriad uncertainties against the clear opportunities presented by today’s very affordable housing market.”

Video and more information at: http://www.car.org/newsstand/newsreleases/2011newsreleases/2012forecast/

The Federal Reserve announced Wednesday it will invest $400 billion in long-term Treasury securities over the next nine months, which is expected to send interest rates on mortgages even lower. The Fed’s move is yet another attempt to try to stimulate economic growth, which has faced stagnation in employment, housing, and household spending over the past couple of years. 

“This program should put downward pressure on longer-term interest rates and help make broader financial conditions more accommodative,” the Fed said in a statement Wednesday.

Mortgage rates have already been reaching record lows in recent weeks, but the Fed’s latest efforts are expected to send rates dropping even further. Economists predict that interest rates could drop by a few tenths of a percentage point, which would be significant to anyone getting a loan to purchase a home. 

However, tough lending standards remain an obstacle that is keeping many home buyers on the sidelines. Banks have tightened their lending standards, which have made even some buyers with good credit struggle to qualify for the best rate. This remains the biggest obstacle for buyers in our Placerville, El Dorado County, California region. 

Source: “Fed Will Shift Debt Holdings to Lift Growth,” The New York Times (Sept. 21, 2011)

With home prices falling, buyers are looking for a neighborhood that has a greater likelihood of holding its value over the long term. But how do you know what neighborhood is doomed and which will appreciate over time? 

A recent article at Bankrate.com says judging a neighborhood’s worth over the long haul comes down to two main factors: . 

For example, Andrew Schiller, creator of NeighborhoodScout.com, says signs of long-term opportunities for jobs in an area would be low unemployment, high household income, large or prominent colleges and universities, and seats of federal or state government. He says the Bureau of Labor Statistics is a good resource, particularly its Local Area Unemployment Statistics map, which provides unemployment information by metro area and county, as well as its Current Employment Statistics, which tells you how many people are employed in different sectors of the economy in a certain area.

As for judging a neighborhood’s amenities that can generate long-term value, Schiller cites characteristics like a neighborhood that offers a variety of nearby retail stores, low crime rates, parks, distinctive architecture, and good public schools. We consider this true especially in our rural area of Placerville, California.

Source: “How a Neighborhood Holds Property Value,” Bankrate.com (September 2011)

It’s not easy to get a loan these days, say housing experts. Even home buyers with excellent credit are struggling to get approved for a loan, as home lending standards have tightened to some of their strictest level in decades. 

Tightening credit is affecting home sales and hurting the housing industry’s recovery, economists note, as more borrowers face increased scrutiny in qualifying for a loan at the best rates. To get the lowest interest rates, home buyers are having to come with higher credit scores and larger down payments than just a few years ago, as well as having to show steady employment, verify assets, and even explain new credit cards and small bank account deposits, USA Today reports. Banks hope the higher standards will lead to fewer future defaults. 

“It used to be anybody with a pulse could get a home loan. Now you have to be an Olympic athlete,” Guy Cecala of Inside Mortgage Finance, told USA Today. “The pendulum has swung too far.”

Source: “Tight Standards Make Mortgages Tough to Get,” USA Today (Sept. 14, 2011)

Other articles relating to the Sacramento and Placerville, California regions at: www.sierraproperties.com